By Jackie Calmes,Â New York Times
WASHINGTON — The House on Tuesday overwhelmingly rejected a measure to increase the government’s debt limit, acting on a vote staged by Republican leaders to pressure President Barack Obama to agree to deep spending cuts.
The measure, defeated 318-97, was brought up by Republicans to show that there was little House support for raising the $14.3 trillion debt ceiling without concrete steps to rein in chronic budget deficits.
It followed several acts of odd political theater on the House floor: Republicans brought up the measure and then urged its defeat, while Democrats — who not long ago were seeking just such a vote to raise the debt ceiling without attaching spending cuts — assailed Republicans for bringing it up, saying its certain defeat might unnerve the financial markets.
Just in case, Republican leaders scheduled the vote for after the stock market’s close and, in the preceding days, called Wall Street executives to assure them that the vote was just for show, to make the point to Obama that he would have to make concessions in budget negotiations if any debt-limit increase is to pass Congress.
“This vote, based on legislation I’ve introduced, will and must fail,” said Rep. Dave Camp, R-Mich., chairman of the Ways and Means Committee.
Rep. Chris Van Hollen of Maryland, the senior Democrat on the Budget Committee, objected.
“This is a political stunt,” he said.
Voting against the measure were 236
Republicans and 82 Democrats. No Republicans voted in favor.
For all the talk of crisis should Congress fail to raise the debt ceiling by Aug. 2, when the Treasury Department says it will run out of room to meet all the government’s obligations without further borrowing, the financial markets are likely to yawn at Tuesday’s proceedings.
“Wall Street is in on the joke,” said R. Bruce Josten, executive vice president of the U.S. Chamber of Commerce.
But beyond this week, Wall Street has reason to be nervous as the issue plays out, said people in both parties and in finance, some of whom asked not to be identified given the sensitivity of the issue.
Investors have grown accustomed to partisan games of chicken that always end with the needed increase in the government’s borrowing authority. But this showdown, many say, is riskier because of the strongly held antispending, antitax views of the many freshman House Republicans combined with the fragility of the economic recovery.
To read more, visit:Â http://www.mercurynews.com/politics-government/ci_18178542?source=rss&nclick_check=1
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