The Senate gave up its Fourth of July recess to focus on raising the U.S. debt ceiling, but there was no sign Wednesday that lawmakers were close to reaching an agreement on the basic divide: tax hikes vs. spending cuts. Kwame Holman reports on the latest developments in the negotiations.
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One day before congressional leaders are to meet with President Obama for new deficit reduction talks, members from both parties were holding their ground.
NewsHour congressional correspondent Kwame Holman has the latest.
The U.S. Senate gave up its Fourth of July recess this week to focus on raising the national debt ceiling. But there was no sign today that agreement is near on the basic divide over tax hikes vs. spending cuts.
SEN. DAVID VITTER, R-La.:
We must do something, and we must do something about the real problem, spending and debt. Washington, in a bipartisan way, has a spending problem. The fundamental problem isn't that we're under-taxed.
SEN. CHARLES SCHUMER, D-N.Y.:
Here's what it's coming down to.
In the homestretch of negotiations, our Republican colleagues seem willing — to be willing to tank the economy, rather than end a single tax subsidy. Democrats are committed to reducing the deficit and getting our nation back on a sensible fiscal track, but we know that everyone must pay their fair share.
At issue is how to cut the deficit by more than $2 trillion as part of any deal to increase the nation's borrowing authority. Lawmakers now are less than four weeks away from the Aug. 2 deadline to act, or risk a default on the federal debt.
With time running out, the president yesterday invited the leaders of Congress from both parties to come to the White House tomorrow to reengage in budget negotiations. Mr. Obama also came out against a narrow, short-term agreement, saying that would only kick the can down the road. Instead, he said, Congress should seize the opportunity to do something big.
Formal talks broke off two weeks ago, but there have been behind-the-scenes contacts, including a face-to-face meeting between the president and House Speaker John Boehner on Sunday.
At his Twitter town hall today, the president kept up the pressure on Republicans, charging again that they're defending tax breaks for the few, at the expense of the many.
PRESIDENT BARACK OBAMA:
The debt ceiling should not be something that is used as a gun against the heads of the American people to extract tax breaks for corporate jet owners or oil and gas companies that are making billions of dollars because the price of gasoline has gone up so high.
I mean, I'm happy to have those debates. I think the American people are on my side on this. What we need to do is to have a balanced approach, where everything is on the table.
In response, House Majority Leader Eric Cantor insisted Republicans are willing to eliminate wasteful or ineffective tax breaks. He said, "If the president wants to talk loopholes, we will be glad to talk loopholes."
And Senate Republican Leader Mitch McConnell called for large-bore changes in tax policy.
SEN. MITCH MCCONNELL, R-Ky. minority leader: I'm open to tax reform. We need to do it broadly. To sort of cherry-pick items in the context of this current negotiation with the White House strikes me as pretty challenging. Everybody's going to have to contribute to it in one way or another. We have a debt as big as our economy. We look a lot like Greece already. And it's going to have to have broad impact on every aspect of our society in order to get this problem under control.
Still, Republican leaders insist any revision to the tax code must not result in a net tax increase.
In the meantime, the president today dismissed any notion that he might act unilaterally, raising the debt ceiling by executive order.