GOP Caves on Debt Ceiling Fight, Giving Obama Big Victory

In a major victory for President Obama, House Republicans decided to agree to his demands to raise the debt ceiling without corresponding budget cuts, a signal that House members are realizing how little public support they have for their insistence on bringing the government to the brink of default to get what they want.

The Republican announcement came after several days of a retreat in Virginia, where they discussed the state of their party, strategized on a budget plan — and heard from pollsters who told them just how unpopular they are in the country right now.

So they came up with a face-saving measure to agree to a no-strings-attached increase in the country’s $16.4 trillion debt limit for three months, on condition that the Democratic-led Senate passed a budget plan by April 15. If they didn’t pass a budget, according to the Republican plan, then members of Congress would not be paid. It is not clear if such an ultimatum is legal because of strict laws regulating the process of changing congressional salaries.

“Next week, we will authorize a three month temporary debt limit increase to give the Senate and House time to pass a budget,” House Majority Leader Eric Cantor of Virginia said in a statement. “Furthermore, if the Senate or House fails to pass a budget in that time, members of Congress will not be paid by the American people for failing to do their job. No budget, no pay.”

Republicans had insisted for months that they would not accept an increase in the debt ceiling unless the president agreed to major spending cuts at the same time. But the president refused to negotiate on those terms. Obama said the debt ceiling increase is needed to pay for spending that Congress has already approved, and is not the time for major budget negotiations. That the GOP backed off from their demand is an embarrassment for them — which could be why they attempted to save face by seeking the April-15-or-no-paycheck deadline.

The White House was amenable to the Republican plan.

“We are encouraged that there are signs that congressional Republicans may back off their insistence on holding our economy hostage,” said White House spokesman Jay Carney.

The Republicans will now look for other opportunities to extract spending cuts from the White House, such as March 1 when the massive $1.2 trillion in sequestration cuts take effect on military and domestic spending unless the two sides come to agreement on how to stop them. Republicans believe they have leverage because Obama does not want to see such large-scale cuts on domestic spending.

The retreat on the debt ceiling followed a humiliating defeat for the Republicans on the fiscal cliff, where the president got  tax increases he wanted on the wealthy without committing to significant budget cuts that Republicans were seeking in return.


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