Geithner on Spending Cuts to Come in Round Two

Check out the Super Committee graphic explainer here.

Treasury Secretary Timothy Geithner's op-ed for the Washington Post:

....The agreement sets up a powerful mechanism for agreement on tax reforms to strengthen growth, and entitlement reforms to strengthen programs such as Medicare. A congressional committee with fast-track authority will have a Nov. 23 deadline to recommend a balanced package of long-term reforms to produce $1.5 trillion in additional deficit reduction.

The agreement creates a strong incentive to compromise: If the committee fails to reach agreement or Congress fails to act on the recommendations, government spending will automatically be cut by $1.2 trillion. These across-the-board cuts, evenly weighted between the defense budget and domestic programs, would take effect in 2013.

These broad, automatic cuts, timed to coincide with the end of the Bush tax cuts, will make it harder for Congress to choose inaction over compromise.

The agreement removes the threat of default and lowers the prospect of using the debt limit as an instrument of coercion. It should not be possible for a small minority to threaten catastrophe if the rest of the government decides not to embrace an extreme agenda of austerity and the dismantling of programs for the elderly and the less fortunate. Read the rest at WaPo

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Geithner: Short Term Plan Unacceptable

As seen on twitter:

Maybe Speaker Boehner should try this tack: "Do you love your country more than you hate President Obama?"

Watch this flashback on to a time when democrat and republican leaders got along for the good of the nation.

Today, Boehner is coming up with another plan, unilaterally, according to WaPo. If the republicans can force a short-term debt deal, that will mean further damage to our economy, therefore further damage to Obama, which is and has been the republican end goal from the get go. It's interesting that Boehner, one of the key negotiators, made room for Fox News Sunday, whose audience is the choir.
Watch Geithner. The problem for Boehner is he needs some democrats to support his plan because there are some House members who absolutely will NOT increase the debt ceiling. The bottom line: Geithner says the debt ceiling will be raised.

Geithner appeared on a series of political talk shows Sunday to insist that any deal must lift the legal limit on the nation’s borrowing long enough to remove the possibility of a default from the politically heated presidential campaign season.

“There’s nothing wrong with doing this in stages,” he said on CNN’s “State of the Union.” “But what it cannot do is leave the threat of default hanging over the economy.”

Further raising tensions at the start of a critical day of negotiations, House Speaker John A. Boehner (R-Ohio) indicated Sunday that Republicans could push forward with a plan this week, even without Democratic support.

That threat of unilateral action further muddles the ongoing talks among congressional leaders of both parties and the White House on a deal that could get support from all sides. More at WaPo

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Understanding the Debt Ceiling

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