By Molly K. Hooper and Erik Wasson - 05/15/12 04:08 PM EDT
House Speaker John Boehner (R-Ohio) will threaten Tuesday that Congress will not raise the debt limit next year without spending cuts greater than the size of the debt ceiling increase.
According to excerpts of the remarks Boehner will deliver to the Peter G. Peterson Foundation fiscal summit on Tuesday afternoon, the Ohio lawmaker will "insist on my simple principle of cuts and reforms greater than the debt limit increase. This is the only avenue I see right now to force the elected leadership of this country to solve our structural fiscal imbalance."
Last summer's debate over raising the debt limit increase drove the partisan level of hyperbole to a fever pitch as President Obama and congressional leaders negotiated round the clock for a deal that extended the borrowing authority, while requiring more than one trillion in spending cuts.
The limit was eventually raised under a compromise deal that formed a supercommittee to find more cut in government spending, which it has failed to do. The debt will reach its ceiling again by the end of year, according to projections.
Of last summer's negotiations, Boehner will say that Obama caved to political pressure from the left-wing.
“We were on the verge of an agreement that would have reduced the deficit by trillions, by strengthening entitlement programs and reforming the tax code with permanently lower rates for all, laying the foundation for lasting growth. But when the president saw his former colleagues in the Senate getting ready to press for tax hikes, he lost his nerve. The political temptation was too great. He moved the goalposts, changed his stance, and demanded tax hikes. We ended up enacting a package with cuts and reforms larger than the hike. But it could have been so much more," Boehner will argue.
Treasury Secretary Tim Geithner, who addressed the summit Tuesday morning, warned Boehner against playing with the U.S. debt ceiling.
“We hope they do it without the drama and the pain and the damage they caused the country last July,” he said of Congress' role in the upcoming negotiations.
Senate Democratic messaging guru
Sen. Charles Schumer (D-N.Y.) was also critical of Boehner.
“It is pretty galling for Speaker Boehner to be laying down demands for
another debt ceiling agreement when he won’t even abide by the last one.
The last thing the country needs is a rerun of last summer’s debacle
that nearly brought down our economy," he said in reaction to the remarks.
Democrats argue that the House GOP has violated last August's debt ceiling deal by deploying a lower spending cap for 2013 in the House appropriations bills than the $1.047 trillion discretionary cap set in the August deal.
“Any sudden tax hike would hurt our economy, so this fall – before the election – the House of Representatives will vote to stop the largest tax increase in American history. This will give Congress time to work on broad-based tax reform that lowers rates for individuals and businesses while closing deductions, credits, and special carveouts. … Our bill to stop the New Year’s Day tax increase will also establish an expedited process by which Congress would enact real tax reform in 2013," Boehner will say, noting that the Ways and Means Committee is busy working out the details of the plan.
"The bottom line is: If we do this right, this will be the last time we ever have to confront the uncertainty of expiring tax rates. We’ll have replaced the broken status quo with a tax code that maintains progressivity, taxes income once, and creates a fairer, simpler code," Boehner will say.
— This story was updated at 12:52 p.m.