Political Buzz Debt Ceiling Showdown, July 22, 2011: Debt Talks Break Down — John Boehner Walks Away from President Obama & Negotiations


By Bonnie K. Goodman

Ms. Goodman is the Editor of History Musings. She has a BA in History & Art History & a Masters in Library and Information Studies from McGill University, and has done graduate work in history at Concordia University.


Stephen Crowley/The New York Times

President Obama made a statement addressing the break down of debt ceiling talks in Washington on Friday.


Obama says Boehner “walked away” from debt talks: President Obama said House Speaker John A. Boehner broke off talks over crafting a “big deal” that would avert a federal default. He called the deal the White House was offering “extraordinarily fair” and said that “if it was unbalanced it was unbalanced in the direction of not enough revenue.”
The president said he was summoning congressional leaders to the White House Saturday morning at 11 a.m. “We have run out of time and they are going to have to explain to me how it is that we are going to avoid default,” he said.

Talks in the effort to avert a government default have collapsed, GOP aides say: Negotiations between the White House and House Speaker John Boehner over an agreement to cut spending, overhaul the tax code and avert a government default have broken down, according to senior House Republican aides. Boehner planned to notify his caucus Friday night.

“In the end, we couldn’t connect. Not because of different personalities, but because of different visions for our country.” — House Speaker John Boehner

“This was an extraordinarily fair deal. If it was unbalanced, it was unbalanced in the direction of not enough revenue. It is hard to understand why Speaker Boehner would walk away from this kind of deal.” — President Barack Obama

  • Debt talks break down; “We have run out of time”: “We have run out of time,” Mr. Obama said in acknowledging the breakdown.
    “It is hard to understand why Speaker Boehner would walk away from this kind of deal and frankly, if you look at the commentary out there, there are a lot of Republicans that are puzzled as to why it couldn’t get done,” he said. “In fact, there are a lot of Republican voters out there who are puzzled as to why it couldn’t get done.”
    Mr. Obama at one point suggested he “couldn’t get a phone call returned” from Boehner earlier in the day, and said that when it comes to a deal, “I’ve been left at the altar now a couple of times.” He said he was unable to guarantee that Social Security checks and other obligations would go out after the August 2 deadline, and said the blame falls on House Republicans who have been unwilling to compromise to get a deal done.
    Mr. Obama said he was calling Congressional leaders to the White House Saturday morning at 11:00 “to explain to me how we are going to avoid default,” acknowledging that discussions were basically back to square one.
    “What this came down to is there doesn’t seem to be a capacity for them to say yes,” Mr. Obama said.
    “I think the challenge really has to do with the seeming inability, particularly in the House of Representatives, to arrive at any kind of position that compromises any of their ideological preferences,” he said. “None. And you’ve heard it. I’m not making this up. I think there are a number of members of that caucus that have been very clear about that.”
    Asked what he would say to calm skittish markets, Mr. Obama said, “I remain confident that we will get an extension of the debt limit and we will not default,” but he was less confident that the GOP will step up and deal with underlying debt and deficits “in a way that is fair.” He said he would be willing to sign a debt limit increase that did not include deficit reduction measures if presented such a bill by Congress.
    The president acknowledged that the Democratic leadership in Congress had not signed off on the proposed deal. He said, however, that both he and the leadership “were willing to engage in serious negotiations despite a lot of heat from a lot of interest groups around the country in order to make sure that we actually dealt with this problem.”
    The proposed cuts to entitlements had angered many Democrats and interest groups, and in announcing that he had offered $650 million in cuts on that front over ten years, Mr. Obama said, “We believed that it was possible to shape those in a way that preserved the integrity of the system, made them available for the next generation and did not affect current beneficiaries in an adverse way.”
    “I was willing to try to persuade Democratic leadership as well as Democratic members of Congress that even a deal that is not as balanced as I think it should be, is better than no deal at all,” he said. “And I was willing to persuade Democrats that getting a handle on debt and deficit reduction is important to Democrats just as much as it’s important to Republicans. And frankly a lot of Democrats were persuaded by that.”… – CBS News, 7-22-11
  • Boehner abruptly withdraws from talks with Obama: House Speaker John Boehner abruptly broke off talks with President Barack Obama Friday night on a deal to cut federal spending and avert a threatened government default, sending compromise efforts into an instant crisis.
    Within minutes, an obviously peeved Obama virtually ordered congressional leaders to the White House for a Saturday meeting on raising the nation’s debt limit. “We’ve got to get it done. It is not an option not to do it,” he declared.
    For the first time since negotiations began, he declined to offer assurances, when asked, that default would be avoided. Moments later, however, he said he was confident of that outcome.
    At a news conference of his own a short while later, Boehner said, “I want to be entirely clear. No one wants default.”
    In a letter circulated earlier to the House Republican rank and file, said he had withdrawn from the talks with Obama because “in the end, we couldn’t connect.”
    He said the president wanted to raise taxes, and was reluctant to agree to cuts in benefit programs…. – AP, 7-22-11
  • Debt Ceiling Talks Collapse as Boehner Walks Out: An angry and frustrated President Obama accused Republican leaders on Friday night of walking away from “an extraordinarily fair deal” to raise the nation’s debt limit.
    In a hastily called news conference at the White house, a grim-faced Mr. Obama demanded that congressional leaders appear at the White House on Saturday.
    “I want them here at 11 a.m. tomorrow,” Mr. Obama told reporters. “They are going to have to explain to me how it is that we are going to avoid default.”
    The president spoke moments after House Speaker John A. Boehner, the Republican from Ohio, released a letter that he had sent to House colleagues, saying he was breaking off the budget negotiations because of differences over revenues and would instead try to strike an agreement with Senate leaders to raise the debt limit by Aug 2 and avoid sending the government into a potential default.
    “In the end, we couldn’t connect,” Mr. Boehner said. “Not because of different personalities, but because of different visions for our country.”
    In his comments, Mr. Obama described a deal of spending cuts that he said was more generous than what the so-called Gang of Six had offered and said it was “hard to understand” why Mr. Boehner would walk away…. – NYT, 7-22-11
  • Boehner calls off debt talks with Obama: House Speaker John Boehner told President Obama tonight he is pulling out of debt negotiations to work directly with the Senate about a fall-back plan to lift the nation’s $14.3 trillion debt ceiling by the Aug. 2 deadline.
    In response, Obama said he is summoning House and Senate leaders to the White House Saturday morning “to explain to me how we are going to avoid default.” “We are running out of time,” Obama said.
    The Treasury Department has said that if the debt ceiling is not lifted by Aug. 2 — a week from Tuesday — it will lose borrowing authority to pay the government’s bills and face default…. – USA Today, 7-22-11
  • Obama scolds GOP as debt talks break down: ‘Where’s the leadership?’: In an unusual display of emotion, President Obama angrily responded to House Speaker John A. Boehner’s abrupt withdrawal from talks on a debt ceiling increase, and summoned congressional leaders to the White House on Saturday for emergency talks to plot a new course before the Aug. 2 deadline.
    “We have run out of time,” the president said in a hastily-called news briefing, just moments after Boehner informed him of his decision.
    On Thursday, Obama and Boehner appeared to be closing in on a deal that would have raised the debt ceiling through 2013, combined with spending cuts and entitlement reforms to achieve $3 trillion in deficit reduction.
    But talks apparently broke down in a dispute over taxes. Obama, prodded by Democrats, insisted that any deal include new revenues in addition to spending cuts…. – LAT, 7-22-11
  • Boehner Pulls Out of Debt Talks: House Speaker John Boehner (R., Ohio) has decided to no longer pursue a major deficit-reduction deal with the White House and informed President Barack Obama of his decision Friday night, House Republican leadership aides said late Friday.
    “In the end we couldn’t connect. Not because of different personalities, but because of different visions for our country,” Mr. Boehner wrote in a letter to his colleagues. “I have decided to end discussions with the White House and begin conversations with the Senate in an effort to find a path forward.”
    The speaker’s office reached out to Senate leaders Friday to begin to figure out what the path forward is, Republican officials said. House and Senate negotiators will hold talks through the weekend to try to determine what kind of agreement they could reach to raise the government’s debt ceiling by Aug. 2 and prevent a government default.
    Senior Republican aides said they didn’t know what shape a deal would ultimately take, but they said they needed to present House members with an agreement by Monday to have time to pass legislation in both chambers by Aug. 2.
    “We know we have a short window of time here,” a senior Republican aide said.
    After a series of discussions between administration officials and the House leadership, it became clear, the GOP aides said, that the White House and Congress’s interests were not aligned…. – WSJ, 7-22-11
  • John Boehner walks away from debt talks: House Speaker John Boehner has walked away from negotiations with President Obama over a deal to raise the debt limit.
    “In the end, we couldn’t connect. Not because of different personalities, but because of different visions for our country,” Boehner said in a letter to colleagues. He said Mr. Obama ” is emphatic that taxes have to be raised” and “adamant that we cannot make fundamental changes to our entitlement programs.”
    “For these reasons, I have decided to end discussions with the White House and begin conversations with the leaders of the Senate in an effort to find a path forward,” he said. (Read the letter here)
    House Republican leadership aides told CBS News that Boehner will work with the Senate leadership in an attempt to reach a deal that meets the GOP’s two central requirements: That spending cuts are equal to or greater than debt limit increase and that there are no new taxes…. – CBS New, 7-22-11
  • Obama-Boehner talks collapse; each side blames the other: Debt-reduction negotiations between President Obama and House Speaker John A. Boehner collapsed Friday, derailing an effort to reach a landmark agreement to cut spending, overhaul the tax code and avert a government default.
    In subsequent statements, both sides blamed the other for an impasse that threatens to plunge the nation into a fiscal crisis if the government fails to meet a looming deadline to raise the federal debt ceiling.
    Announcing the collapse, Boehner (R-Ohio) said he could not overcome disputes with Obama on taxes and entitlements.
    Appearing before reporters at the White House, Obama said he had been willing to agree to a deal that was more generous to Republican interests than to those of his fellow Democrats. “It’s hard to understand why Speaker Boehner would walk away from this kind of deal,” he said. “The vast majority of the American people believe we should have a balanced approach” between revenues and cuts.
    Saying that “we have now run out of time,” Obama summoned Boehner, House Minority Leader Nancy Pelosi (D-Calif.), Senate Majority Leader Harry M. Reid (D-Nev.) and Senate Minority Leader Mitch McConnell (R-Ky.) to the White House at 11 a.m. Saturday.
    “They’re going to have to explain to me how it is that we are going to avoid a default,” he said. He later said he was confident that a default could be avoided…. – WSJ, 7-22-11
  • Obama allows for possibility of default, saying ‘if’ instead of expressing confidence US won’t: President Barack Obama for the first time has allowed for the possibility that the U.S. may default on its financial obligations.
    At a hastily arranged White House appearance on Friday, Obama said: “If we default, then we’re going to have to make adjustments.”
    But minutes later, the president said he remained confident that the debt limit will be extended. Said Obama: “We will not default. I am confident of that.”… – Washingtn Post, 7-22-11
  • Debt talks break down; Volatility ahead: Shortly before the latest bust up in Washington, Kathy Lien Director, Global Research & Analysis at GFT wrote:

    Barack Obama’s Presidency and his chance of reelection could very well be defined by what happens over the next week. If the Senate fails to raise the debt ceiling either temporarily or permanently, panic selling of U.S. dollars could drive the greenback to fresh lows against all of the major currencies. The weakness of USD/JPY and USD/CHF confirms that investors are worried about the developments or the lack thereof in the coming week.

    Ultimately there are three scenarios, according to Lien:

    Scenario 1 – Watered Down Debt Deal Passed – Very Dollar Bullish Scenario 2 – Temporary Increase to Debt Ceiling – Mildly Dollar Bullish Scenario 3 – Throw Up their Hands and Let the U.S. Default – Very Dollar Bearish

    For not it appears we’ve moved closer to scenario 2…. – CBS Market Watch, 7-22-11

Full Text Debt Ceiling Showdown, July 22, 2011: Speaker John Boehner’s Letter to House Republicans on Why Debt Talks with President Obama Broke Down



Boehner’s letter to House Republicans on debt talks

House Speaker John Boehner (R-Ohio) sent the following letter to members of the House Republican conference Friday evening as debt ceiling talks, negotiations with Obama & White House broke down.

Original PDF

Dear Colleague,

Our economy is not creating enough jobs, and the policies coming out of Washington are a big reason why. Because of Washington, we have a tax code that is stifling job creation. Because of Washington, we have a debt crisis that is sowing uncertainty and sapping the confidence of small businesses. Because of Washington, our children are financing a government spending binge that is jeopardizing their future.

Since the moment I became Speaker, I’ve urged President Obama to lock arms with me and seize this moment to do something significant to address these challenges. I’ve urged him to partner with congressional Republicans to do something dramatic to change the fiscal trajectory of our country . . . something that will boost confidence in our economy, renew a measure of faith in our institutions of government, and help small businesses get back to creating jobs.

The House this week passed such a plan . . . the Cut, Cap & Balance Act, which passed the House with bipartisan support.

Along with Majority Leader Cantor, I have also engaged the president in a dialogue in recent days. The purpose of this dialogue was to see if we could identify a path forward that would implement the principles of Cut, Cap, & Balance in a manner that could secure bipartisan support and be signed into law.

During these discussions — as in my earlier discussions — it became evident that the White House is simply not serious about ending the spending binge that is destroying jobs and endangering our children’s future.

A deal was never reached, and was never really close.

In the end, we couldn’t connect. Not because of different personalities, but because of different visions for our country.

The president is emphatic that taxes have to be raised. As a former small businessman, I know tax increases destroy jobs.

The president is adamant that we cannot make fundamental changes to our entitlement programs. As the father of two daughters, I know these programs won’t be there for their generation unless significant action is taken now.

For these reasons, I have decided to end discussions with the White House and begin conversations with the leaders of the Senate in an effort to find a path forward.

The Democratic leaders of the House and Senate have not been participants in the conversations I and Leader Cantor have had with the White House; nor have the Republican leaders of the Senate. But I believe there is a shared commitment on both sides of the aisle to producing legislation that will serve the best interests of our country in the days ahead — legislation that reflects the will of the American people, consistent with the principles of the Cut, Cap, & Balance Act that passed the House with bipartisan support this week.

I wanted to alert you to these developments as soon as possible. Further information will be coming as soon as it is available. It is an honor to serve with you. Together, we will do everything in our power to end the spending binge in Washington and help our economy get back to creating jobs.


John Boehner

Full Text Debt Ceiling Showdown, July 22, 2011: President Obama’s Statement & Remarks to the Press about the Break Down, Collapse of Debt Ceiling Negotiations with Speaker John Boehner



Remarks by the President

James S. Brady Press Briefing Room

6:06 P.M. EDT

THE PRESIDENT: Good evening, everybody. I wanted to give you an update on the current situation around the debt ceiling. I just got a call about a half hour ago from Speaker Boehner who indicated that he was going to be walking away from the negotiations that we’ve been engaged in here at the White House for a big deficit reduction and debt reduction package. And I thought it would be useful for me to just give you some insight into where we were and why I think that we should have moved forward with a big deal.

Essentially what we had offered Speaker Boehner was over a trillion dollars in cuts to discretionary spending, both domestic and defense. We then offered an additional $650 billion in cuts to entitlement programs — Medicare, Medicaid, Social Security. We believed that it was possible to shape those in a way that preserved the integrity of the system, made them available for the next generation, and did not affect current beneficiaries in an adverse way.

In addition, what we sought was revenues that were actually less than what the Gang of Six signed off on. So you had a bipartisan group of senators, including Republicans who are in leadership in the Senate, calling for what effectively was about $2 trillion above the Republican baseline that they’ve been working off of. What we said was give us $1.2 trillion in additional revenues, which could be accomplished without hiking taxes — tax rates, but could simply be accomplished by eliminating loopholes, eliminating some deductions and engaging in a tax reform process that could have lowered rates generally while broadening the base.

So let me reiterate what we were offering. We were offering a deal that called for as much discretionary savings as the Gang of Six. We were calling for taxes that were less than what the Gang of Six had proposed. And we were calling for modifications to entitlement programs, would have saved just as much over the 10-year window. In other words, this was an extraordinarily fair deal. If it was unbalanced, it was unbalanced in the direction of not enough revenue.

But in the interest of being serious about deficit reduction, I was willing to take a lot of heat from my party — and I spoke to Democratic leaders yesterday, and although they didn’t sign off on a plan, they were willing to engage in serious negotiations, despite a lot of heat from a lot of interest groups around the country, in order to make sure that we actually dealt with this problem.

It is hard to understand why Speaker Boehner would walk away from this kind of deal. And, frankly, if you look at commentary out there, there are a lot of Republicans that are puzzled as to why it couldn’t get done. In fact, there are a lot of Republican voters out there who are puzzled as to why it couldn’t get done. Because the fact of the matter is the vast majority of the American people believe we should have a balanced approach.

Now, if you do not have any revenues, as the most recent Republican plan that’s been put forward both in the House and the Senate proposed, if you have no revenues at all, what that means is more of a burden on seniors, more drastic cuts to education, more drastic cuts to research, a bigger burden on services that are going to middle-class families all across the country. And it essentially asks nothing of corporate jet owners, it asks nothing of oil and gas companies, it asks nothing from folks like me who’ve done extremely well and can afford to do a little bit more.

In other words, if you don’t have revenues, the entire thing ends up being tilted on the backs of the poor and middle-class families. And the majority of Americans don’t agree on that approach.

So here’s what we’re going to do. We have now run out of time. I told Speaker Boehner, I’ve told Democratic Leader Nancy Pelosi, I’ve told Harry Reid, and I’ve told Mitch McConnell I want them here at 11:00 a.m. tomorrow. We have run out of time. And they are going to have to explain to me how it is that we are going to avoid default. And they can come up with any plans that they want and bring them up here and we will work on them. The only bottom line that I have is that we have to extend this debt ceiling through the next election, into 2013.

And the reason for it is we’ve now seen how difficult it is to get any kind of deal done. The economy is already weakened. And the notion that five or six or eight months from now we’ll be in a better position to try to solve this problem makes no sense.

In addition, if we can’t come up with a serious plan for actual deficit and debt reduction, and all we’re doing is extending the debt ceiling for another six, seven, eight months, then the probabilities of downgrading U.S. credit are increased, and that will be an additional cloud over the economy and make it more difficult for us and more difficult for businesses to create jobs that the American people so desperately need.

So they will come down here at 11:00 a.m. tomorrow. I expect them to have an answer in terms of how they intend to get this thing done over the course of the next week. The American people expect action. I continue to believe that a package that is balanced and actually has serious debt and deficit reduction is the right way to go. And the American people I think are fed up with political posturing and an inability for politicians to take responsible action as opposed to dodge their responsibilities.

With that, I’m going to take some questions.


Q Thank you, Mr. President. You said you want the leaders back here at 11:00 a.m. to give you an answer about the path forward. What is your answer about the path forward? What path do you prefer, given what’s just happened? And also, sir, quickly, what does this say about your relationship with Speaker Boehner?

THE PRESIDENT: Well, with respect to my relationship with Speaker Boehner, we’ve always had a cordial relationship. We had very intense negotiations — I’m going to have my team brief you exactly on how these negotiations proceeded. Up until sometime early today when I couldn’t get a phone call returned, my expectation was that Speaker Boehner was going to be willing to go to his caucus and ask them to do the tough thing but the right thing. I think it has proven difficult for Speaker Boehner to do that. I’ve been left at the altar now a couple of times.

And I think that one of the questions that the Republican Party is going to have to ask itself is can they say yes to anything? Can they say yes to anything? I mean, keep in mind it’s the Republican Party that has said that the single most important thing facing our country is deficits and debts. We’ve now put forward a package that would significantly cut deficits and debt. It would be the biggest debt reduction package that we’ve seen in a very long time.

And it’s accomplished without raising individual tax rates. It’s accomplished in a way that’s compatible with the “no tax” pledge that a whole bunch of these folks signed on to — because we were mindful that they had boxed themselves in and we tried to find a way for them to generate revenues in a way that did not put them in a bad spot.

And so the question is, what can you say yes to? Now, if their only answer is what they’ve presented, which is a package that would effectively require massive cuts to Social Security, to Medicare, to domestic spending, with no revenues whatsoever, not asking anything from the wealthiest in this country or corporations that have been making record profits — if that’s their only answer, then it’s going to be pretty difficult for us to figure out where to go. Because the fact of the matter is that’s what the American people are looking for, is some compromise, some willingness to put partisanship aside, some willingness to ignore talk radio or ignore activists in our respective bases, and do the right thing.

And to their credit, Nancy Pelosi, Harry Reid, the Democratic leadership, they sure did not like the plan that we are proposing to Boehner, but they were at least willing to engage in a conversation because they understood how important it is for us to actually solve this problem. And so far I have not seen the capacity of the House Republicans in particular to make those tough decisions.

And so then the question becomes, where’s the leadership? Or, alternatively, how serious are you actually about debt and deficit reduction? Or do you simply want it as a campaign ploy going into the next election?

Now, in terms of where we go next, here’s the one thing that we’ve got to do. At minimum, we’ve got to increase the debt ceiling. At minimum. I think we need to do more than that. But as I’ve said before, Republican Leader McConnell in the Senate put forward a plan that said he’s going to go ahead and give me the responsibility to raise the debt ceiling. That way folks in Congress can vote against it, but at least it gets done. I’m willing to take the responsibility. That’s my job. So if they want to give me the responsibility to do it, I’m happy to do it.

But what we’re not going to do is to continue to play games and string this along for another eight, nine months, and then have to go through this whole exercise all over again. That we’re not going to do.

Jessica Yellin.

Q Standing here tonight, Mr. President, can you assure the American people that they will get their Social Security checks on August 3rd? And if not, who’s to blame?

THE PRESIDENT: Well, when it comes to all the checks, not just Social Security — veterans, people with disabilities — about 70 million checks are sent out each month — if we default then we’re going to have to make adjustments. And I’m already consulting with Secretary Geithner in terms of what the consequences would be.

We should not even be in that kind of scenario. And if Congress — and in particular, the House Republicans — are not willing to make sure that we avoid default, then I think it’s fair to say that they would have to take responsibility for whatever problems arise in those payments. Because, let me repeat, I’m not interested in finger-pointing and I’m not interested in blame, but I just want the facts to speak for themselves.

We have put forward a plan that is more generous to Republican concerns than a bipartisan plan that was supported by a number of Republican senators, including at least one that is in Republican leadership in the Senate. Now, I’ll leave it up to the American people to make a determination as to how fair that is. And if the leadership cannot come to an agreement in terms of how we move forward, then I think they will hold all of us accountable.

But that shouldn’t even be an option. That should not be an option. I’m getting letters from people who write me and say, at the end of every month I have to skip meals. Senior citizens on Social Security who are just hanging on by a thread. Folks who have severe disabilities who are desperate every single month to try to figure out how they’re going to make ends meet. But it’s not just those folks. You’ve got business contractors who are providing services to the federal government, who have to wonder are they going to be able to get paid and what does that do in terms of their payrolls.

You’ve got just a huge number of people who, in one way or another, interact with the federal government. And even if you don’t, even if you’re not a recipient of Social Security, even if you don’t get veterans’ benefits or disabilities, imagine what that does to the economy when suddenly 70 million checks are put at risk. I mean, if you’re a business out there, that is not going to be good for economic growth. And that’s the number one concern of the American people.

So we’ve got to get it done. It is not an option not to do it.

Q And your degree of confidence?

THE PRESIDENT: I am confident simply because I cannot believe that Congress would end up being that irresponsible that they would not send a package that avoids a self-inflicted wound to the economy at a time when things are so difficult.

Scott Horsley.

Q Mr. President, can you explain why you were offering a deal that was more generous than the Gang of Six, which you seemed to be embracing on Tuesday when you were here?

THE PRESIDENT: Because what had become apparent was that Speaker Boehner had some difficulty in his caucus. There are a group of his caucus that actually think default would be okay and have said that they would not vote for increasing the debt ceiling under any circumstances.

And so I understand how they get themselves stirred up and the sharp ideological lines that they’ve drawn. And ultimately, my responsibility is to make sure that we avoid extraordinary difficulties to American people and American businesses.

And so, unfortunately, when you’re in these negotiations you don’t get 100 percent of what you want. You may not even get 60 or 70 percent of what you want. But I was willing to try to persuade Democratic leadership as well as Democratic members of Congress that even a deal that is not as balanced as I think it should be is better than no deal at all. And I was willing to persuade Democrats that getting a handle on debt and deficit reduction is important to Democrats just as much as it’s important to Republicans — and, frankly, a lot of Democrats are persuaded by that.

As I said in the last press conference, if you’re a progressive you should want to get our fiscal house in order, because once we do, it allows us to then have a serious conversation about the investments that we need to make — like infrastructure, like rebuilding our roads and our bridges and airports, like investing more in college education, like making sure that we’re focused on the kinds of research and technology that’s going to help us win the future. It’s a lot easier to do that when we’ve got our fiscal house in order. And that was an argument that I was willing to go out and make to a lot of skeptical Democrats, as you saw yesterday.

But ultimately, that’s what we should expect from our leaders. If this was easy it would have already been done. And I think what a lot of the American people are so disappointed by is this sense that all the talk about responsibility, all the talk about the next generation, all the talk about making sacrifices, that when it comes to actually doing something difficult folks walk away.

Last point I’ll make here. I mean, I’ve gone out of my way to say that both parties have to make compromises. I think this whole episode has indicated the degree to which at least a Democratic President has been willing to make some tough compromises. So when you guys go out there and write your stories, this is not a situation where somehow this was the usual food fight between Democrats and Republicans. A lot of Democrats stepped up in ways that were not advantageous politically. So we’ve shown ourselves willing to do the tough stuff on an issue that Republicans ran on.


Q Mr. President, there seems to be an extraordinary breakdown of trust involved here. And I wonder if you could address what we’re hearing from Republicans, which is that there was a framework and a deal that was agreed with your chief of staff, with the Treasury Secretary, about a certain number of revenues, that the Republicans had agreed to that. And then after you brought that to your party and the discussion of that, the goal line was moved. Is this an example of where the goal line has moved and that that’s what has led to this breakdown in trust?

THE PRESIDENT: Norah, what I’ll do is we’ll do a tick-tock, we’ll go through all the paper. We’ll walk you through this process. What this came down to was that there doesn’t seem to be a capacity for them to say yes.

Now, what is absolutely true is we wanted more revenue than they had initially offered. But as you’ll see, the spending cuts that we were prepared to engage in were at least as significant as the spending cuts that you’ve seen in a whole range of bipartisan proposals, and we had basically agreed within $10 billion, $20 billion — we were within that range.

So that wasn’t the reason this thing broke down. We were consistent in saying that it was going to be important for us to have at least enough revenue that we could protect current beneficiaries of Social Security, for example, or current beneficiaries of Medicare; that we weren’t slashing Medicaid so sharply that states suddenly were going to have to throw people off the health care rolls. And we were consistent in that.

So I want to be clear. I’m not suggesting that we had an agreement that was signed, sealed and delivered. The parties were still apart as recently as yesterday. But when you look at the overall package, there’s no changing of the goalposts here. There has been a consistency on our part in saying we’re willing to make the tough cuts and we’re willing to take on the heat for those difficult cuts, but that there’s got to be some balance in the process. What I’ve said publicly is the same thing that I’ve said privately. And I’ve done that consistently throughout this process.

Now, with respect to this breakdown in trust, I think that we have operated aboveboard consistently. There haven’t been any surprises. I think the challenge really has to do with the seeming inability, particularly in the House of Representatives, to arrive at any kind of position that compromises any of their ideological preferences. None.

And you’ve heard it. I mean, I’m not making this up. I think a number of members of that caucus have been very clear about that.

Q But they were willing to move on some revenues, apparently.

THE PRESIDENT: Absolutely. But what you saw — and, again, you’ll see this from the description of the deal — essentially what they had agreed to give on is to get back to a baseline — this starts getting technical, but there were about $800 billion in revenue that were going to be available. And what we said was when you’ve got a ratio of $4 in cuts for every $1 of revenue, that’s pretty hard to stomach. And we think it’s important to make sure that whatever additional revenue is in there covers the amount of money that’s being taken out of entitlement programs. That’s only fair.

If I’m saying to future recipients of Social Security or Medicare that you’re going to have to make some adjustments, it’s important that we’re also willing to make some adjustments when it comes to corporate jet owners, or oil and gas producers, or people who are making millions or billions of dollars.

Wendell. Where’s Wendell? Wendell is not here.

Lesley. Is Lesley here?

Q Yes, Mr. President.

THE PRESIDENT: There you are.

Q Thank you. You’ve said that your bottom line has been the big deal; that’s not going to happen. Are you going to be willing to go back to just raising the debt ceiling still?

THE PRESIDENT: Well, I think I’ve been consistently saying here in this press room and everywhere that it is very important for us to raise the debt ceiling. We don’t have an option on that. So if that’s the best that Congress can do, then I will sign a extension of the debt ceiling that takes us through 2013.

I don’t think that’s enough. I think we should do more. That’s the bare minimum; that’s the floor of what the American people expect us to do. So I’d like to see us do more. And when I meet with the leadership tomorrow I’m going to say let’s do more. But if they tell me that’s the best they can do, then I will sign an extension that goes to 2013, and I will make the case to the American people that we’ve got to continue going out there and solving this problem. It’s the right thing to do, and it’s time to do it. We can’t keep on putting it off.

Q You suggested that Speaker Boehner didn’t return phone calls this afternoon. Could you elaborate a little bit on that?

THE PRESIDENT: You know, I’m less concerned about me having to wait for my phone call returned than I am the message that I received when I actually got the phone call.

I’m going to make this the last question. Go ahead.

Q Yes, the markets are closed right now, obviously. What assurances can you give people on Wall Street? Are you going to be reaching out to some people on Wall Street so that when Monday comes we don’t see a reaction to the news that’s developing right now?

THE PRESIDENT: I think it’s very important that the leadership understands that Wall Street will be opening on Monday, and we better have some answers during the course of the next several days.

Q What can you say to people who are watching who work on Wall Street who might find this news a bit alarming, perhaps?

THE PRESIDENT: Well, I think what you should say — well, here’s what I’d say: I remain confident that we will get an extension of the debt limit and we will not default. I am confident of that.

I am less confident at this point that people are willing to step up to the plate and actually deal with the underlying problem of debt and deficits. That requires tough choices. That’s what we were sent here to do.

I mean, the debt ceiling, that’s a formality. Historically, this has not even been an issue. It’s an unpleasant vote but it’s been a routine vote that Congress does periodically. It was raised 18 times when Ronald Reagan was President. Ronald Reagan said default is not an option, that it would be hugely damaging to the prestige of the United States and we shouldn’t even consider it. So that’s the easy part. We should have done that six months ago.

The hard part is actually dealing with the underlying debt and deficits, and doing it in a way that’s fair. That’s all the American people are looking for — some fairness. I can’t tell you how many letters and emails I get, including from Republican voters, who say, look, we know that neither party is blameless when it comes to how this deft and deficit developed — there’s been a lot of blame to spread around — but we sure hope you don’t just balance the budget on the backs of seniors. We sure hope that we’re not slashing our commitment to make sure kids can go to college. We sure hope that we’re not suddenly throwing a bunch of poor kids off the Medicaid rolls so they can’t get basic preventative services that keep them out of the emergency room. That’s all they’re looking for, is some fairness.

Now, what you’re going to hear, I suspect, is, well, if you — if the Senate is prepared to pass the cap, cut and balance bill, the Republican plan, then somehow we can solve this problem — that’s serious debt reduction. It turns out, actually, that the plan that Speaker Boehner and I were talking about was comparable in terms of deficit reduction. The difference was that we didn’t put all the burden on the people who are least able to protect themselves, who don’t have lobbyists in this town, who don’t have lawyers working on the tax code for them — working stiffs out there, ordinary folks who are struggling every day. And they know they’re getting a raw deal, and they’re mad at everybody about it. They’re mad at Democrats and they’re mad at Republicans, because they know somehow, no matter how hard they work, they don’t seem to be able to keep up. And what they’re looking for is somebody who’s willing to look out for them. That’s all they’re looking for.

And for us not to be keeping those folks in mind every single day when we’re up here, for us to be more worried about what some funder says, or some talk radio show host says, or what some columnist says, or what pledge we signed back when we were trying to run, or worrying about having a primary fight — for us to be thinking in those terms instead of thinking about those folks is inexcusable.

I mean, the American people are just desperate for folks who are willing to put aside politics just for a minute and try to get some stuff done.

So when Norah asked or somebody else asked why was I willing to go along with a deal that wasn’t optimal from my perspective, it was because even if I didn’t think the deal was perfect, at least it would show that this place is serious, that we’re willing to take on our responsibilities even when it’s tough, that we’re willing to step up even when the folks who helped get us elected may disagree.

And at some point, I think if you want to be a leader, then you got to lead.

Thank you very much.

6:36 P.M. EDT

Mike Flavin: Former professor at Midwestern State University, dies


History Buzz

Former Midwestern State University professsor Michael Flavin, 69, died Thursday morning after a years-long battle with Alzheimer’s disease. Services are pending.

Flavin began his career at MSU in 1969 and prided himself on a balanced approach in the classroom; students could freely express their political views but, as he told a colleague, “they better be ready to back it up with facts.”

An acknowledged expert on the history of local, state and national politics and election lore, Flavin was often called on by the Times Record News and local television stations for political analysis; he never hesitated to predict the outcome of elections and referendums….READ MORE

Political Buzz Debt Ceiling Showdown, July 22, 2011: President Obama’s U of Maryland Town Hall — Boehner Speaks with the Press & the Senate Votes Down House’s Cut, Cap & Balance Act


By Bonnie K. Goodman

Ms. Goodman is the Editor of History Musings. She has a BA in History & Art History & a Masters in Library and Information Studies from McGill University, and has done graduate work in history at Concordia University.


Brendan Smialowski for The New York Times

Speaker John A. Boehner, center, said he was confident that House conservatives would bend.


“Frankly, we are not close to an agreement. I would just suggest it is going to be a hot weekend here in Washington, D.C.” — House Speaker John Boehner

“I have talked to my lawyers. They are not persuaded that that is a winning argument. So, the challenge for me is to make sure that we do not default, but to do so in a way that is as balanced as possible and gets us at least a down payment on solving this problem.” President Obama said in response to a question about the Constitutional argument at a townhall at the University of Maryland.

“We’re going to dispose of this legislation as it needs to be, so that President Obama and the speaker can move forward on a [plan] that will have some revenue in it.” — Senate Majority Leader Harry Reid (D-Nev.)

“It’s a great opportunity for him to talk to young people, to students, about how this is really a debate about the economy and jobs and the need to stabilize the foundation of the economy and creating jobs and lessening the economic anxiety out there, felt by students.” — White House Press Secretary Jay Carney said Thursday aboutr President Obama’s Town Hall at the University of Maryland

President Obama Discusses Debt Crisis at University of Maryland Town Hall – Transcript — WH, 7-22-11

  • Obama stresses need for more tax revenue; Senate rejects House debt plan: President Obama insisted Friday that any broad deficit-reduction plan must include new tax revenue in addition to large spending cuts, and the Senate rejected a bill from the Republican-controlled House that would have required a balanced budget amendment and massive cuts, but no tax hikes.
    Speaking at a town hall meeting at the University of Maryland in College Park, Obama told a largely supportive audience, “We can’t just close our deficit with spending cuts alone.” That would mean senior citizens would have to “pay a lot more for Medicare,” students would have trouble getting education loans, job training programs would be trimmed and there were be “devastating cuts” in medical and clean-energy research, he said.
    “If we only did it with cuts, if we did not get any revenue to help close this gap . . . then a lot of ordinary people would be hurt, and the country as a whole would be hurt,” Obama said. “And that doesn’t make any sense. It’s not fair. And that’s why I’ve said, if we’re going to reduce our deficit, then the wealthiest Americans and the biggest corporations should do their part as well.”
    “This idea of balance, this idea of shared sacrifice, of a deficit plan that includes tough spending cuts but also includes tax reform that raises more revenue, this isn’t just my position,” he said. “This isn’t just a Democratic position. This isn’t some wild-eyed socialist position.” Rather, it argued, it is a position taken in the past by presidents from both parties who have signed major deficit-reduction deals.
    “So we can pass a balanced plan like this,” Obama said. “The only people we have left to convince are some folks in the House of Representatives. We’re going to keep working on that.”… – WaPO, 7-22-11
  • Obama again presses GOP to move on taxes in debt deal: If President Obama is indeed pursuing a deal with House Speaker John Boehner that would lack an ironclad agreement to boost government receipts, he didn’t show his hand Friday.
    At a town-hall-style event at the University of Maryland, Obama again restated his long-standing position that any accord to raise the federal debt ceiling must combine spending cuts with revenue generators stemming from a rewrite of the tax code.
    “We can’t just close our deficit with spending cuts alone,” Obama said before a crowd in College Park, Md. “If we only do it with cuts … a lot of ordinary people would be hurt and the country as whole would be hurt.”… – LAT, 7-22-11
  • Senate Rejects House Budget Plan; Obama Calls for Deal: The Senate on Friday rejected a House plan to substantially cut government spending and raise the federal debt limit contingent on a balanced budget proposal, leaving Congress up in the air about how to resolve its impasse over the federal debt ceiling and avoid a government default.
    Senators voted 51 to 46 along party lines to set aside the measure, known as the “cut, cap and balance” bill, which was sent to the Senate by the House this week and seen by conservative House members as their preferred option for increasing the debt ceiling. For many House Republicans, the legislation was their best offer in the continuing standoff with President Obama and Congressional Democrats.
    After the vote, Senator Harry Reid, the Nevada Democrat and majority leader, said the Senate was for the moment abandoning its fallback plan and would not immediately move ahead with a procedural maneuver proposed by Senator Mitch McConnell of Kentucky to increase the debt limit. He said the Senate would instead await the results of negotiations between Mr. Obama and the House speaker, John A. Boehner of Ohio, over a broad deficit reduction package.
    “The path to avert default now runs through the House of Representatives,” Mr. Reid said after Democrats voted against the House plan. He said that he was canceling plans to keep the Senate in session over the weekend and that lawmakers would instead reconvene Monday, just more than a week before the Aug. 2 deadline set by the Treasury Department for increasing the $14.3 trillion limit.
    Mr. Obama said at a town hall meeting where he was taking questions Friday morning that he was willing to agree to “historic” spending cuts in an effort to trim the nation’s budget deficit, and urged Congressional factions to come together and reach a deal. He said it was not conceivable that the United States would default on its debt.
    “This is a rare opportunity for both parties to come together and choose a path where we stop putting so much debt on our credit card,” Mr. Obama said…. – NYT, 7-22-11
  • Senate votes down GOP debt ceiling plan: The Senate on Friday defeated the Republican “Cut, Cap and Balance” proposal, a move that puts the onus on President Obama and House Speaker John Boehner to present a plan soon to raise the debt ceiling or risk a potentially catastrophic default.
    The procedural vote to kill the measure that was approved by the Republican-controlled House on Tuesday was along party lines in the Democratic-controlled Senate.
    “We’re going to dispose of this legislation as it needs to be, so that President Obama and the speaker can move forward on a [plan] that will have some revenue in it,” Senate Majority Leader Harry Reid (D-Nev.) said just before the roll call began.
    Friday had been seen as a potentially critical date in the weeks-long budget debate. According to the Treasury Department, lawmakers must agree to a plan that raises the debt limit before Aug. 2 or the federal government could default on its obligations for the first time in the nation’s history…. – LAT, 7-22-11
  • John Boehner: Debt talks will make for a “hot weekend here in Washington”: “It’s going to be a hot weekend here in Washington, D.C.,” House Speaker John Boehner said today.
    Nevermind that the heat index for the District on Friday is 120 degrees — lawmakers will be sweating in their Washington offices as the clock ticks down toward a possible U.S. default.
    The Senate on Friday rejected a Republican plan that would have made raising the debt ceiling contingent on passing a balanced budget amendment. Democratic leaders blasted the plan as bad policy and hardly worthy of consideration. But Boehner said today it’s still the only plan to raise the debt ceiling that he supports.
    Calling himself a “happy warrior” on behalf of the GOP plan — dubbed “cut, cap and balance” — Boehner said, “The House has done its job.” The speaker refused to acknowledge the need for an alternative plan. “If [members of the Senate] don’t like our version of ‘cut, cap and balance’… then what’s their plan?” he asked. “They can make amendments and send it back over.”… – CBS News, 7-22-11
  • Boehner: ‘We are not close’ to reaching a debt deal with Obama: Speaker John Boehner (R-Ohio) on Friday assured House Republicans that he is not on the verge of striking a deal with the White House to raise the debt ceiling.
    “Frankly, we are not close to an agreement,” Boehner said. “I would just suggest it is going to be a hot weekend here in Washington, D.C.”
    Boehner told reporters there “never was an agreement” with the White House on a grand bargain.
    But he told the GOP conference that the House needs to be prepared to pass something related to the debt ceiling by next Wednesday, according to Rep. Peter King (R-N.Y.) Others in the meeting said Boehner was talking about fall-back options because it would be irresponsible not to.
    GOP members on Friday insisted the Senate should amend “Cut, Cap and Balance” and send an alternative back to the House. Boehner claimed two-thirds of the pubic supports the plan, which would cut at least $6 trillion in spending over a decade without revenue increases.
    “The House has done its job, and I hope the Senate will do theirs. And if they don’t our version of ‘Cut, Cap and Balance,’ guess what? That is what the legislative process if for. They can amend it, they can change it, they can send it back over to the House,” Boehner said…. – The Hill, 7-22-11
  • Democrats, divided (on the debt ceiling): For weeks, the dominant storyline in the ongoing (and ongoing and ongoing) debt limit negotiations has been the fissure between establishment Republicans and the tea party wing of the GOP.
    That all changed Thursday when reports began to surface that a deal that would include $3 trillion in spending cuts — including to entitlement programs — was being hashed out by the White House and House Republicans.
    Congressional Democrats — as expertly detailed by the Post’s Paul Kane — reacted angrily to the idea, insisting that such a deal would amount to declaring defeat (politically and otherwise) when victory was in sight.
    What the episode proves — for the billionth time in the history of politics — is that what’s good for the goose (Obama) is not always good for the gander (congressional Democrats).
    What Obama needs and wants out of this protracted debate about the country’s financial future is a deal…. – WaPo, 7-22-11
  • US Senate rejects House budget plan: The US Senate this morning rejected a House-backed budget and deficit plan, leaving Congress at a tense impasse over how to solve the nation’s looming debt limit problem before the US Treasury stops paying some of its bills on Aug. 2.
    The Senate, along a 51-to-46 party-line vote, used a procedural vote to dispatch with the House-passed “Cut, Cap and Balance” plan, which would cut current spending, cap future spending, and require a constitutional amendment to balance the federal budget.
    Senator Scott Brown, the Massachusetts Republican, supported moving forward with the measure. Senator John Kerry, the Massachusetts Democrat, was one of three senators who did not vote on it.
    His staff did not immediately respond to a request for comment, but he has railed against the House GOP plan previously.
    “ A balanced budget requirement is something we have in Massachusetts, and I think it would be good for the entire country at a time when we are $14.3 trillion dollars in debt and it is rising every day,” Brown said in a statement after the vote. “Now both parties need to come together on a plan that will allow us to avoid default, make substantial cuts in spending, which is reasonable and bipartisan and will have a chance of being signed into law.” “Let’s stop the negative politics and partisan bickering and get down to work,” he added. “Time is running short.”… – Boston Globe, 7-22-11
  • Debt Ceiling Uncertainty Puts States at Risk: The federal debt ceiling debate is already complicating life for state and local governments. States whose economies rely on the federal government — including Maryland and Virginia, home to many federal employees and contractors — are at the greatest risk if there is no agreement and Washington has to decide which payments to make and which to skip. They were among the states warned by Moody’s Investors Service this week that their credit ratings were being jeopardized by Washington — which would make it more expensive for them to borrow for costs like construction, through no fault of their own.
    Many state and local officials are still hoping that a deal will be reached, averting a situation in which federal payments to the states could start to be cut in August. But a number of states have begun preparing for the worst…. – NYT., 7-22-11
  • Obama to talk debt at U-Md. town hall: President Obama will host a town hall meeting at University of Maryland on Friday to make his case for why he is pushing Congress for a “grand bargain” solution, 12 days before the United States faces a potentially catastrophic financial default.
    Obama is set to appear at 11 a.m. at the 1,200-seat Ritchie Coliseum in College Park, in front of a mixed crowd of students, faculty and other locals. General admission seats were distributed within about 1 1 / 2 hours after the ticket booth opened, university spokesman Milree Williams said. A few dozen students camped out overnight.
    After weeks of intense negotiations with Congress, Obama will tell the audience that now is the time for a major deficit reduction package that includes a mix of spending cuts and tax increases…. – WaPo, 7-22-11
  • US debt talks begin critical phase: Efforts to avoid an unprecedented U.S. default enter crunch time on Friday, with President Barack Obama and top lawmakers engaged in a sometimes chaotic drive to strike a sweeping deficit-reduction deal.
    With the clock ticking toward an Aug. 2 deadline to raise the U.S. debt ceiling, Obama and the senior Republican in Congress, House Speaker John Boehner, worked toward a plan that could include up to $3 trillion in spending cuts but might leave tax reform for later, congressional aides said.
    The main obstacle remained the issue of tax increases that Obama’s Democrats demand and Republicans vehemently oppose. There were conflicting accounts of how and when higher revenue might kick in, and the White House vowed there would be no deal without this.
    Negotiations have whipsawed between competing and even conflicting options, and leaders on both sides face resistance within their own ranks to some ideas now gaining traction…. – Reuters, 7-22-11
  • Obama, Boehner Press for Broad Deficit Deal Amid Strife: President Barack Obama and House Speaker John Boehner, each facing strife within his own ranks and dwindling time to avert a U.S. default, pressed for a broad agreement to boost the debt limit while cutting spending by trillions of dollars and overhauling the tax code.
    Negotiators are “not close to an agreement,” the speaker told reporters after meeting with rank-and-file House Republicans today. “I would suggest it is going to be a hot weekend here in Washington.”
    Obama summoned top Democrats to the White House last night after Democrats balked at word of a potential deal between the president and Boehner that would reduce the long-term deficit by about $3 trillion over 10 years through deep spending cuts without an immediate increase in taxes. Democratic lawmakers said they feared the president was moving toward an agreement that undermined their party’s priorities…. – Bloomberg, 7-21-11

Senate Majority Leader Harry Reid speaks on the Senate floor Friday before a vote to kill the GOP's "Cut, Cap and Balance Act."

Senate Majority Leader Harry Reid speaks on the Senate floor Friday before a vote to kill the GOP’s “Cut, Cap and Balance Act.” (C-SPAN)

Josh Howard: North Carolina Civil War history might need a rewrite


History Buzz

Source: NC News & Observer, 7-22-11

Josh Howard’s work as a research historian at N.C. Archives and History debunks two cherished myths about the Civil War.

For more than a century, North Carolina clung to a pair of Civil War distinctions thought sacred: It sent the first Confederate killed in battle, and it sacrificed 40,275 men – the most in the South.

Only part of that may still be true.

On the 150th anniversary of the war’s first shots, a new state study pulls together the scattered, error-riddled records of North Carolina’s Civil War dead and shows the following:

A Virginia captain beat Pvt. Henry Lawson Wyatt, a 19-year-old from Tarboro, to the grave by nine days;

North Carolina’s casualty list is actually closer to 32,000, possibly 35,000 if you count those still missing from the records and lumped into the “probable” category. Whether that’s the highest is unclear;

The war killed about a quarter of the state’s men of military age. More died of typhoid fever and chronic diarrhea than bullets. Some even died of spider bites and lightning strikes.

The point of the study isn’t to debunk any points of pride, said Josh Howard, the study’s author and a historian with the state Office of Archives and History. He started the study six years ago assuming the 40,275 figure was accurate.

“It’s not that we’re trying to destroy them,” he said. “Every household in North Carolina lost somebody in the war, or at least knew somebody. We as North Carolinians owe it to them to get it right, to demonstrate the huge loss the state took.”

In all likelihood, North Carolina still ranks first in fallen Confederates. If records in Raleigh are wrong, it’s a good bet the rest of the Southern states have inaccurate counts, too. Second-place Virginia, also reviewing its count, is moving much closer to North Carolina in the number of dead.

Descendants and admirers of the dead aren’t upset about the findings.

“It’s always good to get it right,” said John Huss of Raleigh, a local camp officer with the Sons of Confederate Veterans. “But we still might be first.”

Praising the dead

Turning casualties into bragging rights may sound macabre by modern standards, but Howard’s study illustrates how Southern states used the measurement of their dead as a yardstick showing who gave the most to the cause. At the end of the war, with so many dead, North Carolina needed a symbol.

Wyatt became a powerful one. Howard’s study documents the portraits hung in the state library during the 1880s, and the collectible baseball-style cards that circulated with his likeness. Even today, his bronze statue appears on the Capitol lawn,rifle at the ready.

When Virginia protested that Capt. John Q. Marr had preceded Wyatt in death, North Carolinians disputed the claim by concluding that Marr had perished in a mere skirmish while Wyatt fell at the Battle of Big Bethel.

Similarly, the Capitol grounds monument to the Confederate dead facing Hillsborough Street boasts that North Carolinians were last to leave Appomattox.

“North Carolina has always been looking for ways to claim that it is unique and it is better,” said Larry Tise, history professor at East Carolina University, “that it is first in so many things.”

Howard’s study takes it further: High fatalities didn’t inflate the egos of Southern generals after the war; they boosted state pride.

“Sacrifice equated honor,” he wrote.

But in the days after the war, as the federal government tried to tally the dead, they worked with Confederate records captured from fleeing officials, many of which were lost. Few of those counting had much enthusiasm for the job at the war’s end, and the 40,000 became accepted truth ….READ MORE

Joe Walsh: Freshmen Republican ex-history professor holds key role in debt talks


History Buzz

‘These are people who are, deep down, anti- government’: professor

Before the 2010 U.S. midterm elections, Joe Walsh was a two-time political loser who almost no one – excluding maybe his family and close friends – thought would win a seat in Congress.

Now the 49-year-old former American history professor and investment banker is among a group of first-term House Republican lawmakers who, arguably, wield more power over America’s debt crisis than the president of the United States.

Swept into office last November on a wave of support from Tea Party conservatives, Walsh, who represents Illinois’ 8th district, is one of 87 GOP freshmen whose opposition to a compromise over raising America’s debt ceiling risks pushing the U.S. government into default.

Call them uncompromising, or call them principled, this much is undisputed about the Republican newcomers: Without their backing, the Republican-controlled House of Representatives will have extraordinary difficulty getting the necessary 218 votes to pass bipartisan debt legislation before the U.S. reaches its $14.3 trillion borrowing limit on Aug. 2…. READ MORE

Full Text Debt Ceiling Showdown, July 22, 2011: President Obama Discusses Debt Crisis at University of Maryland Town Hall



President Obama on deficit reduction

Remarks by the President at University of Maryland Town Hall

Source: WH, 7-22-11

Ritchie Coliseum University of Maryland College Park, Maryland

11:04 A.M. EDT

THE PRESIDENT:  Hello, Maryland!  (Applause.)  Hello!  Nice to see you.  Thank you so much.  (Applause.)  Everybody, please have a seat.  I see some smart folks up there wore shorts. (Laughter.)  My team said I should not wear shorts.  (Laughter.) My legs aren’t good enough to wear shorts.

AUDIENCE MEMBER:  (Inaudible.)  (Laughter.)

THE PRESIDENT:  Thank you.  I’ll tell Michelle you said so. (Laughter.)

It is wonderful to be back in Maryland.  (Applause.)  I hope everybody is keeping cool, staying hydrated.  It is great to be back here in College Park.

I have a few acknowledgments that I want to make, some special guests that we have.  First of all, one of the best governors in the country, Martin O’Malley is in the house.  (Applause.)  Where’s Martin?  He was here.  There he is over there.  (Applause.)  By the way, for those of you who have not heard him, outstanding singer and rock-and-roller.  So if you ever want to catch his band, it is top-notch.

Also, one of the best senators in the country, Ben Cardin is in the house.  (Applause.)  We’ve got College Park Mayor Andrew Fellows is here.  (Applause.)  Former congressman, Frank Kratovil, is here.  (Applause.) You wouldn’t know it looking at him, but Frank is an outstanding basketball player.  (Laughter.) The Terps might be able to use him even at this age.  (Laughter.)  He is a point guard, got all kinds of moves.  (Laughter.)

And I want to thank your still quasi-new president here at Maryland, Wallace Lob, for the outstanding work that he’s doing. (Applause.)

So this is a town hall.  I want to spend some time answering some of your questions, but just want to say a few things at the top.  First of all, I have to say it’s nice to get out of Washington.  (Laughter.)  Don’t get me wrong — there’s nothing I enjoy more than sitting, hour after hour, day after day — (laughter) — debating the fine points of the federal budget with members of Congress.  (Laughter.)  But after a while you just start feeling a little cooped up.  So I’m happy to be spending my morning with you.

I’m going to spend most of my time answering your questions, but let me say a few words about the debate that’s taking place right now in Washington about debt and deficits.  Obviously, it’s dominating the news.  Even though it’s taking place in Washington, this is actually a debate about you and everybody else in America and the choices that we face.

And most people here, whether you’re still a student or you’re a graduate or you’re a parent, your number one concern is the economy.  That’s my number one concern.  It’s the first thing I think about when I wake up in the morning.  It’s the last thing I think about when I go to bed at night.  And I won’t be satisfied until every American who wants a job can find one, and until workers are getting paychecks that actually pay the bills, until families don’t have to choose between buying groceries and buying medicine, between sending their kids to college and being able to retire in some dignity and some respect.  (Applause.)

So we have gone through a very difficult two and a half years — the worst financial crisis and the worst recession we’ve seen since the Great Depression.  And although some progress has been made, there’s no doubt that this economy has not recovered as fast as it needs to.  And the truth is, it’s going to take more time because a lot of the problems that we’re facing right now — slow job growth, stagnant wages — those were there even before the recession hit.

For a decade, the average income, the average income of the American worker had flat-lined.  Those at the very top saw their incomes going up 50 percent, 100 percent.  But those in the middle, the vast majority of Americans, they had been struggling to keep up before the recession hit.

And so these challenges weren’t caused overnight; they’re not going to be solved overnight.  But as John F. Kennedy once said, “Our problems are manmade, therefore they can be solved by man.”

In the United States, we control our own destiny.  The question we have to answer, though, is:  Where do we want to go? What’s our vision for the future, and how do we get there?  Now, in the short term, I’ve been urging Congress to pass some proposals that would give the economy an immediate boost.  And these are proposals, by the way, that traditionally have had support in both parties.

I want to extend the tax relief that we put in place back in December for middle-class families, so that you have more money in your paychecks next year.  If you’ve got more money in your paychecks next year, you’re more likely to spend it, and that means small businesses and medium-sized businesses and large businesses will have more customers.  And they’ll be in a position to hire.

I want to give more opportunities to all those construction workers out there who lost their jobs when the housing bubble went bust.  We can put them to work, giving loans to private companies that want to repair our roads and our bridges and our airports — rebuilding our infrastructure, putting Americans to work doing the work that needs to be done.  We have workers in need of a job and a country that’s in need of rebuilding, and if we put those two things together we can make real progress.

I want to cut red tape that stops too many inventors and entrepreneurs from turning new ideas into thriving businesses.  I want Congress to send me a set of trade deals that would allow our businesses to sell more products in countries in Asia and South America that are stamped with the words, “Made in America.”
So these are some things that we could be doing right now.  There are proposals in Congress, as we speak, and Congress needs to act now.  But I also believe that over the long term, the strength of our economy is going to depend on how we deal with the accumulated debt and deficits that have built up over the last decade.  And that’s what the discussion in Washington is about right now.

Now, I know it’s hard to keep up with the different plans and the press conferences and the back-and-forth between the parties, but here’s what it all boils down to — it’s not that complicated.  For a decade, we have been spending more money than we take in.  Last time the budget was balanced was under a Democratic President, Bill Clinton.  (Applause.)  And a series of decisions were made — whether it was cutting taxes, or engaging in two wars, or a prescription drug benefit for seniors — that weren’t paid for, and then a financial crisis on top of that, Recovery Act to try to pull us out of a Great Depression — all those things contributed to this accumulated debt.

And regardless of what you feel about the particular policies — some of you may have supported the wars or opposed the wars; some of you may have agreed with the Recovery Act; some of you may be opposed — regardless of your views on these various actions that were taken, the fact is they all cost money. And the result is that there’s simply too much debt on America’s credit card.

Neither party is blameless for the decisions that led to this problem, but both parties have a responsibility to solve it. (Applause.)  If we don’t solve it, every American will suffer.  Businesses will be less likely to invest and hire in America.  Interest rates will rise for people who need money to buy a home or a car, or go to college.  We won’t have enough money to invest in things like education and clean energy, or protect important programs like Medicare, because we’ll be paying more and more interest on this national debt and that money just flows overseas instead of being spent here on the things that we need.

Now, the one thing we can’t do — cannot do — is decide that we are not going to pay the bills the previous congresses have already racked up.  So that’s what this whole issue of raising the debt ceiling is all about.  Basically, there’s some people out there who argue we’re not going to raise the debt ceiling any more.  And the problem is, effectively what that’s saying is we’re not going to pay some of our bills.  Well, the United States of America does not run out without paying the tab. We pay our bills.  (Applause.)  We meet our obligations.  (Applause.)  We have never defaulted on our debt.  We’re not going to do it now.

But even if we raise the debt ceiling, this debate shouldn’t just be about avoiding some kind of crisis, particularly a crisis manufactured in Washington.  This is a rare opportunity for both parties to come together and choose a path where we stop putting so much debt on our credit card.  We start paying it down a little bit.  And that’s what we’ve been trying to do.

So, for my part, I’ve already said that I’m willing to cut a historic amount of government spending in order to reduce the deficit.  I’m willing to cut spending on domestic programs, taking them to the lowest level since Dwight Eisenhower.  I’m willing to cut defense spending at the Pentagon by hundreds of billions of dollars.  (Applause.)  I’m willing to take on the rising costs of health care programs like Medicare and Medicaid, so that these programs will be there for the next generation, for folks — for a population generally that’s getting older and living longer.  We’ve got to make sure that these programs, which are the crown jewels of our social safety net, that — sort of mixed metaphors there — (laughter) — that those are there for the future.

And some of these cuts would just eliminate wasteful spending — weapons we don’t need, fraud and abuse in our health care system.  But I want to be honest.  I’ve agreed to also target some programs that I actually think are worthwhile.  They’re cuts that some people in my own party aren’t too happy about.  And, frankly, I wouldn’t make them if money wasn’t so tight.  But it’s just like a family.  If you’ve got to tighten your belts, you make some choices.

Now, here’s the thing, though — and this is what the argument is about — we can’t just close our deficit with spending cuts alone, because if we take that route it means that seniors would have to pay a lot more for Medicare, or students would have to pay a lot more for student loans.  It means that laid-off workers might not be able to count on temporary assistance or training to help them get a new job.  It means we’d have to make devastating cuts in education and medical research and clean energy research — just at a time when gas prices are killing people at the pump.

So if we only did it with cuts, if we did not get any revenue to help close this gap between how much money is coming in and how much money is going out, then a lot of ordinary people would be hurt and the country as a whole would be hurt.  And that doesn’t make any sense.  It’s not fair.

And it’s why I’ve said if we’re going to reduce our deficit, then the wealthiest Americans and the biggest corporations should do their part as well.  (Applause.)  Before we stop funding clean energy research, let’s ask oil companies and corporate jet owners to give up the tax breaks that other companies don’t get.  I mean, these are special tax breaks.  (Applause.)  Before we ask college students to pay more for their education, let’s ask hedge fund managers to stop paying taxes that are lower on their rates than their secretaries.  (Applause.)  Before we ask seniors to pay more for Medicare, let’s ask people like me to give up tax breaks that we don’t need and we weren’t even asking for.  (Applause.)

Look, I want everybody in America to do well.  I want everybody to have a chance to become a millionaire.  I think the free market system is the greatest wealth generator we’ve ever known.  This isn’t about punishing wealth.  This is about asking people who have benefited most over the last decade to share in the sacrifice.  (Applause.)  I think these patriotic Americans are willing to pitch in — if they’re asked — because they know that middle-class families shouldn’t have to pick up the whole tab for closing the deficit.

So this idea of balance, this idea of shared sacrifice, of a deficit plan that includes tough spending cuts but also includes tax reform that raises more revenue — this isn’t just my position.  This isn’t just the Democratic position.  This isn’t some wild-eyed socialist position.  (Laughter.)  This is a position that’s being taken by people of both parties and no party.  It’s a position taken by Warren Buffet — somebody who knows about business and knows a little something about being wealthy.  (Laughter.)  It’s a position that’s been taken by every Democratic and Republican President who’ve signed major deficit deals in the past, from Ronald Reagan to Bill Clinton.  And I was pleased to see this week that it’s a position taken by Democrats and Republicans in the Senate.

So we can pass a balanced plan like this.  It’s not going to make everybody happy.  In fact, it will make everybody somewhat unhappy.  The easiest thing for a politician to do is to give you more stuff and ask less in return.  It’s a lot harder to say, we got to cut back on what you’re getting and you got to pay a little more.  That’s never fun.  But we can do it in a balanced way that doesn’t hurt anybody badly, that doesn’t put the burden just on one group.

So we can solve our deficit problem.  And I’m willing to sign a plan that includes tough choices I would not normally make, and there are a lot of Democrats and Republicans in Congress who I believe are willing to do the same thing.  The only people we have left to convince are some folks in the House of Representatives.  We’re going to keep working on that.  (Laughter.)  Because I still believe we can do what you sent us here to do.

In 2010, Americans chose a divided government, but they didn’t choose a dysfunctional government.  (Applause.)  So there will be time for political campaigning, but right now this debate shouldn’t be about putting on — scoring political points.  It should be about doing what’s right for the country, for everybody.  You expect us to work together.  You expect us to compromise.  You’ve all been working hard.  You’ve been doing whatever you have to do in order to get by and raise your families.  You’re meeting your responsibilities.  So it’s time for those of us in Washington to do the same thing.  And I intend to make that happen in the coming days.  (Applause.)

So thank you, everybody.  (Applause.)  Let me take some  questions.

All right, so the way this works is you put up your hand and I call on you.  (Laughter.)  But I am going to go girl-boy-girl-boy to make sure that it’s even and fair.  All right?  So I’m going to start with you right there.

Yes.  Hold on, we got a mic here.  And introduce yourself if you don’t mind.

Q    Hello, Mr. President.


Q    My name is Amanda — and I’m a big fan.  I’m from Iowa, originally.


Q    Yes.  (Laughter.)  I’m an atheist.  And in Zanesville, Ohio, in 2008, you asserted that no organization receiving taxpayer funds would be able to discriminate in hiring or firing based on a person’s religion.  However, you have not rescinded the executive order that permits this type of discrimination.  In a time of economic hardship, when it is difficult for a person to get a job based on her skills, what would you say to a woman who has been denied employment because of her religion or lack of religious beliefs by a taxpayer-funded organization?

THE PRESIDENT:  Well, this is a very difficult issue, but a more narrow one than I think might be implied.  It’s very straightforward that people shouldn’t be discriminated against for race, gender, sexual orientation, and — or religious affiliation.

What has happened is, is that there has been a carve-out, dating back to President Clinton’s presidency, for religious organizations in their hiring for particular purposes.  And this is always a tricky part of the First Amendment.  On the one hand, the First Amendment ensures that there’s freedom of religion.  On the other hand, we want to make sure that religious bodies are abiding by general laws.

And so where this issue has come up is in fairly narrow circumstances where, for example, you’ve got a faith-based organization that’s providing certain services; they consider part of their mission to be promoting their religious views, but they may have a daycare center associated with the organization, or they may be running a food pantry, and so then the question is, does a Jewish organization have to hire a non-Jewish person as part of that organization?

Now, I think that the balance we’ve tried to strike is to say that if you are offering — if you have set up a nonprofit that is disassociated from your core religious functions and is out there in the public doing all kinds of work, then you have to abide generally with the non-discrimination hiring practices.  If, on the other hand, it is closer to your core functions as a synagogue or a mosque or a church, then there may be more leeway for you to hire somebody who is a believer of that particular religious faith.

It doesn’t satisfy everybody.  I will tell you that a lot of faith-based organizations think that we are too restrictive in how we define those issues.  There are others like you, obviously, who think that we’re not restrictive enough.  I think we’ve struck the right balance so far.  But this is something that we continue to be in dialogue with faith-based organizations about to try to make sure that their hiring practices are as open and as inclusive as possible.

Okay?  Thank you.

Yes, sir.  Back here.  Hold on a second, we got a mic.

Q    Yes.  Most of the American people are on your side about a balanced approach —


Q    What we also know is most of the budget cuts are going to be in the out-years.  So the question is why push so hard for a big settlement now, when if you push hard and let the American people vote in 2012 and get rid of these hooligans in the House, we might actually have a reasonable settlement — (applause) — maybe more like a one-to-one relationship instead of three to one or worse?

THE PRESIDENT:  The challenge I have in these negotiations is, whether I like it or not, I’ve got to get the debt ceiling limit raised.

Q    — the 14th Amendment?

THE PRESIDENT:  Well, I’ll answer that question later.  But I just want to make sure that everybody understands defaulting is not an option.

There are some on either side that have suggested that somehow we could manage our way through.  But I just want everybody to be clear, the United States government sends out about 70 million checks every month.  We have to refinance bonds that we’ve issued, essentially IOUs to investors.  We do that every week.  If suddenly investors — and by the way, a lot of those investors are Americans who have Treasury bills, pension funds, et cetera — if suddenly they started thinking that we might not pay them back on time, at the very least, at the bare minimum, they would charge a much higher interest rate to allow the United States to borrow money.

And if interest rate costs go up for the United States, they’re probably going to go up for everybody.  So it would be a indirect tax on every single one of you.  Your credit card interest rates would go up.  Your mortgage interest would go up. Your student loan interest would potentially go up.  And, ironically, the costs of servicing our deficit would go up, which means it would actually potentially be worse for our deficit if we had default.  It could also plunge us back into the kind of recession that we had back in 2008 and ’09.  So it is not an option for us to default.

My challenge, then, is I’ve got to get something passed.  I’ve got to get 218 votes in the House of Representatives.

Now, the gentleman asked about the 14th Amendment.  There is — there’s a provision in our Constitution that speaks to making sure that the United States meets its obligations.  And there have been some suggestions that a President could use that language to basically ignore this debt ceiling rule, which is a statutory rule.  It’s not a constitutional rule.  I have talked to my lawyers.  They do not — they are not persuaded that that is a winning argument.  So the challenge for me is to make sure that we do not default, but to do so in a way that is as balanced as possible and gets us at least a down payment on solving this problem.

Now, we’re not going to solve the entire debt and deficit in the next 10 days.  So there’s still going to be more work to do after this.  And what we’re doing is to try to make sure that any deal that we strike protects our core commitments to Medicare and Medicaid recipients, to senior citizens, to veterans.  We want to make sure that student loans remain affordable.  We want to make sure that poor kids can still get a checkup, that food stamps are still available for folks who are desperately in need.  We want to make sure that unemployment insurance continues for those who are out there looking for work.

So there are going to be a certain set of equities that we’re not willing to sacrifice.  And I’ve said we have to have revenue as part of the package.

But I’m sympathetic to your view that this would be easier if I could do this entirely on my own.  (Laughter.)  It would mean all these conversations I’ve had over the last three weeks I could have been spending time with Malia and Sasha instead.  But that’s not how our democracy works.  And as I said, Americans made a decision about divided government.  I’m going to be making the case as to why I think we’ve got a better vision for the country.  In the meantime, we’ve got a responsibility to do our job.

But it was an excellent question.  Thank you.  (Applause.)

All right.  Young lady right here, right in the front.  Hold on, let’s get you a mic so we can hear you.  Stand up.  What’s your name?

Q    My name is Kasa (phonetic.)  I have two questions.  One is, is there anything — like, obviously you’ve had a successful presidency, but is there anything —

THE PRESIDENT:  Well, there’s not obvious to everyone.  (Laughter and applause.)  But I appreciate you thinking it’s obvious.

Q    I think it’s successful, that’s all that matters.  But is there anything you regret or would have done differently?  And my second question is, can I shake your hand?  (Laughter.)

THE PRESIDENT:  Yes, I’ll come and shake your hand, I promise.  I will.  (Laughter.)  Do I have any major regrets?  You know, when I think — and I think about this all the time.  I mean, I’m constantly re-running in my head did we make the right move here, could we have done more there.  I think, overall, in an extremely difficult situation, we’ve made good choices; we’ve made good decisions.  (Applause.)

But we’ve been constrained, even when we had a Democratic Congress, because the way the Senate works these days is you’ve got to get essentially 60 votes in order to get anything through the Senate.  Frank remembers this because we got a lot of good stuff out of the House that never survived in the Senate.  So because of what’s — the rules of the filibuster in the Senate, it meant that, on economic policy, I might have done some things more aggressively if I could have convinced more Republicans in the Senate to go along.

I do think that in the first year, right after we found out that 4 million people had lost their jobs before I was sworn in, I think that I could have told the American people more clearly how tough this was going to be, how deep and long-lasting this recession was going to be.

That’s always a balance for a President.  On the one hand, you want to project confidence and optimism.  And remember, in that first year, people weren’t sure whether the banking system was going to melt down, and whether we were going to go into a Great Depression.  And so it was important for me to let the American people know we’re going to be all right; we’re going to be able to get through this.

On the other hand, I think maybe people’s expectations were that somehow we were going to be able to solve this in a year.  And we knew pretty soon after I took office that this was going to last for a while — because, historically, when you have recessions that arise out of financial crises, they last a lot longer than the usual business cycle recessions.

Beyond that, I also think that over the first two years I was so focused on policy and getting the policy right, that sometimes I forgot part of my job is explaining to the American people why we’re doing this policy and where we’re going.  And so I think a lot of people started trying to figure out, well, how do all these pieces fit together.  The auto industry has been saved, and that was a good thing.  Well, that saved a million jobs, but people weren’t sure how did that relate to our housing strategy, or how did that relate to health care.  And so I think that was something that I could have done better.

That’s just two items on what I’m sure are a very long list — (laughter) — of things that I could do better.  But having said that, the basic thrust of my first two-and-a-half years have been entirely consistent with what I said I was going to do during the campaign — because what I promised was that not only were we going to deal with the immediate crisis, I said we are going to start laying the foundation for us to solve some of these long-term problems.

So when we changed, for example, the student loan program to take billions of dollars that were going to the banks, as middlemen in the student loan program, and redirected them so that students — millions more students would benefit from things like Pell grants, that was in pursuit of this larger goal that we have to once again be the nation that has the highest percentage of college graduates and that we have the best-skilled workforce, because that’s what it’s going to take to win the future.

When we initiated health care reform, it was based on a long-term assessment that if we don’t get control of our health care costs and stop sending people to the emergency room for very expensive care, but instead make sure they’ve got adequate coverage so that they are getting regular checkups and they are avoiding preventable diseases like diabetes — that unless we do that, we’re going to go broke just on health care spending.

When we made the biggest investment in clean energy in our history over the last two-and-a-half years, it’s because of my belief that we have to free ourselves from the lock-grip that oil has on our economic well-being and our security.

And so I’m going to keep on pushing for those things that position us to be the most competitive, the most productive nation on Earth in the 21st century.  And I think on that front we have been very successful.  (Applause.)

All right.  Let me see.  This gentleman right here in the blue shirt.

Q    Mr. President, good to meet you.  My name is Steve.  I’m a doctoral student here.

THE PRESIDENT:  What are you studying?

Q    Political rhetoric.

THE PRESIDENT:  Uh-oh.  (Laughter.)  How am I doing so far?
Q    Pretty good.  Pretty good.

THE PRESIDENT:  I feel like I’m getting graded up there.  (Laughter.)  Go ahead.

Q    All right.  Much sacrifice is being asked of our generation.  So when are our economic perspectives going to be addressed?  For example, when is the war on drugs and society going to be abandoned and replaced by a more sophisticated and cost-effective program of rehabilitation such as the one in Portugal?  (Applause.)

THE PRESIDENT:  I have stated repeatedly, and it’s actually reflected in our most recent statement by our Office of Drug Policy, that we need to have an approach that emphasizes prevention, treatment, a public health model for reducing drug use in our country.  We’ve got to put more resources into that.  We can’t simply focus on interdiction because, frankly, no matter how good of a job we’re doing, when it comes to an interdiction approach, if there is high demand in this country for drugs, we are going to continue to see not only drug use but also the violence associated with the drug trade.

This has obviously become extremely severe for Mexico, and we are working now with the Mexican government, in part to help them deal with these transnational drug dealers, but one of the things that I’ve said to President Calderón is we understand that we have an obligation here in this country to reduce demand and the only way that you reduce demand is through treatment and prevention.

And there are a lot of communities around the country where if you are — if you have a serious drug problem and you decide, I’m going to kick the habit, and you seek out treatment — assuming you’re not wealthy, because it may not be covered even if you have health insurance — but particularly if you’re poor, you may have a 90-day wait before you can even get into a program.  Well, obviously if you’re trying to kick a habit, waiting 90 days to get help is a problem.

So I agree with you that we have to make sure that our balance in our approach is also focused on treatment, prevention. And part of our challenge is also getting into schools early and making sure that young people recognize the perils of drug use.

Now, am I — just to make sure that I’m actually answering your question, am I willing to pursue a decriminalization strategy as an approach?  No.  But I am willing to make sure that we’re putting more resources on the treatment and prevention side.  (Applause.)

Okay?  All right — right here, right in the front.

Q    Hi.  My name is Mary Wagner.  I teach government at Blake High School in Montgomery County.


Q    And one of the things that we teach our students when we’re teaching them about this governmental system that we have is how important it is in a two-party system to compromise.  And my students watched the Republican leadership after the last election saying things out loud like, we’re not going to compromise with the Democrats.  And does that mean — are things changing?  Do we not use compromise anymore?  And what should I teach my students about how our government works if people are saying out loud, we’re not going to compromise with the other party?  (Applause.)

THE PRESIDENT:  I think you should keep on teaching your students to compromise, because that’s not just how government works; that’s how life works.  How many people here are married? (Laughter.)  For those of you who are not but intend to get married, let me just tell you — (laughter) — you better get used to compromise.

All of us have particular views, a particular vision, in terms of where we think things should go.  But we live in societies, we live in communities.  And that means we never get our way a hundred percent of the time.  That’s what we teach our kids.  That’s what we teach our students.  That’s how government has to work.

And there’s this notion — I was actually reading an article on the way over here, and the basic notion was that, well, Obama is responsible, but he doesn’t fight enough for how he believes, and the Republicans are irresponsible but all full of conviction. So this was sort of the way the article was posed.  And this notion that somehow if you’re responsible and you compromise, that somehow you’re giving up your convictions — that’s absolutely not true.  (Applause.)

I think it’s fair to say that Abraham Lincoln had convictions.  But he constantly was making concessions and compromises.  I’ve got the Emancipation Proclamation hanging up in the Oval Office, and if you read that document — for those of you who have not read it — it doesn’t emancipate everybody.  It actually declares the slaves who are in areas that have rebelled against the Union are free but it carves out various provinces, various parts of various states, that are still in the Union, you can keep your slaves.

Now, think about that.  That’s — “the great emancipator” was making a compromise in the Emancipation Proclamation because he thought it was necessary in terms of advancing the goals of preserving the Union and winning the war.  And then, ultimately, after the war was completed, you then had the 13th and 14th and 15th amendments.

So, you know what, if Abraham Lincoln could make some compromises as part of governance, then surely we can make some compromises when it comes to handling our budget.  (Applause.)

But you’re absolutely right that the culture is now pushing against compromise, and here are a couple of reasons.  I mean, one reason is the nature of congressional districts.  They’ve gotten drawn in such a way where some of these districts are so solidly Republican or so solidly Democrat, that a lot of Republicans in the House of Representatives, they’re not worried about losing to a Democrat, they’re worried about somebody on the right running against them because they compromise.  So even if their instinct is to compromise, their instinct of self-preservation is stronger, and they say to themselves, I don’t want a primary challenge.  So that leads them to dig in.

You’ve got a media that has become much more splintered.  So those of you who are of a Democratic persuasion are only reading The New York Times and watching MSNBC — (laughter) — and if you are on the right, then you’re only reading the Wall Street Journal editorial page and watching FOX News.  (Laughter.)  And if that’s where you get your information, just from one side, if you never even have to hear another argument, then over time you start getting more dug in into your positions.

They’ve actually done studies — this is interesting — that if you put people in a room who agree with each other basically  — if you just put a group of very liberal folks together and they’re only talking to each other for long periods of time, then they start becoming — they kind of gin each other up and they become more and more and more liberal.  And the same thing happens on the conservative side; they become more and more and more conservative.  And pretty soon you’ve got what you have now, which is everybody is demonizing the other side; everybody considers the other side completely extremist, completely unscrupulous, completely untrustworthy.  Well, in that kind of atmosphere it’s pretty hard to compromise.

So we have to wind back from that kind of political culture. But the only way we do it is if the American people insist on a different approach and say to their elected officials, we expect you to act reasonably, and we don’t expect you to get your way a hundred percent of the time, and we expect you to have strong convictions, but we also expect you to manage the business of the people.  And if you’re sending that message, eventually Congress will get it.  But it may take some time.  You’ve got to stay on them.

All right?  Gentleman back there, right there.  You got a microphone.  Oh, I’m sorry, I was pointing to this gentleman right there.  Yes.

Q    Mr. President, good morning to you.

THE PRESIDENT:  Good morning.

Q    I have cerebral palsy, as does my brother.  And I come to you to implore you to do as much as you can to protect services and supports for people with disabilities in your negotiations with Speaker Boehner and Leader Cantor.  I know that’s hard because Mr. McConnell has said he wants to make you a one-term President.  But the issue is we need the vital therapies that Medicaid provides.  We need a generous IDEA budget so people like me with severe disabilities can graduate from high school with a diploma and go to college.  So please don’t leave us holding the bag.  I know that a lot of people at Easter Seals are very worried, but given your experience with your father-in-law, I know you’ll do the right thing, sir.  It’s an honor to speak with you.  (Applause.)

THE PRESIDENT:  Thank you.  Thanks.  Thank you.  Thank you. That’s a wonderful comment.  And the reference to my father-in-law, he actually had muscular dystrophy but ended up being pretty severely handicapped by the time he was 30, 35, but still went to work every single day, never missed a day of work, never missed a ballgame of Michelle’s brother, never missed a dance recital of Michelle’s, raised an incredible family, took care of all his responsibilities, didn’t leave a lot of debt to his kids.  An extraordinary man.

And you’re exactly right that the enormous potential that so many people have, if they just get a little bit of help, that has to be factored in when we’re making decisions about our budget, because if we’re not providing services to persons with disabilities and they are not able to fulfill their potential — graduate from high school, go to college, get a job — then they will be more reliant on government over the long term because they’ll be less self-sufficient.  That doesn’t make any sense.

So we’ve always got to factor in, are we being penny wise and pound foolish?  If we cut services for young people — let’s say a lot of states are having to make some tough budget decisions — I know Martin has had to make some tough ones here. But I know one of the things that Martin has tried to do is to preserve as much as possible Maryland’s commitment to education, because he knows, look, I may save some money — (applause) — he knows, short term I may save some money if I lay off a whole bunch of teachers and classroom sizes get larger and we’re giving less supplemental help to kids in need.  But over the long term, it’s more likely, then, that those kids end up dropping out of school, not working, not paying taxes, not starting businesses, maybe going to prison.  And that’s going to be a huge drag on the state’s capacity to grow and prosper.

So we’ve always go to think about how do we trim back on what we need now, but keep our eyes on what are our investments in the future.  And this is what you do in your own family.  Think about it.  Let’s say that something happens, somebody in your family loses a job; you’ve got less income coming in.  You’re probably going to cut back on eating out.  You’re probably going to cut back on the kind of vacations you take, if any.  But you’re not going to cut out the college fund for your kid.  You’re not going to cut out fixing the roof if it’s leaking, because you know that if I don’t fix the roof, I’m going to get water damage in my house and that’s going to cost me more money.
Well, the same thing is true here in America when it comes to infrastructure, for example.  We’ve got all these broken down roads and bridges, and our ports and airports are in terrible shape.

I was talking to the CEO of Southwest Airlines and we’ve been doing a lot of work on the need for a next-generation air control system.  And he said to me — think about this — that if we fixed, updated an air control system that was basically put in place back in the ‘30s, if we upgraded that to use GPS and all the new technologies, the average airline would save 15 percent in fuel — 15 percent — which some of that you’d get in terms of lower airfare.  That’s 15 percent less carbon going into the atmosphere, for those of you who are concerned about climate change.  So why wouldn’t we do that?  Now, it cost some money to do it initially, but if we make the investment it will pay off.

All right, how much time do I have, Reggie?  I got time for one more question?  Okay.  Well, this one — all right, well, she is standing and waving.  (Laughter.)

Q    Hi, my name is Darla Bunting.  I’m a third grade literacy teacher in Southeast D.C.  (Applause.)  And I view gentrification as a Catch 22, because, on one hand, you’re bringing major businesses to underdeveloped areas in different cities, but on the other hand, the very people who live in the neighborhoods, it kind of seems as though they’re not reaping the benefits.  And I wanted to know how can we create sustainable neighborhoods that allow people who are still trying to achieve the American Dream to be able to afford and live in these brand new neighborhoods and communities?

THE PRESIDENT:  Well, first of all, I have to say that gentrification has been a problem in some communities.  But right now, frankly, that would probably be a problem that a lot of communities would welcome if there was a lot of investment going on.  We’re probably seeing in a lot of cities around the country the reverse problem, which is no investment, people not building new homes, young people not moving back into some of these communities and it’s emptying out.  So as problems go for cities, this is probably not a bad problem to have because it means the city is growing and attracting new businesses and new energy.

I think that this is typically an issue for local communities to make determinations about how do you get the right balance.  If, in fact, certain areas of a city are growing, how do you make sure that it still has housing for longtime residents who may not be able to afford huge appreciation in property values?  How do you make sure that the businesses that have been there before are still able to prosper as an economy changes?

What we have done is try to refocus how the federal government assists cities.  The federal government provides help to cities through the Department of Transportation, though the Department of Housing and Urban Development.  Obviously, Health and Human Services does a lot of stuff to manage services for low-income persons.  But sometimes the whole is less than the sum of its parts.  Sometimes there’s not enough coordination between various federal agencies when they go into a particular community.

So one of the things that we’ve been trying as part of a new approach to urban revitalization is sending one federal team to a particular city to gather all the federal agencies together and say, what’s working with the city; what’s the plan for this city, and how do we get all these pieces to fit together?  And so in a situation like you described, we might say how do we continue to foster growth but can we help some of those small businesses who feel like they’re getting pushed out so that they can stay and they can upgrade, and they can take advantage of these new opportunities.  And so far, we’re seeing some success in this new approach.

But, as I said, for a lot of cities right now, the big problem is not gentrification.  The big problem is property values have plummeted — you got a bunch of boarded-up buildings, a bunch of boarded-up stores.  And the question is how do you get economic activity going back in those communities again.

Even though I — Reggie said one more question, I’m actually going to call on Tom McMillen, just because he’s a friend of mine and he had his hand up earlier.  (Applause.)  And he was a pretty good ballplayer.  I mean, I’m not sure he was as good as Frank, but I hear he was pretty good.  (Laughter.)

Q    Well, thank you, Mr. President, for coming out to the University of Maryland.  You have an open invitation to Comcast Arena.  And Frank and I and a couple of us will be glad to set up a pick-up game if you want to —

THE PRESIDENT:  There you go.  (Laughter.)  There you go.

Q    But my serious question is the following:  You know, we’re focused so much on this debt right now and the debt limit, but this country could be sliding into another slowdown.  And how do we avoid what happened to President Roosevelt in the ’30s? Because we ought to be focusing on getting this economy going again.  (Applause.)

THE PRESIDENT:  Good.  For those of you who’ve studied economic history and the history of the Great Depression, what Tom is referring to is, Roosevelt comes in — FDR comes in, he tries all these things with the New Deal; but FDR, contrary to myth, was pretty fiscally conservative.  And so after the initial efforts of the New Deal and it looked like the economy was growing again, FDR then presented a very severe austerity budget. And suddenly, in 1937, the economy started going down again.  And, ultimately, what really pulled America out of the Great Depression was World War II.

And so some have said, I think rightly, that we’ve got to be careful that any efforts we have to reduce the deficit don’t hamper economic recovery, because the worst thing we can do for the deficit is continue to have really bad growth or another recession.

So what I’ve tried to emphasize in this balanced package that we’ve talked about is how do we make a serious down payment and commitment to deficit reduction but, as much as possible, focus on those structural long-term costs that gradually start coming down, as opposed to trying to lop off everything in the first year or two, and how do we make sure that as part of this package we include some things that would be good for economic growth right now.

So back in December we passed a payroll tax cut that has saved the typical family $1,000 this year.  That’s set to expire at the end of this year.  And what I’ve said is as part of this package we should renew that payroll tax cut so that consumers still have more in their pockets next year until the economy gets a little bit stronger.

I’ve said that we have to renew unemployment insurance for another year because obviously the economy is still not generating enough jobs and there are a lot of folks out there who are hugely reliant on this.  But it’s also unemployment insurance is probably the money that is most likely to be spent.  By definition, people need it, and so it re-circulates in the economy and it has an effect of boosting aggregate demand and helping the economy grow.

So as much as possible, what I’m trying to do is to make sure that we have elements in this package that focus on growth now.  And then I think it’s going to be important for us to, as soon as we get this debt limit done, to focus on some of the things that I mentioned at the top:  patent reform, getting these trade deals done, doing an infrastructure bank that would help to finance the rebuilding of America and putting a lot of workers who’ve been laid off back to work.  We don’t have time to wait when it comes to putting folks back to work.

Now, what you’ll hear from the other side is the most important thing for putting people back to work is simply cutting taxes or keeping taxes low.  And I have to remember — I have to remind them that we actually have sort of a comparison.  We have Bill Clinton, who created 22 million jobs during the eight years of his presidency, in which the tax rates were significantly higher than they are now and would be higher even if, for example, the tax breaks for the high-income Americans that I’ve called for taking back, even if those got taken back taxes would still be lower now than they were under Bill Clinton, but the economy did great; generated huge amounts of jobs.  And then we had the eight years before I was elected, in which taxes were very low, but there was tepid job growth.

Now, I’m not saying there’s an automatic correlation.  But what I am saying is that this theory that the only thing — the only answer to every economic problem we have, the only answer for job creation is to cut taxes for the wealthiest Americans and for corporations is not borne out by the evidence.  (Applause.)  And we should be a little more creative in how we think about it. (Applause.)

The last thing I’ll say, because we’ve got a lot of young people here, I know that sometimes things feel discouraging.  We’ve gone through two wars.  We’ve gone through the worst financial crisis in any of our memories.  We’ve got challenges environmentally.  We’ve got conflicts around the world that seem intractable.  We’ve got politicians who only seem to argue.  And so I know that there must be times where you kind of say to yourself, golly, can’t anybody get their act together around here?  And what’s the world that I’m starting off in, and how do I get my career on a sound foundation?  And you got debts you’ve got to worry about.

I just want all of you to remember, America has gone through tougher times before, and we have always come through.  We’ve always emerged on the other side stronger, more unified.  The trajectory of America has been to become more inclusive, more generous, more tolerant.

And so I want all of you to recognize that when I look out at each and every one of you, this diverse crowd that we have, you give me incredible hope.  You inspire me.  I am absolutely convinced that your generation will help us solve these problems. (Applause.)  And I don’t want you to ever get discouraged because we’re going to get through these tough times just like we have before, and America is going to be stronger, and it’s going to be more prosperous, and it’s going to be more unified than ever before, thanks to you.  (Applause.)

God bless you all.  God bless America.  (Applause.)

END 12:07 P.M. EDT

William E. Leuchtenburg: Obama like FDR? Not at all, it turns out


History Buzz

Source: WaPo, 7-22-11

Remember when Barack Obama was supposed to be the second coming of Franklin D. Roosevelt?

As the president took office, historians and columnists reveled in the comparison. Historian William E. Leuchtenburg, the author of “Franklin D. Roosevelt and the New Deal,” told NPR that he heard echoes of FDR in Obama’s inaugural address. Before that, Time magazine featured the president-elect on its cover, smiling and, FDR-like, smoking a cigarette in a 1930s roadster. “The New New Deal,” the headline proclaimed. And in the essay inside, “The New Liberal Order,” journalist Peter Beinart likened Obama’s coalition to FDR’s and posited that “if [Obama] can do what F.D.R. did — make American capitalism stabler and less savage — he will establish a Democratic majority that dominates U.S. politics for a generation.” Just like FDR.

We still don’t know exactly which former president Obama will most closely resemble. But now, after he has putcuts to Social Security on the table as part of debt negotiations with the GOP, we can finally and definitively nix Roosevelt, the liberal lion of the 20th century, from the list of parallels. Our 44th president is not a champion of liberal reform a la FDR, nor does he live in a political universe in which “bold and persistent experimentation,” as FDR promised in 1932, is even possible. Obama may turn out to be like any of his 43 predecessors — just not Roosevelt.

Not convinced? Begin with FDR’s record.

From his first day in office, Roosevelt was the father of reform. In his portrait of the period, Leuchtenburg, a professor emeritus at the University of North Carolina, defined FDR’s New Deal as a critical turning point in American history. It offered, as Leuchtenburg describes, “deficit spending, a gigantic federal works program, federal housing and slum clearance, the NRA, the TVA, sharply increased income taxes on the wealthy, massive and imaginative relief programs, [and] a national labor relations board with federal sanctions to enforce collective bargaining” — not to mention Social Security.

Until the pendulum swung back during the Reagan revolution and the George W. Bush presidency, FDR’s efforts transformed citizens’ convictions in and expectations of their government. As Leuchtenburg writes, Roosevelt’s tenure “marked a radical departure” from unchecked capitalism by providing every American with at least the minimum standard to live decently.

And then there’s our current president….READ MORE

History Q & A: What is the Debt Ceiling and it’s History?

History Q & A


Everything you need to know about the debt ceiling in one post

What it is: The debt ceiling is a legal cap on the amount of money the Treasury can borrow to fund existing government functions. It essentially authorizes the Treasury to borrow the money necessary to pay the bills incurred by the federal government.

Where it came from: Before 1917, Congress authorized the Treasury to issue bonds for specific purposes. But that meant approving every bond separately. To fund World War I, Congress decided to give the Treasury more latitude by instituting caps on how much it could borrow through each type of bond, rather than forcing it to get every new bond approved separately. In 1939, this was changed so that most bonds were bound by the same limit, effectively creating the general debt ceiling we have today.

How has it worked? The debt ceiling has traditionally been raised as a matter of course whenever Congress passes spending bills requiring more borrowing, though the opposition party has often voted against increases to signal its opposition to the majority’s deficit spending. Between 1940 and 2010, we have increased the debt limit more than 70 times, and from 1979 to 1995, a House rule proposed by Rep. Richard Gephardt made increases automatic by raising the ceiling whenever new spending is approved. The new Republican majority repealed this rule in 1995 in order to use raising the debt ceiling as leverage in getting President Clinton to agree to spending cuts.

Why it’s an issue now: Currently, the debt limit is set at $14.3 trillion. Around Aug. 2, the Treasury will exhaust that borrowing authority. Because spending currently exceeds revenues by almost 45 percent, if that happens, we will either have to default on our debt or stop funding a substantial portion of the government. Congress could simply choose to raise the debt ceiling, but like the 1995 House GOP, the 2011 House GOP is insisting that it will not increase the debt ceiling without large spending cuts from President Obama.

What happens if we don’t raise the debt ceiling but continue to pay interest on our bonds? This is an option known as “prioritization.” The Bipartisan Policy Center released a report attempting to think through how this would work in practice, as it has never been attempted before. The raw numbers are chilling: In August, the federal government would have to cut expenditures by about $134 billion, or 10 percent of the month’s GDP. If it chose, for instance, to fund Medicare, Medicaid, Social Security, supplies for the troops and interest on our bonds, it would have to stop funding every other part of the federal government. The drop in demand, when coupled with the turmoil in the markets and the general financial uncertainty, would undoubtedly throw the economy back into a recession. Also keep in mind that we have to roll over $500 billion in debt that month, and if there was uncertainty about how we were going to pay our bills, it is not clear we could find buyers for our debt at anything less than an exorbitant rate. In this way, “prioritization” could actually increase the deficit.

What happens if we stop paying the interest on our debt? This is too scary to consider for any serious length of time. Treasury securities sit at the base of the global financial system. They are considered so safe that the interest rate on Treasuries is called the “riskless rate of return,” as the market assumes there is no chance of default under any circumstances. Almost all other types of debt — mortgages, credit card, auto loans, business loans, hospital bonds, etc. — are yoked to Treasuries. Almost all major financial players hold substantial portfolios of Treasuries or Treasury-related debt in order to buffer themselves against financial shocks. Consider that the 2007 financial crisis was caused by the market realizing it had to reassess the risk of bonds based on subprime mortgages. If the market has to reassess the risk of Treasuries, the resulting financial crisis will be beyond anything we’ve ever seen in this country.

Do we need a debt ceiling? Strictly speaking, no. The debt ceiling is unique to America. In other countries, when the legislature passes a law, the Treasury is given automatic authority to carry it out. A number of former Treasury Secretaries have said it should be abolished, including Larry Summers, who said, “I think that given that Congress has to approve all spending and all tax changes, there is not much logic to the debt ceiling.”

Does the debt ceiling reduce deficits? In general, no. The nonpartisan Congressional Budget Office examined this issue and concluded (pdf) that “setting a limit on the debt is an ineffective means of controlling deficits because the decisions that necessitate borrowing are made through other legislative actions. By the time an increase in the debt ceiling comes up for approval, it is too late to avoid paying the government’s pending bills without incurring serious negative consequences.”

Is the debt ceiling unconstitutional? A number of commentators have suggested that the 14th Amendment, which states that “the validity of the public debt of the United States … shall not be questioned,” renders the debt ceiling unconstitutional. Others have disagreed, including Lawrence Tribe, a professor of constitutional law at Harvard, who notes that the Constitution gives Congress the sole power “to borrow money on the credit of the United States.” Ultimately, this point is probably moot, at least for the time being, as the Treasury Department has stated that it agrees with Professor Tribe’s interpretation.

What are the deals that Congress is considering in order to raise the debt limit, and could you rank them from most-to-least likely?


* McConnell and McConnell-Reid: Senate Minority Leader Mitch McConnell proposed giving Obama the unilateral power to increase the debt ceiling, with Congress capable of blocking him if it passed and overrode his veto on resolutions condemning the increase in the limit. The idea would be to force Democrats to vote repeatedly in favor of increasing the debt ceiling, while allowing House Republicans to vote against it without forcing the U.S. to prioritize programs or default. House Republicans rejected this as a giveaway to the administration, so to make it more palatable to them McConnell and Senate Majority Leader Harry Reid have been working on attaching $1.5 trillion in spending cuts and an expedited congressional process for approving them to the plan.

* A big deal: In negotiations with congressional Republicans, Obama pushed for a deal to cut the deficit by $4 trillion over 10 years through a combination of discretionary cuts, changes to entitlements such as Social Security and Medicare, and revenue increases achieved through cutting tax breaks. Specific options considered as part of this plan included an increase in the Medicare retirement age, reducing the rate of growth for Social Security benefits, and cuts to the employer health care tax deduction. House Speaker John Boehner and Majority Leader Eric Cantor rejected the big deal, but it appears to be making a comeback.

* A small deal: Negotiations between the administration and congressional Republicans uncovered between $1 trillion and $2 trillion in spending cuts that both the Democrats and the Republicans could accept. The Democrats would like to see these spending cuts accompanied by new revenues, but there have been some intimations that the Obama administration could accept a deal with $1.5 trillion in spending cuts and no new revenues. The most specific look we’ve gotten at these cuts came in a slideshow presented by Eric Cantor and leaked to the press.

* A clean debt limit increase: For the first few months of negotiations, the White House stated that it wanted a “clean” debt limit increase, not paired with any spending cuts or rule changes. When it became clear Congress would not vote for this, the administration abandoned the call and started working out a deal. On May 31, the House voted overwhelmingly against a clean debt limit increase, in an attempt by House Republicans to get Democrats on record supporting it. You can argue, however, that McConnell’s proposal is essential a clean increase.

* Cut, Cap, Balance: Rep. Jason Chaffetz introduced a bill, backed by the House Republican leadership, called “Cut, Cap, and Balance,” which would increase the debt ceiling in exchange for $111 billion in immediate cuts next year, statutory caps on spending, and a balanced budget amendment to the Constitution that includes a spending cap of 18 percent of the previous year’s GDP and would require supermajorities to raise taxes or increase the debt ceiling. If the amendment was ratified, spending would have to drop to its lowest levels since the 1950s — despite the fact that we now have Medicare, Medicaid, more seniors, etc. — and taxes would be almost impossible to raise. The White House has promised to veto the bill, saying that deficit reduction does not require changes to the Constitution, and that the cuts involved are draconian.

Further reading:

*The Committee for a Responsible Federal Budget’s comprehensive primer on the debt ceiling.

*The Congressional Budget Office’s report on “Federal Debt and Interest Costs.”

*The Government Accounting Office’s report on past efforts to manage delays in lifting the debt ceiling.

*The Bipartisan Policy Center’s analysis of what will happen if we pass the Aug. 2 deadline without lifting the debt ceiling.

History Q & A: What Event in U.S. History Most Resembles the Debt Ceiling Crisis of 2011

History Q & A



Debt Ceiling Showdown, 2011 & Shays Rebellion 1786: For Debt Crisis Lessons, Look Back 225 years

Shays' Rebellion, an armed uprising in Massachusetts in the 1780s, may offer lessons in today's standoff over the debt ceiling.
Shays’ Rebellion, an armed uprising in Massachusetts in the 1780s, may offer lessons in today’s standoff over the debt ceiling.
  • Same issues in today’s debate over debt crisis also drove Shays’ Rebellion of 1786
  • Nation’s leaders opted for robust U.S. government after uprising led by New England farmer
  • But debate still stirs about the size and power of the federal government
  • Compromise rarely has resolved protracted political gridlock in the U.S., historians say

(CNN) — America’s political leaders are paralyzed. The government is reeling from debt. Corrupt bankers foreclose on people’s homes as a brutal recession sweeps the land.

We’re talking, of course, about the great debt standoff of 1786: Shays’ Rebellion.

Nervous Americans glancing at the upcoming August 2 deadline for raising the debt ceiling are being told that the nation is entering uncharted territory. But historians say they’ve seen this movie before.

Many of the same issues driving this modern-day standoff — disagreement on how to handle the national debt, ineffective government and a populist citizen’s revolt — drove the 18th-century uprising that’s been called America’s first civil war.

Historians say the lesson that can be drawn from Shays’ Rebellion and other transformative events in U.S. history is this: Protracted political gridlock is seldom resolved through compromise. It comes when one political party finally beats the other down.

Many Americans, however, have told pollsters that they want the political parties to work together to solve the debt ceiling crisis. Yet political stability doesn’t always come through give-and-take, some historians say

“There are times when only the outright defeat of political enemies can bring about needed reform,” says Richard Striner, a history professor at Washington College in Chestertown, Maryland.

“It was only by confronting and defeating the aggressive leadership of the slave states that Lincoln and the Civil War Republicans rid the nation of slavery.”…READ MORE

Full Text July 22, 2011: NPR’s Interview With President Obama



NPR’s Interview With President Obama In Full

Source: NPR, 7-22-11

MICHEL MARTIN (host): Mr. President, welcome to the program, thank you so much for joining us.

President BARACK OBAMA: Thank you so much for having me.

MARTIN: Of course, we want to talk about the negotiations over the debt and the debt ceiling on Wednesday. You said that you like the compromise offered by the so-called Gang of Six, that bipartisan group of three Republican and three Democratic senators. What’s in this plan that’s been missing from earlier efforts, that makes it appealing to you?

OBAMA: Well actually, it’s not so much that it’s hugely different from some of the previous frameworks that were, for example, put out by my fiscal commission or that I talked about several months ago. What was different was that you had Republican senators acknowledging that revenues need to be part of a balanced package. And you had Democratic senators acknowledge that we’re going to have to make some difficult spending cuts in order to achieve the kinds of debt and deficit reduction that are important to the economy. So what I’ve said consistently, and what I think this bipartisan group of senators confirmed — and frankly, what everybody who has looked at this who’s outside the political process has acknowledged – is, is that in order for us to solve the debt and deficit problems, we’ve got to cut spending that we don’t need; we have to eliminate programs that may not be working; we’ve got to make some tough decisions around things like defense spending as well as domestic spending.

But we’re also going to have to have more revenues, and we can do that in a way that is not hurting the economy; in fact, that could potentially help the economy by closing up some loopholes that distort the economy. So my hope is, is that with that acknowledgement that we need a balanced approach, that Republican leaders on Capitol Hill are going to be willing to engage in the kind of compromise that can resolve this problem.

MARTIN: What do you think the hold-up has been so far? Do you think that people – there are people who really do not believe the consequences will really be as dire as many people say they will be if the debt ceiling is not raised? Do you think it’s the case that some people won’t support a compromise just because you do? What – what do you think the hold up’s been?

OBAMA: Well, probably a little bit of all of the above. You’ve got some members of the Republican Party who’ve been downplaying the consequences of default. The irony is, you know, Ronald Reagan, I think, when he was president, repeatedly talked about how irresponsible it would be to allow the full faith and credit of the United States to be impaired in any kind of way. I think that there is some politics. And compromising with me, among some Republican leaders, is bad politics for them.

I also think that — in fairness — that the decisions we’ve got to make right now are tough ones, and nobody likes them. I mean, it’s always easier to give people more benefits and cut their taxes than it is to raise more revenue and reduce benefits. And so what we’ve got to do is to have an honest conversation with each other about each side taking on some of their sacred cows.

And frankly, that’s what the American people expect. I mean, what you’ve been seeing in recent polling is, the American people agree with the approach that I’ve talked about — a balanced approach. Even the majority of Republicans agree that it shouldn’t just be spending cuts; that those, like myself, who’ve been incredibly blessed and can afford to pay a little more, or oil companies that are doing very well and don’t need the tax breaks that are currently in the tax code, that we’ve got to make some sacrifices as well to solve the problem.

MARTIN: Well, let’s talk a little bit more about those sacrifices, though. We’ve talked a lot about taxes and raising taxes, and the argument around that. But let’s talk about it the other way. Specifically this plan, this bipartisan plan would trim the amount that goes into entitlement programs. Now, you’ve been saying everybody’s got to give something…

OBAMA: Right.

MARTIN: …and you’re willing to give up on some things that are important to other Democrats, to progressives. But what about — what is your message to Democrats — and perhaps I should say progressives — who say that the most vulnerable people in this country have already suffered too much in recent years and gotten too little?

OBAMA: Well, I think what’s absolutely true is, is that core commitments that we make to the most vulnerable have to be maintained. And so a lot of the spending cuts that we’re making should be around areas like defense spending, as opposed to food stamps. I do think that when it comes to entitlements, when we’re talking about Social Security and Medicare, that those aren’t entitlement programs where people aren’t contributing; it would be that they are social insurance programs that people have been making contributions to, and they are the most important part of our social safety net so that when people retire, they can retire with dignity and respect.

What is true is that given the rising number of seniors, and given the huge escalation in health-care costs, that if we don’t structure those programs so that they are sustainable, then it’s going to be hard for the next generation to enjoy those kinds — same kinds of benefits. And so we are going to have to make some modest changes that retain the integrity of the program, but make sure that they’re there for years to come. And that’s not even just a deficit problem, that’s a — a step that even if we were all Democrats up here on Capitol Hill, we’d have to start making, to make sure that the integrity of those programs are preserved.

MARTIN: Let’s talk about the unemployed for a minute.

OBAMA: Right.

MARTIN: I think you probably know the numbers better than I do…

OBAMA: Right.

MARTIN: But just for those who don’t, that there are 14 million Americans who don’t have jobs right now. Perhaps the real number might be as high as 16 million, and the overall rate is 9.2 percent. Among Latinos, it’s 11.6 percent; among African Americans, it’s 16 — 16.2 percent, which is a very large number. You know, there’s — so much of the conversation in recent days has been around the debt, the $14 trillion debt. What do you say to people who might be listening to our conversation right now, who are unemployed, and who are saying: When will there be daily meetings about us?

OBAMA: Well, first of all, in the White House there are daily meetings about the unemployed. The single most important thing we can do for the economy is putting people back to work. And by the way, if we put more people back to work, that in and of itself reduces the deficit because those folks are paying taxes and less in need of things like unemployment insurance and — and that’s part of the reason why the deficit exploded over the last decade. But also over the last two years, in particular, is because a lot of folks have been not getting raises, not seeing their wages increase. Or they’ve been losing their jobs, or they

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