House Speaker John Boehner (R., Ohio) will mark out a firm Republican position regarding the debt ceiling in his speech this evening at the Economic Club of New York (7 p.m., watch live here). He will insist that while allowing the country to default would be “irresponsible,” voting to raise the debt limit without spending cuts and reforms would be far worse in terms of the economic consequences.
Most significantly, the speaker will demand that any increase to the debt limit be offset by spending cuts of a greater amount. “Without significant spending cuts and reforms to reduce our debt, there will be no debt limit increase,” Boehner plans to say, according to excerpts obtained by National Review Online. “And the cuts should be greater than the accompanying increase in debt authority the president is given. We should be talking about cuts of trillions, not just billions.”
In other words, if President Obama wants to be able to borrow trillions more (and he does), he will have to consider meaningful reforms to entitlement programs — the primary drivers of the country’s debt problem — in exchange for Republican votes.
The measures attached to a debt ceiling increase, Boehner will say, “should be actual cuts and program reforms, not broad deficit or debt targets that punt the tough questions to the future,” and everything is on the table except tax increases, including “honest conversations about how best to preserve Medicare.” Consider that yet another push back against the conventional media narrative that Republicans had “given up” on Medicare reform. “[W]ith millions of Baby Boomers beginning to retire, the status quo [on Medicare] is unsustainable,” Boehner will say.
On taxes, the speaker will reiterate the Republican position that higher taxes will have adverse effects on job creation and economic growth. “Balancing the budget requires spending cuts and economic growth,” he plans to say. “We won’t have economic growth if we raise taxes and fail to address the drivers of our debt. The mere threat of tax hikes causes uncertainty for job creators — uncertainty that results in less risk-taking and fewer jobs.”
Boehner will also go after the Obama administration’s energy policies, claiming that it is “simply untrue” that nothing can be done to reign in rising fuel prices. “Washington has also kept most of our nation’s vast energy resources under lock and key for decades, over the clear objections of the American people — the people who own those resources. If we had listened to the people decades ago — or even a few years ago — many of these resources would be available to us right now to lower the price of energy.”
The current debt limit of $14.3 trillion is expected to be reached shortly, and Treasury Secretary Tim Geithner recently floated an increase of $2 trillion in order to meet the government’s obligations into early 2013. Geithner had urged action from Congress before May 16 but since extended the deadline to August 2.