Amid ongoing debt-limit negotiations, the Obama administration Monday sought to tie the Cut, Cap, Balance Act to the budget proposal put forth earlier this year by Wisconsin Rep. Paul Ryan.
In doing so, White House officials characterized the debt-reduction proposal as extreme and further to the right even of Ryan’s plan, which was heavily criticized for its proposed cuts to Medicare.
In a conference call with reporters, White House Communications Director Dan Pfeiffer called the Cut, Cap, Balance Act which the House will vote on Tuesday, “Ryan’s plan on steroids.”
The administration announced Monday that President Obama would veto the bill if it reaches his desk for a signature. Both the House and Senate will vote on the bill this week. While it could easily pass the House, passage in the Senate will be an uphill battle.
Nevertheless, Pfeiffer condemned the conservative Cut, Cap, and Balance plan, saying it “would require much deeper spending cuts than in the Ryan plan.” He added that while the proposal “may be a good soundbite,” it would have “devastating impacts on the economy.”
Jason Furman, deputy director of the National Economic Council, agreed, saying Cut, Cap, and Balance would “enshrine the Ryan budget into law.” It is, said Furman, the “equivalent of holding the debt limit hostage to an extreme agenda.” (It’s official: Obama would veto Cut, Cap, Balance Act)
Furman also explained that the proposed spending caps in the bill would amount to trillions in cuts over the next decade. He added, however, that realistically, it is “inconceivable to do cuts of this magnitude.”
In an email to The Daily Caller, Brad Woodhouse, communications director for the Democratic National Committee, agreed with the characterization.
“It’s Ryan on steroids,” he said, “and would enshrine in the constitution pain that would be visited on seniors in perpetuity.”
But according to a senior GOP aide on the Hill, Ryan spent much of last Friday lobbying behind the scenes to replace the numbers in the House version of the bill with the figures in his own budget proposal.
“Ryan is insisting on his numbers in the House version of Cut, Cap and Balance, even though thy are weaker than the Senate version,” the aide told The Daily Caller. “His cap numbers are higher, allowing more spending and would more than likely violate the provisions of the balanced budget amendment.”
Other staffers confirmed the reports, Friday, though they declined to comment on the record. (He wrote the book on it: Sen. Mike Lee talks Cut, Cap and Balance)
The Senate version of Cut, Cap and Balance used numbers from a budget proposal introduced by Sen. Pat Toomey of Pennsylvania, which would save $142 billion this year. The Ryan version contains $11 billion in savings.
Ryan’s office has not yet responded to a request for comment.
While the Republican caucus faces a vote on the bill on Tuesday, lawmakers continue to negotiations on a debt-reduction package with President Obama before an August deadline.
Monday saw the stock markets tumble amid the uncertainty. And rating agencies are sounding the alarm.
The Fitch rating agency warned Monday that it may downgrade the government’s credit from AAA to B-plus by August 4 if a deal is not reached. On the same day, Moody’s suggested outright that the federal government do away with the debt limit altogether.
Standard & Poor’s has said that not only does the debt limit need to be raised, it needs to be accompanied with at least $4 trillion in spending cuts.
In an email to TheDC Monday, S&P spokesperson John Pieuch said the agency expects the debt limit issue to “be resolved.” The agency’s previous outlook, he added, “take[s] into account the issue of the government debt trajectory over the medium term and the absence of a credible fiscal consolidation plan in the foreseeable future.”