Republicans won't budge on spending cuts: Eric Cantor

CHICAGO Tue May 17, 2011 2:11pm EDT

House Majority Leader Congressman Eric Cantor (R-VA) tours the floor of the New York Stock Exchange, prior to ringing the opening bell, May 10, 2011. REUTERS/Brendan McDermid

House Majority Leader Congressman Eric Cantor (R-VA) tours the floor of the New York Stock Exchange, prior to ringing the opening bell, May 10, 2011.

Credit: Reuters/Brendan McDermid

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CHICAGO (Reuters) - Republicans in Congress will insist on real budget cuts and reforms of entitlement programs like Medicare before voting to raise the debt ceiling, House of Representatives Majority Leader Eric Cantor said on Tuesday.

Cantor said he remained "cynical" about whether Democrats will agree to the necessary spending cuts, though he was "heartened" by concessions voiced by his Democratic counterpart, House Minority Leader Nancy Pelosi, about the need to revise entitlement programs.

Cantor said an "air of willingness" pervaded the seven-member deficit reduction commission led by Vice President Joe Biden, on which Cantor serves, to make what both sides agree are trillions of dollars in cuts over the next decade.

Until real progress is made on the long-term budget problem, House Republicans will not back raising the nation's debt ceiling, Cantor said.

"The votes are not going to be there unless the cuts are there and unless the reforms are there," Cantor said during a visit to the headquarters of the CME Group Inc, which operates the nation's largest futures exchanges.

"If there is an outline on the table that it seems parties are rallying around, a bipartisan agreement, then I believe markets will then take note of that and have some confidence that, frankly, this country is not going to become Greece," added Cantor, a Republican from Virginia.

Republicans and Democrats have been debating the depth and breadth of cuts needed to shrink annual deficits projected in the trillion-dollar range over the next few years. The House Republican majority wants to use its leverage over approving a higher U.S. debt ceiling to secure bigger cuts.

The United States reached the legal limits of its borrowing authority on Monday, though the Treasury Department has said it should be able to stave off a default until early August.

Cantor said changes were needed to government-funded health care programs and to the tax code, which he said disadvantaged U.S. businesses.

President Barack Obama has called for cutting $4 trillion of the budget deficit over 12 years, ensuring the issue will be a focus of his 2012 re-election campaign. Obama has also advocated raising taxes on the wealthy.

Medicare, the government health care program for the elderly, is set to go broke in 9 years, Cantor said, with taxes and revenues covering a little over half of its costs.

Cantor's colleague, House Budget Committee Chairman Paul Ryan, has proposed shifting fee-for-service Medicare into a program of vouchers for the elderly to buy subsidized health insurance from private insurers on their own.

"We're defying all political convention by touching every third rail in politics. It reflects the seriousness which we have got to take this situation," Cantor said.

(Editing by David Lawder)

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Comments (10)
ginchinchili wrote:
Obama should just let the Republicans cause the US to default on its debt, watch the US fall into another recession, and watch our debt double for nothing. Then, maybe then, those who vote Republican will start to realize that the games the Republican Party plays have serious consequences and that the Republicans don’t care about America and its people.

The, with the Republican Party out of the way we can seriously start working on getting the US and the Middle Class back on track. It’s really sad and unfortunate that the Republicans want the US to have to pay for its debt at a much higher interest rate, money going to waste, but that’s the Republican Party for you. Let’s just hope there are no major foreign policies issues that come about requiring the US military, because thanks to the Republicans our hands will be tied.

Obama should not give in on this one. With the Republican’s record of increasing the debt limit, what, 8 times? when Bush was President, and then to refuse Obama the first time he asks, it is clearly partisan politics, once again the Republicans holding the country hostage for their political gain. The Republican Party is a gross disgrace.

May 17, 2011 2:29pm EDT  --  Report as abuse
moonhill wrote:
“The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. It is a sign that the U.S. Government can’t pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government’s reckless fiscal policies. … Increasing America’s debt weakens us domestically and internationally. Leadership means that “the buck stops here.” Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better.”–Senator Barack Obama 3/20/06

May 17, 2011 2:47pm EDT  --  Report as abuse
Mangojulie wrote:
It’s really easy to TALK about “touching the third rail” and not actually touch it. Such shameless pandering is comical. Paul Ryan himself acknowledged that he KNEW the Medicare changes he proposed would never fly, but proposed it anyway so that the issue could be TALKED about.

We don’t need purile blustering about sacred cows. The sacred cow that could actually make a difference along with spending cuts is tax policy and Republicans have essentially said they have taken a “death vow” to never raise taxes. So much for third rails!

May 17, 2011 3:06pm EDT  --  Report as abuse
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