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US Budget Week: GOP Regroups On Fiscal Issues For Another Year

--Intraparty Tensions Complicate GOP Effort To Sue For Peace On Debt Hike
--Congress Sends Obama Debt-Ceiling Suspension Bill Until March 15, 2015
--Budget Expert: Hill Vote To Cancel Modest Entitlement Reform 'Deeply
Discouraging'

By John Shaw

     WASHINGTON (MNI) - It's difficult to view the Republican decision this week
to allow for congressional passage of clean debt suspension legislation as
anything other than a GOP agreement to sue for fiscal peace until after the
mid-term elections in November.

     With Republicans hopeful they will retain control of the House and possibly
win control of the Senate, party leaders seem to have decided that a contentious
fiscal fight with Democrats makes no sense.

     Over the past three years, House Speaker John Boehner and Senate Minority
Leader Mitch McConnell have led congressional Republicans into the fiscal fray,
with President Barack Obama and Senate Majority Leader Harry Reid spearheading
the Democratic response.

     It was Boehner, at a Tuesday morning briefing at a conference room at the
Republican National Committee's offices on Capitol Hill, who formally raised the
white flag.

     In response to a question, he tersely announced that the House would be
voting on a clean bill to suspend the debt ceiling until March 15, 2015.

     "You've all known that our members are not crazy about voting to increase
the debt ceiling," Boehner said to reporters.

     "Our members are also very upset with the president. He won't negotiate. He
won't deal with our long-term spending problems without us raising taxes. He
won't even sit down and discuss these issues. He's the one driving up the debt
and the question they're (House Republicans) asking us is, why should I deal
with his debt limit? So the fact is, we'll let the Democrats put the votes up,
we'll put a minimum number of votes up to get it passed," Boehner said.

     For those who have followed the fiscal battle between the GOP and the White
House, Boehner's comments were a nearly Shakespearean reversal of fortunes from
a position he staked out three years earlier.

     In a speech to the Economic Club of New York on May 9, 2011, Boehner vowed
to use the debt ceiling as leverage to compel Obama and congressional Democrats
to accept major entitlement reforms.

     "It is true that allowing America to default would be irresponsible. But it
would be even more irresponsible to raise the debt ceiling without
simultaneously taking dramatic steps to reduce spending and reform the budget
process. To increase the debt limit without simultaneously addressing the
drivers of our debt - in defiance of the will of our people - would be
monumentally arrogant and massively irresponsible" Boehner said.

     He added: "So let me be as clear as I can be. Without significant spending
cuts and reforms to reduce our debt, there will be no debt-limit increase. And
the cuts should be greater than the accompanying increase in debt authority the
president is given," he said.

     This vow led to high stakes fiscal negotiations in the summer of 2011 that
resulted in the Budget Control Act which secured more than $2 trillion in mostly
discretionary savings in exchange for a debt limit increase of about that same
size.

     But Republicans decided this year, in the aftermath of this last fall's 16
day government shutdown and debt ceiling stalemate, there was little to be
gained by another debt ceiling battle with the president.

     The House passed the debt ceiling suspension bill Tuesday on a 221-to-201
vote.

     The Senate voted 55 to 43 Wednesday to approve the same debt ceiling bill,
sending it to  Obama for his signature.

     The GOP decision to capitulate on the debt ceiling generated some intra-GOP
discord. That discord played out during an astonishing hour on the Senate floor
Wednesday during which Republican leaders essentially negotiated among
themselves in full public view about which senators would cast the votes needed
to allow the debt ceiling to go forward.

     After Republican Senator Ted Cruz demanded a 60-vote threshold to end
debate on the debt ceiling bill, McConnell and Senate Minority Whip John Cornyn
reluctantly decided to support the Democratic motion to end debate on the bill.
They were ultimately joined by 10 other Republican senators in supporting the
motion.

     All Senate Republicans voted against the actual debt ceiling suspension
bill in the following  vote. Both McConnell and Cornyn face primary challenges
this year and both of their opponents scorched the GOP leaders for supporting
the procedural motion.

     Bob Bixby, the executive director of the Concord Coalition, said the GOP
decision not to battle over the debt ceiling this year appears driven by the
view that this fight would gain them little either in public policy or political
terms.

     "Republican leaders clearly have no appetite to get into a messy budget
fight with Obama and congressional Democrats this year. It would lead to no
productive policy conclusion from their perspective and could only hurt them in
the November mid-term elections," he said.

     Bixby said that while the GOP's debt ceiling reversal was striking to
observe, the most consequential fiscal policy action of the week was the large
bipartisan vote in both chambers to rescind a recently enacted 1 percentage
point reduction in cost-of-living adjustments for veterans under 62.

     "This was the one hard choice that was made a few months ago in the
Ryan-Murray budget agreement," Bixby said, referring to the December budget
agreement by House Budget Committee Chairman Paul Ryan and Senate Budget
Committee Chairman Patty Murray.

     "While the cost of this decision was not big in dollar amounts, the message
this vote sends is huge. The message Congress sent is this: 'Even if we talk
about supporting entitlement reform, we don't really mean it.'  When it comes to
specific steps to actually scale-back specific entitlement programs both parties
oppose those - by huge majorities. This is deeply, deeply discouraging," Bixby
said.

--MNI Washington Bureau; tel: +1 202-371-2121; email: jshaw@mni-news.com

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US Budget Week: GOP Regroups On Fiscal Issues For Another Year

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