Open

Coming up

Don't miss

Replay


LATEST SHOWS

AFRICA NEWS

Ebola in Nigeria: First death outside of Lagos

Read more

AFRICA NEWS

Niger : Top Oppostion figure to be questioned in baby trafficking scandal

Read more

AFRICA NEWS

Liberia: President dismisses top officials who ignored call back

Read more

MEDIAWATCH

The deleted tweets of Manuel Valls

Read more

DEBATE

How to Stop Ebola: WHO Says Cases Could Exceed 20,000 (part 2)

Read more

DEBATE

How to Stop Ebola: WHO Says Cases Could Exceed 20,000

Read more

WEB NEWS

'Ice Bucket Challenge' angers anti-abortion activists

Read more

#TECH 24

Tomorrow's Transport Today

Read more

FOCUS

Mothers and children leaving Honduras at all costs

Read more

  • French businesses ‘hoping for a new Thatcher’

    Read more

  • UN says 43 peacekeepers captured in Golan Heights

    Read more

  • Peru seizes record 6.5 tonnes of Europe-bound cocaine

    Read more

  • Russian troops have entered Ukraine, says Kiev

    Read more

  • PSG face Barcelona, Ajax in tough Champions League draw

    Read more

  • In pictures: Billions of locusts invade Madagascan capital

    Read more

  • Brad Pitt and Angelina Jolie say ‘I do’ in France

    Read more

  • Erdogan sworn in as Turkey's president

    Read more

  • Assad cannot be partner in fight against terrorism, says Hollande

    Read more

  • New Ebola case in Nigeria brings death toll to 1,552

    Read more

  • Video: 'Neither Baghdad nor the US can defeat the Islamic State'

    Read more

  • Platini will not run against Blatter for FIFA presidency

    Read more

  • Air France pilots announce week-long strike in September

    Read more

  • New French economy minister takes swipe at 35-hour work week

    Read more

  • Uzi shooting by 9-year-old rekindles gun debate

    Read more

  • Mother of American journalist asks IS leader for his release

    Read more

  • UN probe accuses Syrian regime, Islamists of ‘crimes against humanity’

    Read more

  • Uruguayans sign up to grow marijuana at home

    Read more

  • Missouri governor appoints black public safety director

    Read more

Americas

US debt reduction panel expected to concede failure

Video by Philip CROWTHER

Text by News Wires

Latest update : 2011-11-20

The latest bid to find a long-term solution to the US debt crisis looked doomed to fail Sunday as lawmakers remained at odds over money-saving measures including cutting social programmes and raising taxes on the rich.

REUTERS - The U.S. congressional deficit-reduction committee is likely on Monday to concede failure in its efforts to strike a deal, barring an unforeseen breakthrough to bridge deep partisan differences over taxes and spending, congressional aides said.

The announcement of failure would come on Monday, aides from the Republican and Democratic camps told Reuters on Sunday, shortly after several lawmakers on the bipartisan 12-member “super committee” cast strong doubts about a deal on the Sunday talk shows.

On NBC’s “Meet the Press” program, neither Republican Senator Jon Kyl nor Democratic Senator John Kerry gave any indication a deal was near. After months of working together on the panel, they each stuck to their parties’ entrenched positions and blamed the other side for the deadlock.

Their antagonism bolstered the belief that failure was the most likely outcome as the clock ticks toward the Wednesday midnight deadline for the panel to vote on a package of at least $1.2 trillion in deficit reduction over the next decade.

The failure for the committee of six Republicans and six Democrats, created in the wake of the bruising battle over the debt ceiling last summer, could cement American voters’ and global investors’ notions of a dysfunctional Washington.

Given unusual powers to tackle the U.S. government’s budget deficit and debt, which topped $15 trillion on Friday, the committee was seen by many as the best chance, in the near term, for the United States to get control of its deficits.

If the panel does not reach consensus, automatic spending cuts of $1.2 trillion over a decade are due to start in 2013.

The deadlock focuses on Republican opposition to tax increases, particularly on the wealthiest Americans, and Democratic refusal to cut into federal retirement and healthcare benefits without such tax increases.

While the markets’ expectation for a deal was low, with an election year ahead and the ugly debate on the debt ceiling not far behind, investors remained concerned about the inability of Congress to compromise. They fear deadlock may hurt White House efforts to extend a temporary payroll tax cut and jobless benefits for the long-term unemployed, further harming growth in the fragile economy.

‘That’s the law’

“I say to my Republican colleagues: we are here all day. We are ready to do $1.2 trillion, not less than it. That’s what we were told to do. That’s the law,” said Kerry, after accusing Kyl of not telling the truth about elements of the talks.

White House officials were conspicuously absent on the Sunday talk shows. President Barack Obama, just back from a nine-day Asia-Pacific tour, has kept his distance from the deficit committee as hopes for a deal continue to fade.

There was no sign that Obama was prepared to weigh in personally in a last-ditch push for an agreement.

Administration officials see little political fallout for Obama if the panel fails and believe there is still breathing room for a deal in coming months since automatic budget cuts would not kick in until early 2013.

Though many of the super committee members who appeared on Sunday talk shows spoke in past tense about the talks, the two co-chairs said they had not given up.

“I am ready to work with anybody who can say, that last divide, that they’re willing to cross that,” Democratic co-chair Senator Patty Murray said on CNN.

Murray said talks with Republicans were stuck on convincing them to agree to raise taxes on the wealthy to help bring down soaring budget deficits.

Hope versus reality

“Nobody wants to give up hope. Reality is, to some extent, starting to overtake hope,” Representative Jeb Hensarling, the panel’s Republican co-chairman, said on the program “Fox News Sunday.”

Murray said Republicans want to extend tax cuts that lowered individual rates—reductions that originated under former Republican President George W. Bush. Those tax cuts run out at the end of 2012.

Republicans have pushed for a permanent extension.

Democrats want the tax cuts for the rich to expire.

“In Washington, there are folks who will not cut a dollar unless we raise taxes,” said Kyl, sparking an exasperated reaction from Kerry who noted that Congress has cut about $1 trillion from the budget without any tax hikes.

Republicans want Democrats to agree to do more to find long-term savings in the growing costs of government retirement and healthcare programs.

If no deal is reached by a simple majority of the super committee, automatic spending cuts would start in 2013 -- two months after presidential and congressional elections.

Those cuts would be evenly divided between domestic and defense programs. Some Republican members of Congress already are talking about dismantling the automatic cuts to protect the Defense Department from deep reductions.

"To my ear, it sounds like a no deal," said Mark Zandi, chief economist at Moody's Analytics.

Date created : 2011-11-20

  • US POLITICS

    With new debt plan, Obama targets Democratic base

    Read more

  • USA

    US debt crisis deepens amid bitter standoff in Congress

    Read more

  • USA

    Republicans force fresh delay on crucial debt bill

    Read more

COMMENT(S)