Rep. Paul Ryan awaiting details on debt deal
As negotiations and compromises continue in a congressional impasse over the federal government’s debt ceiling, U.S. Rep Paul Ryan, R-Wis., said Friday he and his staff worked this week as a think tank for House Republicans.
As House Budget Committee Chairman, Ryan has helped crunch budget numbers and draft a bill on the debt ceiling that he said House Republicans will bring to the floor Tuesday.
Ryan said the bill would cut and cap federal spending but allow a debt limit increase and call for a balanced budget amendment. Both parties and the White House have until Aug. 2 to solve the problem, or the U.S. government could face default on its debt.
In a phone interview with the Gazette, Ryan would not give specifics on spending cuts Republicans seek in the bill, saying lawmakers still were in the midst of working on a compromise.
But Ryan answered several questions on the debt ceiling issue, which appears to have divided Republicans in Congress at a time when both parties are running short on time to agree on a plan that will allow the government to pay its bills.
Q: U.S. Sen. Mitch McConnell has floated a compromise that could lay the debt ceiling increase in the hands of the President Barack Obama and couple it with a plan with federal spending cuts, which Republicans suggest could total $1.5 trillion. That’s less than the $2.4 trillion in cuts Republicans say is needed to balance out the debt limit increase proposed by the White House. Where do you stand on this sort of a compromise?
A: “I’m withholding judgment on it right now. I’d like to see the details instead of making positions based on hypotheticals. That idea is still alive, it’s still discussed. Right now, our (Republican) negotiators are trying to get to spending cuts. … The question is how much spending cuts we can get from this president. Clearly not enough to fix our fiscal problems.”
Q: But is this kind of compromise a step in the direction in which a solution is likely to come?
A: “Look, no matter how much the president wants to raise taxes, you can’t address this problem with tax increases. Spending is the problem. … The kinds of spending cuts being talked about fall so far short of what’s necessary to avoid a debt crisis in this country. ... This moment I don’t believe will be the one where we’ll solve all of our fiscal problems, but we’ll get a down payment on them.”
Q: Some Republicans in Congress have warned the GOP could stand to take blame from the president for a bad economy if the federal government doesn’t reach a solution on its debt limit by Aug. 2. Officials from the Federal Reserve and major American banks have warned a default would mean a financial mess, saying it would be akin to the federal government shooting the U.S. economy in the foot. Are you concerned by those implications?
A: “Of course I’m concerned if we actually had a default. Of course. I think default is highly unlikely. … I think … nobody is adopting a strategy of moving us toward default. The problem is if we just raise the debt limit without doing anything, like the president has asked, that, too, will undermine confidence in the bond markets and could trigger a debt downgrade. … We (Republicans) are trying to get some spending controls so we can get a down payment on the problem to avoid a debt crisis.”
Q: Some Republican lawmakers seem to be leaning toward a compromise with the White House on the debt ceiling, while some freshman Republicans continue to only want deep spending cuts. Some consider this a major division in the Republican Party and put it at the heart of the political deadlock on the issue. Where do you stand? Do you think there’s a major division among Republicans?
A: “It’s not a division within the party. It’s more of an argument over tactics, not principals. An example is (U.S. Rep.) Michele (Bachmann). She’s probably the most prominent ‘I will vote for nothing’ person. She’s said under no circumstances will she vote for a debt limit increase. It’s a position derived out of frustration with all the spending and the desire to reduce spending and cut government. Anybody who’s fighting for fiscal responsibility on our side of the aisle shares those principals. It’s just that some people differ over tactics.
“I believe it’s important that we cut spending to keep our interest rates low so our economy has a chance to heal. That’s what’s most important, here.”
Q: Moody’s Investor Services is reviewing a possible downgrade of the U.S. government’s bond rating over the specter of a default and unpaid debt. And credit rating agency Standard and Poor’s said because of the impasse, there’s a 50 percent chance it could downgrade the government’s credit in coming months. What are your thoughts?
A: “These warnings were coming with or without this impasse over the debt limit. They were coming because of our fiscal problems. It was becoming clear that our government wasn’t getting our fiscal house in order. This impasse shows you the difficulty we’re having in cutting a modest amount of spending over a 10-year period. … We’re spending money we don’t have. Our debt has skyrocketed.”
Q: Do you think the warnings should come as a wakeup call for both Republicans and Democrats?
A: “If it came as a shock to anyone, I hope it will serve as a wakeup call.”
The Associated Press contributed to the questions in this story.