Feb. 9, 2016 SIGN IN | REGISTER

U.S. Hits Debt Limit

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Minority Whip Jon Kyl, the Senate Republican negotiator in debt talks, dismissed worries about a default but urged spending caps.

The Senate is due to vote later this week on a bill eliminating $2 billion a year of those subsidies, but the measure isn’t expected to pass largely because of GOP opposition.

Though it would cut only a tiny sliver of the deficit, it has given Democrats a much-needed talking point on the deficit given that they have failed to bring a budget blueprint of their own to the floor amid internal disputes over the size of spending cuts and tax increases they should pursue.

Meanwhile, House Minority Leader Nancy Pelosi (D-Calif.) and the two House Democratic negotiators in the Biden budget talks — Assistant Leader James Clyburn (S.C.) and House Budget ranking member Chris Van Hollen (Md.) — met with financial leaders in New York.

In a CNBC interview, Pelosi said Medicare is “on the table” for the debt talks, but she said the discussion should start with rolling back payments to drug companies for the Medicare prescription drug benefit. She also joined Reid in suggesting that tax breaks for oil companies be eliminated.

After getting pummeled for weeks by Democrats over House Budget Chairman Paul Ryan’s (Wis.) proposal to overhaul Medicare, Republicans seized on Pelosi’s remark and demanded that she provide more details of a Democratic alternative. The National Republican Congressional Committee sent out a press release saying that Pelosi was “willing to cut Medicare.”

Ryan, meanwhile, headed to Obama’s hometown of Chicago to defend his budget and his Medicare plan, which appears dead from a legislative standpoint and has become the Democrats’ favorite weapon to attack Republicans from coast to coast.

Ryan argued his plan would give future seniors the ability to get to choose their health care providers, while Democrats’ proposals would require rationing what care seniors can get.

“The president’s plan begins with trillions of dollars in higher taxes, and it relies on a plan to control costs in Medicare that would give a board of 15 unelected bureaucrats in Washington the power to deeply ration care,” said Ryan, who is mulling a run for Senate after Sen. Herb Kohl (D-Wis.) announced last week he would not run for re-election.

Republican leaders continue to demand that any deal on the debt limit include significant spending cuts and no tax increases.

“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,” Boehner said.

Kyl reiterated that tax hikes are off the table but said he would be open to negotiating a revenue-neutral tax reform package that would eliminate tax breaks for things such as ethanol production.

But Kyl said it would take much longer than two months to complete that work.

With the House out this week, Biden’s bipartisan talks have been put on hold. Although the negotiators made progress last week on some modest spending cuts, they haven’t yet made much headway on dealing with the larger questions of cutting entitlements such as Medicare and Medicaid.

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