We Have a Pinky Promise from the Republicans
and they Titled it:
"Pledge to America: The New Republic Agenda"
(in small print of course):
Roll back non-discretionary spending to 2008 levels before TARP
and stimulus (will save $100 billion in first year alone)
Establish strict budget caps to limit federal spending going forward
Require congressional approval for any new
federal regulation that would add to the deficit
By David Lawder, Andy Sullivan
and Glen Somerville
(Reuters) - Republicans acknowledged on Thursday they will have to sign off on more deficit spending to avoid a debt default that would roil financial markets and bring the government to a grinding halt.
Treasury Secretary Timothy Geithner pressed lawmakers to raise the nation's $14.3 trillion debt limit to allow the United States to borrow more and avert a crisis in the coming months.
House Budget Committee Chairman Paul Ryan, a Republican, said he recognized the need to allow the government to go deeper in debt.
"Will the debt ceiling ... have to be raised? Yes," said Ryan, who leads Republican efforts to slash deficit spending.
But he called for deep spending cuts in 2012 and the Pentagon announced it would trim its budget by $78 billion as both government and opposition in Washington vied to outdo each other in promises of tighter spending.
Geithner said the federal government may hit the ceiling by March 31 on the amount of debt it is legally allowed to issue, and urged Congress to raise it before then to avoid pushing the United States into default.
"Even a short-term or limited default would have catastrophic economic consequences that would last for decades," Geithner said in a letter to Senate Majority Leader Harry Reid, a Democrat.
Republicans won control of the House of Representatives in November elections on a promise to cut government spending and reduce debt but are faced with having to compromise on the debt limit.
They say any vote to increase the ceiling must be paired with a commitment to lower federal costs over the long term.
"The American people will not stand for such an increase unless it is accompanied by meaningful action by the president and Congress to cut spending," House Speaker John Boehner said.
DEFAULT DANGERSA debt default would throw markets into turmoil and dramatically increase government borrowing costs for years to come, further increasing the U.S. debt burden and sapping resources from the economy.
Bond investors remain wary of the safety and soundness of sovereign debt after the bailouts of Greece and Ireland last year, but Treasury officials said they did not see any evidence of such concerns pushing up U.S. debt yields at this time.
A Treasury official urged lawmakers preparing for a new budget not to mix up the debt limit issue with calls for greater restraint in government spending.
The official, who spoke on condition of anonymity, expressed confidence that Congress will raise the debt limit if only because not doing so would be so damaging. The rest of the sad story
For those of uswith a memory beyond 2 years,
DEFAULT DANGERS sounds an awful lot like
Hank Paulson's GLOBAL FINANCIAL ARMAGEDDON
if TARP was not approved. Are we at Level Orange Yet?
Mr. Boehner, you are now cued up for
shedding another tear.