Senate GOP shows flexibility in debt, budget fight

Senate GOP shows flexibility in debt, budget fight
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Wednesday, July 20, 2011 - 2:13am

Senate Republicans are showing far more flexibility than their tea party-backed House colleagues as Washington policymakers seek to steer the government away from a first-ever default on its financial obligations.

As the House doubled down on a symbolic vote to condition any increase in the government's borrowing authority on congressional passage of a balanced budget constitutional amendment and a fresh wave of spending cuts, the warm reception by many Senate Republicans to a new bipartisan budget plan revealed a thawing in GOP attitudes on new tax revenues.

The plan by the Senate's so-called Gang of Six is far too complicated and contentious to advance before an Aug. 2 deadline to avoid a default that Treasury Secretary Timothy Geithner and other experts warn would rattle markets, drive up interest rates and threaten to take the country back into a recession. But its authors clearly hope it could serve as a template for a "grand bargain" later in the year that could erase perhaps $4 trillion from the deficit over the coming decade.

In the House, the 234-190 vote Tuesday to pass the House GOP "cut, cap and balance" plan reflected the strength of tea party forces elected in last year's midterm election. GOP conservatives reveled in their victory, however temporary it may be, since the plan faces a White House veto threat and is a dead letter in the Senate anyway.

"Let me be clear. This is the compromise. This is the best plan out there," said Rep. Jim Jordan, R-Ohio, head of a conservative House group known as the Republican Study Committee.

The GOP measure would impose an estimated $111 billion in immediate spending cuts next year and would cap overall spending at levels called for in the House's April budget plan, backed up by the threat of automatic spending cuts. But what conservatives like most about it is its requirement that Congress approve a balanced budget amendment to the Constitution - a step that requires a two-thirds vote in both House and Senate - before any increase in the current $14.3 trillion debt limit can be shipped to Obama.

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