GOP mulls short-term debt-ceiling hike

Republicans want a short-term increase to the debt ceiling if the talks led by Vice President Biden do not produce sufficient spending cuts, Senate Minority Whip Jon Kyl (R-Ariz.) said Tuesday.

Kyl, who is representing Senate Republicans in the high-level talks, said his caucus largely agrees with House Speaker John BoehnerJohn Andrew BoehnerFive GOP lawmakers mulling bid to lead conservative caucus Ex-lawmakers see tough job market with trade groups Veterans are left out of medical marijuana protections MORE’s (R-Ohio) demand that the increase in the $14.3 trillion debt ceiling be paired with even bigger spending reductions.

ADVERTISEMENT
“As a general proposition — we haven’t taken a vote or anything in our conference — but I think everybody sees that as a minimum goal, that there has to be at least as many dollars in cuts as there are in an increase in the debt ceiling,” Kyl said.

Negotiators in the Biden talks are looking for a way to increase the debt ceiling enough so that it does not need to be raised again until the end of 2012, after the next election. Kyl said that timeline would require a debt-ceiling increase of $2.4 trillion.

But Kyl said the GOP would look to a shorter-term increase in the debt ceiling if the talks fail to produce more than $2.5 trillion in cuts.

“If we can’t get about two and a half trillion in real savings, then I don’t think there’d be much of an appetite on our side to raise the debt ceiling by $2.4 trillion,” he told reporters Tuesday.

Kyl said the spending cuts could take effect over 10 years or more.

The Biden talks convene for the sixth time on Thursday. Kyl said the meeting would focus on two contentious issues: revenue increases and spending caps.

“We will talk about something the vice president wants to talk about, which is revenue, and we will talk about something that we want to talk about, which is how to constrain spending in the future,” he said.

The Arizona Republican said the GOP intends to raise the idea of a spending cap along the lines of the 20.6 percent of GDP hard cap proposed by Sens. Bob CorkerRobert (Bob) Phillips CorkerOvernight Health Care: Watchdog finds Tom Price improperly used funds on flights | Ex-Novartis CEO sent drug pricing proposal to Cohen | HHS staffers depart after controversial social media posts HHS staffers depart after controversial social media posts: report McConnell: We may 'be in the early stages' of a trade war MORE (R-Tenn.) and Claire McCaskillClaire Conner McCaskillRed-state Dem tells Schumer to 'kiss my you know what' on Supreme Court vote Analysis: Dark money groups have funded 44 percent of 2018 congressional ads Beto O'Rourke is dominating Ted Cruz in enthusiasm and fundraising — but he's still headed for defeat MORE (D-Mo.). The White House favors a debt failsafe trigger that would force spending cuts or tax increases if the size of the debt is not shrinking compared to the size of the economy.

On revenue, Kyl said he does not think the Biden talks will be able to produce an agreement on comprehensive tax reform. Speaking on May 25, Treasury Secretary Timothy Geithner said he believes overhauling the tax code should be taken up after the debt-ceiling crisis is averted.

“I don’t believe we have the capability to do that in these negotiations with Vice President Biden. It is probably something the Ways and Means Committee and the Finance Committee will be involved in. And I am hoping we can do that later this year,” Kyl said.

Kyl declined to comment on what healthcare entitlements were being discussed, but said the talks “could get some long-term savings to a program like Medicare, and that would send a very strong signal to the markets.”

In a Monday email to colleagues, House Majority Leader Eric CantorEric Ivan CantorDave Brat's seat moved to 'toss-up' 4 years after upset victory over Eric Cantor The animating forces behind the Democratic Party are true, radical leftists Divided Democrats are in danger MORE (R-Va.), another member of the Biden group, revealed that talks are moving into a discussion of cuts to healthcare entitlements.

Cantor told fellow House Republicans he is “cautiously optimistic” that the talks will yield spending cuts in excess of the amount by which the debt ceiling will be raised.

“As you know, Speaker BoehnerJohn Andrew BoehnerFive GOP lawmakers mulling bid to lead conservative caucus Ex-lawmakers see tough job market with trade groups Veterans are left out of medical marijuana protections MORE has indicated that any increase in the debt limit ought to be accompanied by at least a commensurate reduction in the deficit. While discussions are still ongoing (and will continue this week), I am cautiously optimistic we can find sufficient common ground with the administration to enact spending cuts that meet the goal outlined by the Speaker,” he said in the email, obtained by The Hill.

Cantor said that in addition to the five meetings of the seven members of the Biden group, staffers have met “countless” additional times.

“Together, we have been going through all the major spending areas of the federal budget, beginning with non-healthcare mandatory programs and continuing with discussion on the healthcare entitlement programs,” he said. “We are also discussing discretionary spending and long-term budget process reforms that will hopefully prevent a repeat of the explosion of federal spending we have witnessed over the past several years.”

Cantor did not mention Medicare by name, nor the GOP budget, which would turn Medicare into a system of federal subsidies for private insurance companies. And he didn’t address the issue of tax increases, though GOP leaders have made clear they will not put taxes on the table — something Democrats have demanded.

Senate Majority Leader Harry ReidHarry Mason ReidDem infighting erupts over Supreme Court pick The dishonesty of the deep state The SCOTUS nomination clearly demonstrates that elections have consequences MORE (D-Nev.) did not respond to a question Tuesday about whether a shorter-term debt-ceiling increase would be acceptable. A Democratic aide said they would not negotiate on the debt ceiling through the media.

In addition to Cantor, Kyl and Biden, Sens. Max BaucusMax Sieben BaucusJudge boots Green Party from Montana ballot in boost to Tester Clients’ Cohen ties become PR liability Green Party puts Dem seat at risk in Montana MORE (D-Mont.) and Daniel Inouye (D-Hawaii) are participating in the talks, as are Reps. Chris Van Hollen (D-Md.) and James Clyburn (D-S.C.).

The Treasury Department has demanded an increase to the debt ceiling by Aug. 2, and Boehner has called for talks to wrap before July 4.

Kyl said the Boehner timeline would be tough to meet, given the current pace.

“We’d have to hustle more than we are hustling,” he said. “We’d need to get it done sometime in July.”