Republicans Walk Out on Budget Talks

June 23, 2011

Congressional Republicans walked out of budget talks on Thursday over how to extend U.S. borrowing and avoid a looming debt default. "The Republican walkout should not result in the president and vice president capitulating to Republican demands," Sen. Bernie Sanders said.

 

"Poll after poll shows that the American people do not agree with the Republican approach, which suggests that the wealthiest people in the country and the largest corporations should be exempt from participating in deficit reduction.

"The American people do not believe, as the Republicans do, that the budget should be solely balanced on the backs of the middle class, the elderly, the sick, the children and the poor.  The American people want shared sacrifice and President Obama must not yield one inch from that principle." 

Why Eric Cantor Bailed

The GOP leader ostensibly walked out of budget talks with Joe Biden because the Democrats wouldn’t budge on tax hikes. But the move was also part of a tug-of-war with House Speaker John Boehner, who reportedly received word of the pullout only moments before it was leaked to the press. Patricia Murphy on the tensions inside the GOP—and why the final negotiations will come down to Obama and Boehner.

June 23, 2011 11:19 PM EDT

In the end, Eric Cantor took a hike—away from the interminable budget talks with the Democrats, and perhaps from his own House speaker as well.

The majority leader, the GOP’s go-to guy in negotiations with Joe Biden over the looming debt-ceiling crisis, infuriated Democrats on Thursday by announcing he is bowing out of the discussions. That is, until the other party abandons the idea of any tax increase whatsoever to bring down the ballooning national debt.

By single-handedly bailing out, Cantor puts the onus of finding an elusive deal back on John Boehner, the man who assigned the majority leader to the thankless task in the first place. The fact that Cantor reportedly gave the House speaker just a moment's notice of his decision before the news leaked to the press only reinforced the widespread belief on Capitol Hill that the two men are more rivals than teammates, especially when it comes to the loyalties of the large and powerful freshman class.

No one could imagine Steny Hoyer doing such a thing to Nancy Pelosi, despite their political differences.

One indication of why Cantor may have abruptly pulled out of the talks came when White House Press Secretary Jay Carney confirmed that Boehner and President Obama met privately Wednesday night. Carney said the meeting was "following up on conversations they had on the golf course on Saturday” during their 18-hole summit.

With the two principals already at the table, aides say the inevitable endgame ofObama and Boehner hammering out the final deal appeared to already be under way—rendering moot anything that Cantor could have done in the six-way talks with Biden.

After news broke of the majority leader's surprise maneuver, Boehner and Cantor hardly presented a united front.

J. Scott Applewhite / AP Photo

Cantor issued a statement explaining his blockbuster move but kept an unusually low profile for the rest of the day. At one point in the afternoon, when the House visitors’ gallery was cleared by Capitol police to eject a protester, reporters joked that Cantor must have put the man up to it to distract journalists from his comings and goings.

Boehner, on the other hand, stayed out front during the day, hosting his regularly scheduled Thursday press conference, where he was bombarded with questions about Cantor’s decision.

When asked if he had encouraged Cantor to break off the negotiations, Boehner said only that he sympathized with Cantor, clearly distancing himself from his deputy’s move. “I understand why he did what he did,” Boehner said. “But I think those talks could continue if they're willing to take the tax hikes off the table.” By bailing on the talks, Cantor has effectively shifted the negotiations from the congressional working group to Obama and Boehner, leaving anxious House Democrats without a representative in the negotiations and openly concerned that the president will strike a deal they won’t like. “We’re worried,” said Rep. Peter Welch, a Vermont Democrat, who compared Cantor’s withdrawal from the talks to playing Russian roulette with a loaded gun. “First, do we play brinkmanship until the end and risk doing real damage to the economy? And two, what kind of deal is it going to be?”

“Cantor is basically saying to Boehner, ‘Now it’s your problem.’””

House Democrats are still angry with Obama for cutting a deal with Boehner last December to extend the Bush tax cuts for two years, over the loud objections of much of his party.

With that history casting a shadow on the current negotiations, Welch said Democrats are not prepared to support the president on any agreement he achieves. “If they come back with a deal that is draconian, both to individuals and the economy, that’s a problem,” Welch said. “I support negotiations and I oppose default, but it’s not a blank check.” 

Democratic House members say they are most concerned about cuts to Medicare benefits under a possible Boehner-Obama compromise. Divisions over Medicare have even made their way into the White House, where aides say the economic team wants cuts to the program to speed deficit reduction, but Obama’s political team is insisting that protecting Medicare for seniors is too powerful a campaign issue for the Democrats to surrender before the 2012 elections.

Beyond heightening worries among House Democrats, Cantor’s move saddles Boehner with the nearly impossible task of finding a deal that will significantly cut the deficit without raising taxes. Cantor has repeatedly made the point that House Republicans do not have the votes to increase taxes to any degree, especially with almost 90 GOP freshmen who have pledged to oppose any hike.

“Cantor is basically saying to Boehner, ‘Now it’s your problem,’” a Republican aide said.

Rep. Scott Garrett, the No. 2 Republican on the House Budget Committee, said the GOP would be willing to end some tax breaks and subsidies to increase government revenue, but agreed with Cantor that rank-and-file Republicans would probably never vote to pass an agreement that increases taxes on individuals or corporations.

“This is a teachable moment for the White House,” Garrett said. “In the eight years that I’ve been here no one has convinced me that you can raise taxes and not hurt the economy.”

So what drove Cantor out the door of the Biden talks?

A Democratic aide who has been briefed on the negotiations said Cantor removed himself from the working group when Democrats proposed that tax increases be part of the equation to cut at least $2 trillion from the deficit over the next several years.

“He was engaged, I think he wanted to be there,” the aide said. “But when revenues came up, he shook his head and leaned back and said, ‘That’s it.’”

From the beginning of the year, Cantor and other House leaders have insisted that tax increases on individuals or businesses not be part of the discussions to raise the debt ceiling, even as they repeated that “everything must be on the table,” in the Biden negotiations.

Rep. Chris Van Hollen, a member of the Biden group, said he learned of Cantor’s decision when he was at the White House on Thursday morning—only after the news had broken in the press and Cantor called the vice president to tell him of his decision. Van Hollen said he was “disappointed.”

“The speaker of the House said it was time for an adult moment,” Van Hollen said. “Adult moments mean it's time for making tough decisions.”

With the gulf between Democrats and Republicans as significant as when the Biden talks began, Boehner said he expected to hear from the president about launching one-on-one negotiations.

But the speaker would not entertain questions about what Republicans would be willing to agree to cut in order to meet the looming August 2 deadline, when the American government will reach its debt limit and be forced to default on its obligations.

“If ands and buts were candy and nuts,” Boehner said, “every day would be Christmas.”