RPT-Top Republican sounds optimistic on US debt talks

Mon Jun 13, 2011 3:46pm EDT

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(Repeats to delete extraneous letter in first paragraph)

By Andy Sullivan

WASHINGTON, June 13 (Reuters) - U.S. Democrats and Republicans are starting to agree on significant spending cuts as they step up talks to stabilize the country's long-term finances, a top Republican lawmaker said on Monday.

"There's room for us to agree on trillions of dollars in savings," Eric Cantor, the No. 2 Republican in the House of Representatives, told reporters. "We are beginning to see the essence of convergence on savings begin to happen."

Cantor and other negotiators face growing pressure to reach an agreement that would narrow record budget deficits and raise the country's $14.3 trillion debt ceiling before an Aug. 2 deadline.

The Treasury Department has warned that the country could face a default if the debt ceiling is not raised by then -- a prospect that could push the country back into recession and rattle markets across the globe.

Cantor said he hoped the group including Vice President Joe Biden would strike a deal that would ensure Congress would not have to revisit the politically painful issue before the November 2012 elections.

With Republicans insisting any increase must be matched by an equal amount of spending cuts, that means the group would have to agree on roughly $2.4 trillion in spending cuts.

Ahead of three days of talks, Cantor went out of his way to praise Biden's stewardship of the group, which includes five other top lawmakers.

"I've been very impressed with the way he conducts these meetings. He does like to talk but I guess all of us do or we wouldn't be here. I do believe he has conducted these meetings in a way that has kept the ball rolling," said Cantor, who is not normally known for his effusive praise of Democrats.

The sputtering economy poses an additional challenge for the negotiators as they seek to trim budget deficits that in recent years have hovered at their highest levels relative to the economy since World War Two.

Washington is unlikely to sign off on aggressive new stimulus efforts as Republicans push for spending cuts rather than additional deficit spending. Cantor said those cuts could be spread out over 10 years, which would minimize their impact in the short term.

"We are trying to look toward a plan that will manage down the debt and deficit and at the same time help signal a return to economic growth," Cantor said.

The deficit-reduction group is scheduled to tackle annual spending and budgetary process reforms in three meetings this week.

(Editing by Cynthia Osterman)

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Comments (2)
buildcastles wrote:
1.5 Trillion budget, $500 Billion to pay down debt, 2 Trillion coming in per year, instead of spending $3.5 trillion now. Of that we don’t have 1.5 Trillion. Simple huh?


Jun 13, 2011 6:09pm EDT  --  Report as abuse
davidfarrar wrote:
Okay, let me get this straight: Cantor wants to cut…”save” $2.4 trillion from the nation’s deficit over the next ten years, if only the Democrats are allowed to instantly add $2.4 trillion to the 2012 budget — and he hopes this will get them passed the 2012 elections.

This doesn’t sound like a good deal to me. It sounds like the House Republicans are ready to instantly raise the debt ceiling by $2.4 trillion in return for an unsecured promise to return the national debt to its present level in ten years.

Hey! But who am I? Just a little Tea Party member who will never vote for anyone who signs their name to such an insult.

ex animo

Jun 14, 2011 11:19am EDT  --  Report as abuse
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