Home > Deficit, United States > US debt crisis: US House passes debt bill

US debt crisis: US House passes debt bill

August 1, 2011


As the House of Representatives passed a last minute bill to raise the US borrowing limit while cutting spending by $2.4 trillion, Left-wingers felt betrayed by the White House, saying the price paid to win Republican support had been much too high.

The legislation is due to be approved by the Senate on Tuesday, just hours before the US was due default on its obligations for the first time in its history.

It was approved by 269 votes to 161 votes as both discontented liberals and Tea Party Republicans who wanted even more spending cuts voted against.

Representative Emanuel Cleaver, a Missouri Democrat, said: “This deal is a sugar-coated Satan sandwich. If you lift the bun, you will not like what you see.”

Another, Cedric Richmond from New Orleans, said he feared it would have a “devastating impact” on working and middle class families, whom he said would bear the brunt of the cuts.

The agreement reached by the White House and party leaders in the House and Senate during tense talks over the weekend will allow Mr Obama to borrow the same amount, $2.4 trillion, to allow the government to meet its debt obligations into 2013.

But it came with considerable strings attached to cut the ballooning $14.3 trillion national debt.

About $1 trillion will be cut immediately from government spending, with a further $1.4 trillion to be agreed by the end of the year.

Liberals who once lionized Mr Obama were enraged that the White House failed to twist Republicans’ arms in Congress and include revenue increases in the deal, through closing tax loopholes for oil companies and removing various tax deductions that benefit the wealthy. The savings are made up entirely of spending cuts, though conservatives have had to swallow unwanted savings on the military.

The left-leaning grassroots organisation MoveOn described the deal as “grotesquely immoral”.

“Our members are wondering, ‘What in God’s name is going on in D.C.?'” said Justin Ruben, executive director of the group, which claims five million members. “The country needs jobs, and Washington is debating what vital programme needs to be cut.”” Michael Tomasky, a leading liberal commentator, wrote: “This is the lowest moment of Obama’s presidency.”

While George W Bush wrecked the country “through rank incompetence”, Mr Obama “is simply handing the Republicans the keys to the house and saying ‘take what you want’,” he said in the Daily Beast.

In the New Republic, Jonathan Chait said: “There’s a limit to how much faith one can place in a man who has so badly misjudged his political opponents time and time again.”

Robert Borosage, co-director of the Campaign for American Future, a liberal think tank, accused Mr Obama of yielding to “the Tea Party terrorists – the extremist faction willing to hold the economy hostage to get their way”.

The cuts would not improve the slow recovery, which would in turn affect Mr Obama’s prospects of a second term, he claimed.

Figures revealed yesterday showed that US manufacturing grew at its slowest pace in two years in July as new orders contracted.

“I think he is in increasing danger. The whole argument against him that he has been there four years and there are no jobs, that he has failed, will be an increasingly strong argument,” said Mr Borosage.

Without a major push to create jobs, the alliance of young voters, African Americans , Latinos and single women that elected Mr Obama in 2008 may well not turn out to vote next time, he added.

“Right now, his base is all he has left from 2008. The independents and working-class Democrats have begun to flee,” said Ed Morrissey on the Hot Air blog. “This deal won’t bring those voters back, and his source of organization and funding may largely give up on him.”

The White House defended the deal, saying it was “not the case that Democrats “got nothing”.

“We think the president’s leadership has been essential to this process,” said Jay Carney, the White House press secretary.

Categories: Deficit, United States Tags: ,
  1. August 1, 2011 at 9:03 pm

    Good roundup of thought ..

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