Budget Talks Near Collapse as G.O.P. Leader Quits
By CARL HULSE
WASHINGTON — Congressional Republicans on Thursday abandoned budget talks aimed at clearing the way for a federal debt limit increase, leaving the outcome in doubt as they vowed not to give in to a Democratic push for new tax revenues as part of any compromise.The breakdown was set off by the surprise decision of Representative Eric Cantor of Virginia, the House majority leader and one of two Republicans participating in sessions led by Vice President Joseph R. Biden Jr., to quit the negotiations.
This week’s talks were considered to be crucial as the Aug. 2 deadline for an increase in federal borrowing authority nears.
Mr. Cantor had previously expressed optimism that the sessions could produce a deal. But he announced he would not be attending Thursday’s scheduled meeting because Democrats continued to press for part of the more than $2 trillion savings target to come from moves like phasing out tax breaks.
“As it stands, the Democrats continue to insist that any deal must include tax increases,” Mr. Cantor said in a statement. “There is not support in the House for a tax increase, and I don’t believe now is the time to raise taxes in light of our current economic situation. Regardless of the progress that has been made, the tax issue must be resolved before discussions can continue.”
Senator Jon Kyl of Arizona, the No. 2 Senate Republican and the party’s other representative in the talks, said later Thursday that he would also skip the next negotiating session as he and Senator Mitch McConnell of Kentucky, the Republican leader, turned up the pressure on President Obama to play a larger role in the push for a debt limit deal.
“President Obama needs to decide between his goal of higher taxes, or a bipartisan plan to address our deficit,” Mr. McConnell and Mr. Kyl said in a joint statement. “He can’t have both. But we need to hear from him.”
The Republican maneuvering threw the talks into disarray in a week when those taking part had hoped an accelerated schedule of meetings could produce a breakthrough that would persuade members of both parties to support a debt ceiling increase in the coming weeks.
As events unfolded Thursday, a White House spokesman, Jay Carney, said the negotiations led by the vice president were now “in abeyance,” and he tried to play down the development by suggesting that the White House had expected that at some point the president would take charge of the talks. Exactly when that would happen was not clear, and Mr. Carney did not elaborate.
Senator Harry Reid, the Nevada Democrat and Senate majority leader, also said he expected that the talks would resume at a higher level, though he provided no timetable.
“With what Kyl and Cantor’s done, I think it’s in the hands of the speaker and the president and, sadly, probably me,” he told reporters.
While it had been assumed that the Congressional leaders and Mr. Obama would ultimately have to strike the final deal, the Biden talks were expected to extend at least through the end of the month. The Republican withdrawal was an unexpected and sudden interruption.
Congressional Democrats expressed disappointment at Mr. Cantor’s decision and maintained that revenues must be part of any agreement.
“We cannot balance the budget solely on the backs of the middle class,” said Representative James E. Clyburn, Democrat of South Carolina, a member of the House leadership taking part in the talks. “We simply must forge a bipartisan agreement. Failure is not an option, and I hope a bipartisan resolution will be achieved.”
Democrats have repeatedly said that they could not support a budget deal that relies solely on spending cuts and other program changes to produce the more than $2 trillion in savings. Officials said Wednesday’s negotiating session was unusually tense as Democrats sought to get Republicans to commit to some revenue increases in exchange for Democratic concessions on spending cuts.
Republicans knowledgeable about the events said Mr. Cantor decided to withdraw from the discussions because of the continuing emphasis by Democrats on potential new revenues. They said that he, Speaker John A. Boehner, Mr. McConnell and Mr. Kyl had previously discussed their discontent with the Democratic push for revenues and that some action was necessary to change the dynamic of the talks and show that Republicans were serious about not accepting what amounted to a tax increase.
“I know the frustration that he feels when Democrat members continue to want to bring tax hikes into this conversation, and insist that we’ve got to raise taxes on the American people,” Mr. Boehner told reporters.
According to officials, Mr. Cantor, who disclosed his decision to The Wall Street Journal on Thursday morning, also informed his leadership colleagues about the same time. Mr. Boehner, who had a private visit with the president at the White House on Wednesday night, evidently was unaware of Mr. Cantor’s plans at that time.
Democrats suggested that Mr. Cantor’s decision also reflected an internal Republican Party political determination to avoid being tagged as an author of an agreement that broached the idea of added revenues.
Republicans indicated that talks could resume if Democrats agreed to take any tax increases off the bargaining table. And negotiating setbacks like the decision by Mr. Cantor and Mr. Kyl to walk away are not unusual in serious Congressional bargaining sessions, where talks often then get back on track. But time is running short, and the House and the Senate have only a few weeks left in the summer when both will be in session before running up against the debt limit in early August.
Though Mr. Cantor and others have suggested that the Biden group has already identified $2 trillion or more in savings, others say that the firm amounts are much lower and that significant work must be done to reach even that level.
At the same time, Senator Kent Conrad, the North Dakota Democrat who is chairman of the Budget Committee, said this week that he did not believe the $2 trillion deal that has so far eluded budget negotiators is sufficient, given the nation’s deficit and debt trajectory.
“This is not just about numbers on a page,” Mr. Conrad said Thursday. “This is about the future economic prospects of our nation.”
Eric Cantor, House G.O.P. Leader, Leaves Budget Talks - NYTimes.com
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