http://shawcapitalmanagementfinancialnews.com/2011/08/01/shaw-capital-management-financial-news-directory-house-calls-off-thursday-vote-on-boehners-debt-limit-plan/
Updated at 1o:54 p.m. ET
The U.S. House called off a Thursday night vote on Speaker John Boehner’s plan to raise the nation’s $14.3 trillion debt ceiling, after GOP leaders failed to round up enough votes to pass the measure.
A Tuesday deadline is looming. The government could default on its financial obligations and not have enough money to pay its bills if Congress does not raise the nation’s borrowing authority.
After two hours of debate, the House stalled late into the night to buy more time for last-minute arm twisting on the Boehner plan. He’s trying to raise the debt limit in a two-step process, while cutting spending each time by an amount greater than the debt increase.
Boehner met with resistant lawmakers throughout the day, even though his measure will likely die when it reaches the Democratic-controlled Senate. Some members of the House GOP majority are balking because they believe the Boehner plan does not cut enough spending.
“This bill is not perfect,” the speaker said. “I’ve never said it was perfect. Nobody in my caucus believes it’s perfect.”
Senate Majority Leader Harry Reid had vowed his chamber would take up the House bill immediately after the House acts — but only to defeat the measure. The White House has threatened to veto the GOP plan.
“No Democrat will vote for a short-term Band-Aid that would put our economy at risk,” Reid said.
The White House gigged the House GOP via Twitter. “Clock ticks towards August 2, House is naming post offices, while leaders twist arms for pointless vote. No wonder people hate Washington,” Communications Director Dan Pfeiffer tweeted.
Fears that the partisan deadlock in Washington won’t be broken by the Aug. 2 deadline caused the stock market to tumble this week. The impasse on raising the debt ceiling also has raised the possibility that America’s AAA credit rating — and that of five states such as Virginia and Maryland — will be downgraded.
The concerns within the GOP caucus, especially from freshmen elected with Tea Party support, underscore Boehner’s challenge. He needs 217 votes to pass his bill, and if about two dozen of his GOP members balk — as some vote counts suggest — he’ll need some help from Democrats to get his bill to the Senate.
Freshman Rep. Trey Gowdy, R-S.C., said he could not support the Boehner bill “in its current form.” His home-state colleague, Tim Scott, also is a “no” vote and he’s a part of Boehner’s leadership team.
“I’d like something systemic that transcends election cycles, like a balanced budget amendment,” Gowdy said.
Rep. Jason Chaffetz, R-Utah, who is in his second term, says he’ll vote “no” because the GOP plan doesn’t cut enough in federal spending. He told NPR he wasn’t swayed by Boehner’s plea Wednesday for Republicans to “get your ass in line” and follow his lead.
“I didn’t come here to go along to get along. These arguments of ‘get behind me’ aren’t persuasive,” Chaffetz said.
The speaker tweaked his proposal Wednesday after the non-partisan Congressional Budget Office said it would not cut the deficit as much as the speaker had said it would.
The plan calls for the debt limit to be raised by $900 billion, with accompanying spending cuts of about $917 billion over the next decade. Another vote to raise the debt ceiling by another $1.6 trillion would held next year, as long as Congress passes another $1.8 trillion in spending cuts to be proposed by a new commission.
Reid’s plan would raise the debt ceiling by $2.7 trillion through 2013. His plan calls for $2.2 trillion in cuts to federal spending, with more than half coming from an end to the wars in Iraq and Afghanistan.