Boehner flirts with debt default if Dems don’t accept Medicare cuts
WASHINGTON – Speaker John Boehner (R-OH) said the House may refuse to vote on raising the debt limit, which could force the United States into default in the next few months — potentially inciting an economic calamity.
“If the president doesn’t get serious about the need to address our fiscal nightmare, yeah, there’s a chance it [the debt limit vote] could not happen,” Boehner told Politico in an interview published Monday evening. “But that’s not my goal.”
“I think it’s time to deal with entitlement programs…on the debt ceiling,” he added, specifying that Republicans may demand cuts to Medicare and Medicaid — and limits on discretionary spending — as part of a deal to raise the borrowing limit.
The remarks reflect that the Speaker is taking his threat to a new level — that if President Barack Obama and Democrats don’t capitulate to massive spending cuts, House Republicans will block a vote on the debt ceiling. Boehner earlier sought to use the vote as leverage to extract concessions from the White House, but he hadn’t yet suggested that the vote may not happen.
Making the negotiations even more strenuous for Democrats is that the Speaker took tax increases completely off the table — the White House says taxes must be part of the solution to cut the deficit.
Economists have warned of a catastrophe if the United States fails to meets its obligations — a collapse in the financial markets, massive layoffs due to a plunge in consumer demand and a possible depression.
Treasury Secretary Tim Geithner warned this month that the U.S. would likely reach its $14.3 trillion debt ceiling by May 16, and have “no headroom” to borrow by July 8 even under extraordinary measures if Congress fails to increase the limit.