Obama's confusing debt ceiling gambit 

The Obama administration’s position on the debt ceiling continues to get more confusing. At his press conference today, President Obama called out Republican congressional leaders who walked out of negotiations with Vice President Joe Biden last week, declaring, "They need to do their job.”

“If everyone else is willing to take on their sacred cows and do tough things in order to achieve the goal of real deficit reduction, I think it will be hard for Republicans to stand there and say a tax break for corporate jets is sufficiently important that we’re not willing to come to the table and get a deal done,” the president said.

What sacred cows, exactly, have the Democrats expressed a willingness to take on? We don’t know, because most of these negotiations have been conducted behind closed doors. But Democrats have blasted Republicans for trying to reform Medicare and Medicaid, and they have expressed no public willingness to seriously address entitlement reform.

Democrats want an increase in the debt ceiling. Republicans want spending cuts. So House Speaker John Boehner has staked out a very reasonable position: for every dollar the debt ceiling is increased, there must be at least a dollar in spending cuts.

Democrats have responded by insisting that any large-scale spending cuts be accompanied by tax increases. It would be more understandable if Democrats were asking for those tax hikes as a tradeoff for spending cuts alone. However, Republican demands for spending cuts are already a tradeoff for the debt-ceiling increase. It's is like trying to sell the same item twice.

To add to the confusion, the president is also calling on Congress to extend his year-long payroll tax holiday, which took effect this year. Most people will be happy about this, but at $120 billion it more than offsets the $3 billion corporate jet deduction that Obama denounced six times in his press conference today.

So Democrats are hoping to cut some taxes, raise others, and resist spending cuts. See why the estimated deficit for 2011 is over $1.6 trillion?

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Staff Report

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A daily newspaper covering San Francisco, San Mateo County and serving Alameda, Marin and Santa Clara counties.
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