Budget talks break down; gird your loins for a government shut down

There are enough Republicans in the House who want a shut down – even without defunding Obamacare – that this breakdown in talks between the White House and Republicans probably means they will get their wish.


Budget talks between the White House and a small group of U.S. Republican senators have reached an impasse, eliminating Washington’s only active channel for resolving deep fiscal differences as key deadlines loom, senators and aides said on Friday.

usa_small Budget talks break down; gird your loins for a government shut down

A meeting on Thursday between the eight senators and White House chief of staff Denis McDonough failed to produce any movement toward a deal to reduce “unsustainable debt and deficits,” said Senator Dan Coats, a Republican from Indiana.

“Although these discussions have been serious and candid, this week’s meeting at the White House unfortunately proved that both sides remain far apart and the administration is unwilling to take the bold actions necessary to truly address our fiscal challenges and prevent this current pattern of governing from crisis to crisis,” Coats said in a statement.

He added that the solution must include restructuring expensive federal benefits programs, reforming the tax code and cutting other unnecessary spending.

Republican Senate aides said that the group of senators led by Johnny Isakson of Georgia does not see any reason to continue the meetings because there is not enough common ground. One aide said the major sticking point was a refusal by the Obama administration to consider a larger deal that included cuts to entitlement programs such as Medicare.

“Instead, the White House wanted to try for a small deal contingent on revenue, which is a non-starter for Republicans,” the aide said.

President Barack Obama and his Democrats have insisted that additional tax revenue, raised largely by closing tax deductions and credits for the wealthy, be part of any deficit-reduction deal.

Commenting on Thursday evening about the talks, a White House official underscored that condition.

“On matters related to the budget, the president has always been clear that closing tax loopholes that benefit the wealthy had to be part of any big deal. That’s been clear for several years,” the official said.

That bastion of right wing conservatism – the Congressional Budget Office – says that without reform. Medicare spending will be “unsustainable.” And the whole rotten edifice of entitlements threatens to bloat the budget past the point where the economy can continue to grow.

Something has got to be done – but apparently, not on President Obama’s watch. He wants to kick the can down the road pretending that the Republicans are just being meanies to the poor and elderly. All we need, according to the White House, is to jack up taxes a bit on the rich and everything will be peachy.

I’m not sure shutting down the government will solve anything. What the GOP wants can’t be done in a matter of weeks, or even months. Reform the tax code, entitlements, and unnecessary spending in 30 days? Are they serious? Obviously not. These are all worthy goals but the GOP wants to alter the nature of government and that’s not going to happen in a month.

More modest goals like achieving a significant reduction in spending or targeting government spending not to exceed 23% of GDP – where it was in 2008 – might be doable. That should be on the table when the countdown begins in earnest the last week of September.