Debt Talks – Dems want a BIG deal
July 6th, 2011
04:47 PM ET

Debt Talks – Dems want a BIG deal

From CNN Chief White House Correspondent Jessica Yellin:

Democratic officials familiar with the deficit negotiations are now saying that the White House is talking about doing a deal larger than the roughly $2 trillion deal we’ve heard discussed in recent weeks.  “The President doesn’t want a small deal that kicks the can down the field,” says an official.  One official said he thinks there are leaders in both houses of Congress who want to reach “a significant deficit reduction deal…something big and meaningful.”

Officials on both sides of the aisle say this could be in the range of a $3-4 trillion deal.

Sources tell CNN that the president thinks there are “leaders and members in both chambers” who want to reach “a significant deficit reduction deal,” “something big and meaningful” and “not the path of least resistance.”

Why up the ante, especially given the difficulty the two sides have had reaching agreement over a smaller roughly $2 trillion deal? Discussions with aides on capitol hill indicate some Republicans might like the idea of a larger deal – easier to sell to deficit hawks who want major cuts, and it could include more for everyone. Others say not so fast, insisting the larger deal would require major entitlement and tax code reforms that can’t be completed before the August 2nd deadline.

There’s politics and expectations at play here. With the bigger goal, Democrats and Congressional leaders can position themselves as pushing for something big and if it falls short, they tried. It’s not on them. This bigger option also sets up a straw man – a position to bargain down from so the $2 trillion looks like a compromise. Plus it gets negotiators that much farther away from the push for a short term deal.


Topics: Deficit reduction • The News

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soundoff (53 Responses)
  1. ThinkAgain

    The budget deficit SHOULD NOT be balanced on the backs of those among us who are the most vulnerable. Cutting funding to WIC literally takes food out of babies' mouths; I think the wealthy can better afford to pay a little more, since they'll still have more money than most folks make in a lifetime.

    The corporations and the wealthy enjoy the benefits of our nation's infrastructure – both physical and in terms of people – they should pay their fair share. PERIOD!

    Besides, it's the least they can do for the country that gave them the opportunity to make their wealth in the first place.

    July 6, 2011 at 4:59 pm |
    • Four and The Door

      Raise taxes and make sure unemployment stays high for the 2012 elections. I mean, looking at what he does rather than what he says, Obama really doesn't care how high unemployment goes. Maybe an unemployed citizen is a citizen looking for government benefits? Who knows the strategy?

      July 6, 2011 at 5:54 pm |
      • Ozz

        Where are the jobs promised in the mid-terms? You still blame President Obama when you own the House.

        July 6, 2011 at 6:19 pm |
      • skytag

        Cutting spending will cost more jobs than judiciously applied tax increases.

        "Obama really doesn't care how high unemployment goes."

        "So be it." — John Boehner's response when it was pointed out spending cuts would cost jobs.

        July 6, 2011 at 7:34 pm |
      • John

        Boehner was referring to GOVERNMENT JOBS. If a governmnet job is cut money is saved. 16.6 million full time equivalent employees of STATE and LOCAL GOVERNMENT. The current administration reports FEDERAL EMPLOYEES at 2.15 million – the largest federal workforce in modern history. Do we really need 18.75 million people working for the US Government? And, this number does not include the many independent contractos around the world that work directly for our government. It also does not include the many employees working non-directly for all the government agencies.

        July 7, 2011 at 6:59 am |
      • jean2009

        Yeah right government job cuts saves a lot...I suggest cutting Boehner's job for starters. Like cutting teachers and education funding is going to provide educated citizens. Basically all they want is a wealthy class an a peon class....that is why it is called trickle down economics.

        July 7, 2011 at 5:45 pm |
    • Sank

      Just what one would think an Obama supporter would say. How in the hell do you think the rich ought to pay for you because you don't want your taxes raised. This is a shame. Just proves what kind of Obama and crew really are just free loaders living off the taxpayer in America. Your sorry pitiful people.

      July 6, 2011 at 6:12 pm |
      • skytag

        "How in the hell do you think the rich ought to pay for you"

        He didn't say anything about anyone paying for him, so one has to wonder why you would attack him like this. Warren Buffett says the rich should pay more and I don't think it's because he's expecting them to support him.

        "because you don't want your taxes raised."

        Actually, you have no way of knowing his taxes wouldn't go up. This notion that only the poor favor tax increases for the rich is a myth. Warren Buffett advocates it. Obama, who is rich by most people's standards advocates. I know people who would see their taxes increase who advocate it.

        "This is a shame. Just proves what kind of Obama and crew really are just free loaders living off the taxpayer in America. Your sorry pitiful people. "

        The real shame is that you've allowed rabble rousers on the right to fill your head with all manner of nonsense and false stereotypes to keep you outraged. Turn off your radio and start educating yourself for a change.

        July 6, 2011 at 7:44 pm |
      • Ron

        We'll see how our republican brothers working for the government, receiving government support for medical/welfare, or earning less than $75K a year feel about all this when the rubber hits the road. We'll see how they really like that gov shutdown thing. Those silly politicians are sitting on a few million bucks in the bank to make it through a shutdown. What about you?

        July 6, 2011 at 7:53 pm |
      • jean2009

        I think others like Mark Zuckerberg have stated the same thing as Buffet, and most of Buffet and Zuckerberg income is in the form of capital gains which is taxed at a lower rate. Maybe capital-gains, corporate taxes, and dividend taxes should be eliminated and one type of income not distinguished from another.

        Tax wise we currently have a lot of rich people living la dolce vita on the government dole.

        July 7, 2011 at 5:13 pm |
    • Sank

      WHAT HAVE FREELAOADERS RIDING THE WELFARE LINE GIVEN THIS COUNTRY. ALL YOU CAN DO IS COMPLAIN AND WANT THE MILITARY DEFENSE CUT OUT. YOUR SO STUPID I DON'T EVEN WANT TO DISCUSS YOU OR ERKEL.

      July 7, 2011 at 10:54 pm |
  2. ThinkAgain

    Stand firm, Mr. President – DON'T BACK DOWN!

    July 6, 2011 at 4:59 pm |
    • you betcha

      Amen

      July 6, 2011 at 5:05 pm |
      • John

        So tell us – what is the presidents plan? What is he not backing down from?

        July 7, 2011 at 8:33 am |
    • Sank

      Yeah stand firm idiots and see where this gets you come election time. Now he and Hillary Clinton are trying to under the table take our firearms away from us. it will not fly. Better back off Mister rear.

      July 7, 2011 at 10:55 pm |
  3. Knucklehead

    Bernie Sanders for President!!!

    July 6, 2011 at 6:08 pm |
  4. Sank

    He bettwer back down or his presidency is out the window.

    July 6, 2011 at 6:14 pm |
    • Ron

      Sank, we have young men/women fighting and dying for this country every stinking day of the week. If he stands tall, at least he'll walk away with his life. If I need to break it down for you.....there are more important things than being president of the US. Maybe not more prestigious, but definitely more important! Maybe, you republican/tea partiers would do well to remember that.

      July 6, 2011 at 7:57 pm |
      • Sank

        Yeah well I'm a 30year veteran of the US Army Infantry. Fought three wars and I think Obama is trash along with you. He is going to destroy this country messing with the debt and not financing the military.

        July 7, 2011 at 10:58 pm |
    • Clwyd

      Why back down when you do two things when you are in debt. Raise revenue (taxes or at least loopholes) and make cuts, like in the military and Pentagon! Let the republicans refuse to budge and when the nation is ruined their party will be too!

      July 6, 2011 at 9:29 pm |
    • jean2009

      If trickle down economics, Bush era tax cuts, deregulation, subsidies for the rich, and no child left behind policies worked, we would currently have the best educated, highest paid work force with zero unemployment.

      Three times in the last 100 years, the Taft philosophy of supply-side voodoo economics has been the mantra of the Republican ultra-right, and in each instance it has proved to be the ruin of the middle class...under Hoover, Reagan, and Bush.

      July 7, 2011 at 5:20 pm |
      • Sank

        You don't even make sense. What your feeling right now is esactly what Obama did in his first year in office. Typical AA gotta blame someon else even though it was you on the camera in the held up liquer store.

        July 7, 2011 at 11:00 pm |
  5. Jeff Brown in Jersey

    Don't let these sneaks destroy the middle class Mr. President!

    July 6, 2011 at 6:27 pm |
    • John

      So you want the Bush tax cuts to be implemented again? That will kill the middle class.

      July 7, 2011 at 8:34 am |
      • jean2009

        I would beg you to read online: 100th Birthday of the Jerk Who Killed The Middle Class. at scam com for 2/5/2011

        July 7, 2011 at 5:26 pm |
      • Alicia

        Hi John, I think that you are parsing words here. What I'm cniimalg is not that complicated.Do you remember Reaganomics (called voodoo economics by GHWB)? Reaganomics was based on the supply side theories of Laffer et al. This posited that there was a sweet spot for tax rates and that, if you cut taxes, this could generate sufficiently increased economic growth to offset revenue losses owing to the cut in tax rates.So what Reagan did (for whatever reasons) was to simultaneously increase spending and cut taxes. Both of these actions flooded the economy with dollars, but both created a worsened imbalance between spending and revenues, which had to be plugged by borrowing more money and increasing the debt. This is pure Keynesian economics. End a recession by putting more money into the economy through what is supposed to be short term borrowing. The problem was that the Reagan tax cuts outlived the Carter recession (if you want to call it that), and Bush's tax cuts outlived the Clinton recession (if you want to call it that). – Larry Weisenthal/Huntington Beach CAReply

        March 2, 2012 at 9:02 am |
    • miro

      . Leaving aside the whole ideology thing, why would smneooe vote for a guy who has so little experience? Every manager at every Wal-Mart, Starbucks, and AutoZone in the country knows more about management. Every single mayor of every town in the country knows more about management. Hell, you probably could have thrown a rock into your average football crowd and hit smneooe with more executive experience than Obama. He literally had to learn on the job. I'd feel sorry for him if he was drafted into it, but he wasn't. When Clinton won his second term, Obama was a lawyer. Bush was elected to a second term the same day Obama won the Senate seat in IL. Who the fuck thought putting a total neophyte in the big chair was a good idea? I understand the black vote, and college students are morons on the whole. Yet there were sober, responsible adults who really thought Barack Obama was ready to lead the largest nation in the world, despite the fact that ten years ago he was just another one of the lawyers in a Chicago firm. Still blows my mind, 2 years later.

      March 2, 2012 at 8:18 am |
  6. Reason

    I am okay with cuts as long as there are cuts in the massive defense budget, which is insanely huge compared to social programs. And also with corporate earnings and the rich as high as they are, and the clear fact that NOTHING the rich earn will EVER trickle down (BASIC FACTS HERE PEOPLE) they need to start paying higher taxes, like the rates they payed under RONALD REAGAN. Raise the taxes, lower the defense, and cut everything else too. You cannot have your cake and eat it too.

    July 6, 2011 at 6:41 pm |
    • Sank

      By your comment you must not work for anyone. So then I feel I am correct in calling you a free loading drinker of wine and a smoker of MJ off welfare money. Am I not correct for you to want to bring down a hard working man who was successful enough to gain riches and furnish many people in this country with jobs. So your just proving why this country does not need your class ever as President or even drawing off the taxpayers. Cut the Human Resources Programs and then see the debt decrease.

      July 7, 2011 at 11:04 pm |
  7. Middle Class in Texas

    Don't back down Mr. President. All republicans want is to keep the wealth to the upper class. They say no to everything that benefits this country's economy because 1. It means the rich will have to finally pay their share, and 2. It means you will be a successful president, which they will not tolerate. Republicans priority one is to ensure president Obama fails in his efforts to strengthen America and be successful. God Bless America and God Bless Obama.

    July 6, 2011 at 6:54 pm |
  8. BobnLA

    A "big" deal huh? With all the compromises, nothing significant will happen. We will shift loopholes for more relief for big business and give the corporate greed mongers even more money and more power.
    It's all becoming Bull s–t!

    July 6, 2011 at 6:55 pm |
  9. Drlee

    Everyone wants to cry and whine about how their party is right and the other party is wrong. Shut up! The spotlight is on our deficit problems...now is the chance for everyone to put on their big boy pants and fix the problem.

    July 6, 2011 at 7:19 pm |
  10. lgny

    It's interesting how the Obama started by advocating a clean debt ceiling increase with nothing else attached.

    The Conservatives began insisting on accompanying cuts.

    Obama has wisely figured out that they are trying to apply "death by 1000 cuts" (pun intended). Need a budget passed, then agree to cuts. Need the debt ceiling raised, then agree to cuts, ....

    So this time, he's pushing for the big one that does all the cuts and revenue increases in one big deal.

    July 6, 2011 at 8:00 pm |
    • Winder

      Then where is the Senate budget? The Dems have not passed a budget since they have been in office. Let them put something on the table! They don't deserve their pay if they don't do their jobs.

      July 8, 2011 at 10:36 am |
  11. KaayJaay

    Simply put, forget the schools (and their kids/teachers), forget new energy sources (sustain the gas companies wealth), forget the jobs (unless we can control what we pay them and allow people who consider $8 a day great pay take them). Sounds like a great way to run this country in to the ground. Its crazy how as soon as this financial turmoil, years in the making finally hits, the first thing we do is back out of our rights as fathers and mothers to make our daughters and sons better than we were, goes out the window. The ones who will suffer the most are the youth from the bias and money hungry approaches of the majority of those refusing to make common sense decisions in Washington.

    July 6, 2011 at 8:22 pm |
  12. Clwyd

    It better include big cuts in the Pentagon and the military. Like slash them by 30%

    July 6, 2011 at 9:26 pm |
    • M Gonzales

      I love the military but yes we should just slash Medicare, Medicade and the Military by 30% and then attempt to find money or fixes to lessen the pain their.

      July 7, 2011 at 1:50 am |
  13. Ken in NC

    A "Big F–ing Deal" would be fine but when you got Eric Cantor saying he "is open to closing some of the tax "loopholes" that Democrats have been pushing, but only if those items are offset by reducing taxes in other areas", that stupid. There is no savings generated when you close one tax loophole that increases revenue by 2 billion dollars and then create a new tax break somewhere else that offsets the 2 billion. Eric Cantor is so stupid. If you put this fools brain in a bird, it would commit suicide to avoid the embarassament.

    July 6, 2011 at 11:02 pm |
  14. doc

    Hold your position, sir. It's the right thing to do.

    July 6, 2011 at 11:15 pm |
  15. Liz Carter in Georgia

    @Skytag, Thanks for straigtening that Sank. I don't know what to say to an angry, hateful person like that. It's like talking to a signboard. Somebody recently brought up the admonishment of the Late Great President John F Kennedy to the American People,..'Ask not what your country can do for you, ask what you can do for your country'. I believe that was one of THE most profound statements ever made by an American Democratic President. That's all Pres Obama is asking in so many words! GOP says NO WAY, JOSE!

    July 7, 2011 at 12:24 am |
    • John

      I think a more fitting statement for many "Americans" today is – Ask not what you can do for your country, ask for what your country can do for you".
      BTW, maybe you should mention in all of your posts that you work in a government job. If you do, your comments will look more like propaganda than just another person commenting on this site.

      July 7, 2011 at 7:04 am |
      • jean2009

        Yes,and it seems to be doing an awful lot for the rich at the expense of the middle-class.
        Maintaining the Bush tax cuts for the wealthiest 2% for the next 10 years will cost us $690 billion.

        July 7, 2011 at 5:33 pm |
  16. J.V.Hodgson

    I think this approach makes the most sense, (with the added twist that the president invokes the 14th Amendment and is authorised by congress to do so now by $1.7trillion). The debt ceiling vote specifies a target of $3-4tr in spending cuts and allows taxes to be changed even increased as per a combination of the Presidents debt commission and the Ryan budget in an updatednegotiated Budget plan. The other caveat is that current $1.3 trillion cuts and $400BN tax increase go in now as a provisional step. the effect is to give 12months to negotiate and agree the $4tr spend cuts and tax changes. They have to include significant defense budget cuts and the whole CIA NSA State Homeland security department budgets. Let us all rememeber the deficit comission lowered a lot of taxes.
    I have not heard a single economist who has not agreed that pure spending cuts will not achieve budget balance or debt reduction.In fact most say that route = increasing job losses. But that's Republican strategy anyway at present.
    Regards,
    Hodgson.

    July 7, 2011 at 12:42 am |
  17. M Gonzales

    Of course they want a huge deal, if this comes back in a year from now just before the 2012 election its going to destroy Obama and alot of Democrats chances of getting re-elected.

    July 7, 2011 at 1:48 am |
  18. FedUp

    Of course he wants a huge increase in the national debt limit. Why not? That way he can spend even more money that we don't have.He can party on! Elections are coming up. How would it look have this come up again 4 or 5 more times before his re-election run? Doesn't surprise me that Clinton wants a debt increase too. He's another one of the big government people.

    July 7, 2011 at 8:38 am |
  19. rob

    So now the president is for "a big deal" of 3 to 4 trillion? 6 months ago he proposed a budget that not only carried the stimulus on for eternity but projected deficits of 1 trilliona year for at least the next ten years. It was rightfully laughed off the stage. This is pure political posturing which is parrotted by CNN and the other liberal media without any context of his statements or positions or policies of the past 2 1/2 years. Thank G*D for the internet and more ballanced media outlets. Never has the main stream media been so transparently protecting a political figure.

    Nov. 2012 can't come fast enough.

    July 7, 2011 at 9:11 am |
  20. ja

    the pay should be cut retro year's begining until the mess is fixed, if i don't do my job i don't get paid why should congress, most of congress will not miss it

    July 7, 2011 at 9:29 am |
  21. Joe

    After paying social security for 50 years my wife and I now depend entirely on social security income. Of course millionaires and soon-to-be-millionaires should pay higher taxes – at least restore them to the Reagan years level.

    July 7, 2011 at 10:06 am |
    • Winder

      I hate to say it, but that is one of the problems we have. So many people are totally relying on Social Security, and it was never intended to be the only retirement option people have, and it was originally put at 65, because most people didn't live past 65, so the majority of people wouldn't even benefit from it. Now it is so huge and people depend on it so much, it is going to be hard to reform it, but it will have to be reformed or no one will be able to use it within 20 to 30 years, it will totally break us. Picture Greece but in the USA. The people who set it up to begin with did not intend for it to be used in this fashion.

      July 8, 2011 at 10:46 am |
  22. james john philon

    being down on democracy in this republic isn't great americanism, is it? less for war, less to the poor, less to
    be quiet about. any total apathy patriots and their pursing ladies? i do care about the lame attitudes of this new century supporting babbown terrorisms and neutron bombing on innocent veterans on the homefront in
    2003 under bush and dick cheney in maryland bunker.
    have a good life, you and friends, suffering ms since 1996 and surviving in a nursing home in lafayette in.

    July 7, 2011 at 2:23 pm |
    • jean2009

      My best to you James....my husband also has MS diagnosed at age 50.

      July 7, 2011 at 5:37 pm |
  23. Liz Carter in Georgia

    'It was never intended to be the only retirement option people have'? So are you saying it was a 'ponzie scheme'? Just something that the government designed that it could just go into, use at random on anything it wanted and when the working masses begin to retire, ALL of these AMERICANS who worked and paid into it ALL of their lives to insure some simulance of financial stability, you all start claiming its broke, going broke and it was NOT suppose to be depended upon by the very people who sustained it?

    July 12, 2011 at 3:15 pm |
  24. Liz Carter in Georgia

    At the levels of pay that most working poor were and have been compensated, social security was and is ALL they could pay into or set aside for their retirement years. Many can't nor couldn't afford other programs, 401ks, stocks, thrift savings plans and so forth! They lived from payday to payday, working to pay their bills, eat, clothe themselves and their families the best they could, understanding at least they'd have something to live on when they retired! SS should NOT be a part of this debt issue!

    July 12, 2011 at 4:34 pm |