Budget

The Democratic Congressional Campaign Committee announced Monday that it is launching a new round of automated phone calls attacking the GOP 2012 budget in 20 key districts.

Democrats have seized on the House-passed budget resolution, authored by Rep. Paul Ryan (R-Wis.) for the fact it turns Medicare for those currently under 55 into a type of voucher system.

The campaign says the GOP is “ending” Medicare and the calls tell recipients, regardless of age, that their benefits will be cut even if those called are over 55.

The calls are circulating several districts, including Lou Barletta's (R-Pa.).

“You’ve paid into Medicare for more than 25 years and deserve the Medicare benefits you’ve earned. Under the Barletta plan, Medicare ends and you’ll have to save about $182,000 more to pay for your health care.  Where will you get $182,000?” the calls say. “Everyone agrees we must cut spending and tighten our belt, but Barletta has made the wrong choice.  Ending Medicare to pay for subsidies for Big Oil making huge profits or tax breaks for the ultra rich!  That’s not right.”

House Speaker John Boehner (R-Ohio) stood his ground Monday as the government hit the federal debt limit, reiterating his earlier demands for what must accompany any vote to increase that limit.

He again said that House Republicans will not back an increase to the $14.3 trillion debt limit unless it comes with "serious budget reforms and significant spending cuts."

Those cuts must exceed the approved increase to the ceiling, and tax increases are off the table, he added.

"Americans understand we simply can’t keep spending money we don’t have," he said in a statement. "Half-measures and gimmicks won’t get the job done, and tax hikes will only hurt job creation and do more damage to our economy."

Republican lawmakers responded to the government hitting its debt limit with proposals for spending caps.

The Treasury Department announced Monday that it was tapping into a pair of government employee pension funds as it reached its borrowing capacity. Sen. Bob Corker (R-Tenn.) and Rep. Jack Kingston (R-Ga.) both responded to the news by touting their spending-cap proposals as the way to rein in the nation's debt.

Republicans are currently negotiating with the White House over a package to include the debt limit. But differences over the depth of spending cuts, entitlement reforms and potential tax increases remain stumbling blocks. A number of conservative spending reforms have been proposed, including balanced-budget amendments and spending caps.

Geithner said he would reduce the government's investment in two employee pension funds as part of "debt issuance suspension period." 

Rep. Paul Ryan (R-Wis.) will fire back Monday at critics of his 2012 budget and accuse them of fomenting class warfare.

“Sowing social unrest and class envy makes America weaker, not stronger. Playing one group against another only distracts us from the true sources of inequity in this country — corporate welfare that enriches the powerful, and empty promises that betray the powerless,” Ryan will say, according to excerpts released in advance of the speech.

Ryan will argue that by transforming Medicare into a type of voucher system, his budget keeps promises to seniors, whereas inaction would lead the program to bankruptcy in 2024. He is countering relentless criticism from Democrats who say the GOP budget would end Medicare.

“Our plan is to give seniors the power to deny business to inefficient providers. Their plan is to give government the power to deny care to seniors,” he will say on Medicare.

He will also say during his address at the Economic Club of Chicago that his plan includes eliminating “corporate welfare” tax deductions, a phase more commonly associated with Democrats. 

He will also argue for restricting aid to the poor in order to shore up the overall fiscal picture.

“We have to repair our safety net programs so that they are there for those who need them most. This starts by building on the successful, bipartisan welfare reforms of the mid-1990s,” he will say.

The Obama administration has come to the defense of its embattled nominee to be deputy director of the Office of Management and Budget.

Senate Republicans have placed a hold on the nomination of Heather Higginbottom, meaning the nomination cannot be approved by unanimous consent. This move forces Senate Majority Leader Harry Reid (D-Nev.) to gather the support of 60 senators to close off debate.

Liberal Republicans such as Sen. Susan Collins (R-Maine) have expressed doubts about Higginbottom's qualifications, making this task more difficult. Senate Budget Committee ranking member Jeff Sessions (R-Ala.) has used the nomination to voice criticism of Obama's 2012 budget.

The government hits its $14.3 trillion debt limit Monday as a potential agreement to raise it still proves elusive.

A new poll finds more than half of Americans think a failure to raise the ceiling would be "disastrous."

The arrest of International Monetary Fund head Dominique Strauss-Kahn has thrown the IMF and French presidential politics into turmoil, as well as raised questions about the agency's efforts to bail out Greece.

His arrest also raises prickly issues about his potential diplomatic immunity (subscription required).

A special election in New York to replace resigned Rep. Chris Lee (R) has become a referendum on proposed GOP changes to Medicare.

NASDAQ and IntercontinentalExchange have withdrawn their $11 billion bid to buy the New York Stock Exchange.

This week looks to be a slightly slower one on Capitol Hill, with the House taking a weeklong break. However, there are still a number of hot topics on tap as the Senate continues work, including further developments on the debt limit and in the housing sector.

The week will start with a noteworthy event in the debt-limit debate. According to the Treasury Department, the government will officially hit the $14.3 trillion debt limit on Monday, even though it has tools to continue paying U.S. obligations until Aug. 2.

Various pieces of new data about the housing market will be released throughout the week. While the economy appears to be slowly recovering, the housing market has been a persistent drag as it continues to decline.

Lawmakers on both sides of the aisle are laying out demands and issuing warnings about the $14.3 trillion debt.

House Speaker John Boehner said the president so far is "really not serious about tackling the big problems."