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Deficit Drives Debate As Congress Rides Shotgun

LIANE HANSEN, Host:

This week in Washington, policymakers will still be wrestling with the domestic economy and the twin burdens of the federal deficit and debt. Many Republicans are seizing on calls from Democrats to raise the nation's debt limit. Here's House budget committee chairman Paul Ryan.

PAUL RYAN: Like John Boehner said, for every dollar the president wants to raise the debt limit, we're saying cut at least a dollar's worth of spending because that is the necessary thing to do to stave off a debt crisis.

HANSEN: In recent decades, the national debt has risen dramatically, and the tide of red ink seems to be carrying all other policy issues with it. NPR's senior Washington editor Ron Elving is in the studio. Hi, Ron.

RON ELVING: Good to be with you, Liane.

HANSEN: So, this week there was a significant moment in the debt struggle. We hit the limit - no more borrowing allowed, right?

ELVING: And the idea is to give the White House and the Congress more time to negotiate a deal so that they can raise the limit again, the way they've done nearly 100 times since World War I.

HANSEN: So, they have until August. Are there negotiations going on?

ELVING: But we may have a serious of stop-gaps where they do it in hundreds of billions and have to come back to it time and again. Now, that would keep the pressure on both sides to keep negotiating but it might not be all that reassuring to the credit markets where the U.S. has to go to borrow money.

HANSEN: And what about the other group - the senators who had a bipartisan group looking into, what, a long-term global deal on the deficit?

ELVING: So, Tom Coburn pulled out of this negotiation with the Democrats, saying the Democrats really had to own up to the difficulties with Medicare and the cost of Medicare in the long run. If he, Tom Coburn, were going to be willing to support any kind of tax increases at all - and that was the predicate of this entire gang of six - that there would be some tax increases to go with larger spending cuts.

HANSEN: We're going to talk more about Coburn's departure from the gang of six in a moment, but what is the Senate going to do with the Ryan budget, the one that the House sent over?

ELVING: So, it's a tough position for the Republicans to be in and they would much rather have a vote on some kind of Democratic budget they could be against.

HANSEN: But what do the Republicans in the Senate want?

ELVING: They would like the Democrats to do essentially what Paul Ryan has done in the House - come forward with something tough-minded, something politically unpopular. And in the case of what Kent Conrad and the other Democrats on the Senate budget committee would likely bring forward, that would probably include some unpopular tax cuts, mostly in discretionary spending rather than in entitlement programs like Medicare. And it would also include some kinds of tax increases, whether they were on corporations or on higher-income individuals, some kind of revenue increases the Republicans would like to be able to vote against.

HANSEN: Do you see any hope on the horizon here?

ELVING: So, if you still believe in a place called hope, you can stay tuned next week.

HANSEN: NPR senior Washington editor Ron Elving. Thanks a lot, Ron.

ELVING: Good to be with you, Liane. Transcript provided by NPR, Copyright NPR.