White House, GOP draw red lines in debt debate
WASHINGTON (AP) — Struggling for the upper hand in the next round of debt talks, Republicans and Democrats this weekend drew lines in the sand they said they’d never cross when it comes to the U.S. debt limit.
The tough talk on the Sunday morning talk shows doesn’t bode well for voters who are frustrated by the political gridlock.
“I believe we need to raise the debt ceiling, but if we don’t raise it without a plan to get out of debt, all of us should be fired,” said Sen. Lindsey Graham, R-S.C.
Last week’s deal to avert the combination of end-of-year tax increases and spending cuts known as the “fiscal cliff” held income tax rates steady for 99 percent of Americans but left some other major pieces of business unresolved.
By late February or early March, the Treasury Department will run out of options to cover the nation’s debts and could begin defaulting on government loans unless Congress raises the legal borrowing limit, or debt ceiling. Economists warn that a default could trigger a global recession.
Also looming are deep automatic spending cuts expected to take effect at the beginning of March that could further erase fragile gains in the U.S. economy. Then on March 27, the temporary measure that funds government activities expires, and congressional approval will be needed to keep the government running. That’s one more chance to fight over spending.