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Senate Republicans Gird For Fresh Debt Ceiling Fight

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SENATE REPUBLICANS DEBT LIMIT
Senate Republicans signaled Tuesday that they are prepared to endure another round of fights over raising the debt ceiling to ensure spending cuts are part of the deal. | AP

WASHINGTON -- Despite the risk of economic and political fallout, Senate Republicans Tuesday said they're standing with House Speaker John Boehner (R-Ohio) in picking another fight with Democrats over tying spending cuts to a debt ceiling increase this year.

During remarks at a fiscal summit in Washington, Boehner warned he will require that matching spending cuts be tied to raising the debt limit when it hits its cap late this year.

"When the time comes, I will again insist on my simple principle of cuts and reforms greater than the debt limit increase," Boehner said. "This is the only avenue I see right now to force the elected leadership of this country to solve our structural fiscal imbalance."

The last time Republicans made the demand in the spring of 2011, the U.S. nearly defaulted on its debt for the first time and the country's sterling Standard & Poor's credit rating got downgraded. Thousands of federal workers were kept on edge for months, waiting to learn if a default meant they wouldn't get paid. Congress ultimately avoided a default and settled on a deal in August 2011 that raised the debt ceiling and reduced the deficit by $2.1 trillion. The agreement included no new revenues, which Democrats sought, and only cuts, which Republicans wanted.

Congress has historically raised the debt ceiling with little fanfare and without tying it to trillions in spending cuts. But top GOP senators said Tuesday that they agree with Boehner that, because of the country's skyrocketing debt, deep cuts should be part of the discussion now. The nation's debt currently stands at $15.7 trillion.

"I think that's the precedent that we set last time and I think that would be the minimum expectation," said Sen. John Cornyn (R-Texas), chairman of the National Republican Senatorial Committee.

Cornyn said he expected other Senate Republicans to endorse Boehner's call because they agree that the U.S. is spending too much borrowed money.

"Nobody said this was easy," Cornyn said of the fights of 2011.

Sen. John Thune (R-S.D.), chairman of the Senate Republican Conference, said he supported Boehner's requirement.

"I'd like to see something along those lines, yeah," Thune said. "If we did that, that would get us to balance in a fairly short amount of time."

"I would be in favor of that idea," Sen. Dick Lugar (R-Ind.) added.

More moderate Republicans avoided saying whether they supported another fight on the issue of cost offsets, though they hoped the tenor of this year's debate would be less toxic than last year's.

"I think that was unsettling to the American people, the markets and made it very difficult for essential federal government programs to operate efficiently," said Sen. Susan Collins (R-Maine).

Sen. Olympia Snowe (R-Maine), who announced that she is retiring this year in part because of her frustration with the partisan gridlock in Congress, said last year's debt fight is still having negative repercussions.

"Policy-induced uncertainty is at historic levels because of the fiasco surrounding that debate on the debt ceiling," Snowe said.

The real solution to the nation's debt is tax reform, Snowe said, though she cast doubt on Congress' ability to do anything on that front until at least after the elections.

"We're in a state of diversionary tactics here to avoid the big questions because of the election," Snowe said. "We haven't dealt with any of the mighty questions. That's why things haven't really demonstrably changed in the economic environment to create jobs ... because of what is happening here."

Senate Democrats pounced on Boehner for unnecessarily reigniting a fight that took the country to the brink of default.

"We all remember the very, very ugly process that this confrontational approach that we had during the last period of time we were trying to get a budget," Senate Majority Leader Harry Reid (D-Nev.) told reporters. Republicans can "grandstand all they want" on the issue, he said, but any debt ceiling deal tied to spending cuts will also have to include new revenues, such as tax hikes on the rich and guarantees that Medicare and Social Security are preserved.

"There is simply no way to do this, to support economic recovery, without using both sides of the ledger. So, of course that means some revenues," Reid said. "The American people agree with us."

Sen. Patty Murray (D-Wash.), also in Senate Democratic leadership, slammed Boehner for walking away from the "sequester" portion of last year's debt deal. Under that agreement, $1.2 trillion in across-the-board cuts would take effect in January 2013 if a special bipartisan committee failed to come up with cuts on its own. That committee ultimately did fail, and now Republicans want to rework the sequester to strip out defense cuts.

"Republicans have spent the last year running away from the deal we made to avoid the last artificial crisis they created, so I don't know why the speaker is already laying the groundwork for another one," Murray said. "Apparently one tea party credit downgrade isn’t enough for House Republicans."

The White House signaled that President Barack Obama will have no part in another protracted fight over on the issue.

"The whole country experienced the downside of the kind of brinksmanship the Republicans were willing to engage in and the economy suffered accordingly," White House Press Secretary Jay Carney said during Tuesday's briefing.

"The president is not going to do that again. It's not good for the economy, it's not good for the American people, and it's not necessary," Carney said. "The full faith and credit of the United States government should not be held hostage to the political ideology of one segment of one party."
 
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