Two local congressmen not budging on debt, taxes

As Washington careens toward the Aug. 2 deadline to raise the national debt ceiling and avoid an unprecedented default that could lower the United States' credit rating, this area's two members of Congress reiterated national Republican calls for deep spending cuts.

U.S. Reps. Bob Gibbs, R-Lakeville, and Bill Johnson, R-Marietta, are among freshmen members of Congress who won seats last year with support from Tea Party groups in their east and southeast Ohio congressional districts. Both unseated incumbent Democrats whose seat previously had been considered safe.

As of yesterday, negotiations remained stalled in the nation's Capitol, and House Republicans and Senate Democrats were each fine-tuning competing plans to resolve a looming potential financial crisis.

The Congressional Budget Office sent Republicans back to the drawing board as it said the plan they presented did not match the promises they made with regard to it. Meanwhile, the CBO said the Democratic plan would produce $2.2 trillion in savings over 10 years, much of which would come from savings related to winding down the wars in Iraq and Afghanistan.

From a political perspective, the Republican plan would raise the debt ceiling in a short-term way, allowing for this debate to return in the middle of the 2012 election campaign. The Democratic plan would put off any future debate about the debt ceiling until after the 2012 election is over.

In Ohio's 18^th Congressional District, which covers the northern portion of Athens County, Rep. Gibbs said Monday that he was disappointed in Senate Democrats for not accepting the so-called "cut, cap and balance" Republican plan that they passed in the House last week.

"I was disappointed that (Senate Majority Leader) Harry Reid didn't at least pick it up for debate," Gibbs said. "They just tabled it."

President Barack Obama promised to veto that legislation even before it was sent to the U.S. Senate.

"They ought to at least debate it," Gibbs said. "If they don't like it, they have the prerogative to gut that bill and put their own plan in. They didn't even do that."

Gibbs also called for a balanced budget amendment to the U.S. Constitution, citing 49 states that have such laws on their books.

"If you look at the history of Congress going back 30-plus years, they haven't done a very good job of controlling their spending," he said. "They've done short-term fixes I think the only way we're going to get this done is a balanced budget amendment, like 49 states have to do and families and businesses have to do."

He also questioned the president's seriousness when it comes to cutting spending, saying that his plan focuses on too far in the future.

"The stuff he's been talking about is spending six to 10 years out, and raising taxes next January," he said. "I don't know if he's really serious about cutting spending and getting our fiscal house in order."

Gibbs called for reforms to Medicare and Medicaid, as well as Social Security to fix long-term insolvency issues.

"Doing nothing is not an option," he said. "We need to put some reforms in there to strengthen them so that those programs will be around for the future. Right now it's not sustainable."

In Ohio's 6^th Congressional District, which covers the rest of Athens County, Rep. Johnson said last week that America has a spending problem in Washington.

"America is in debt not because the federal government taxes too little. We're in debt because the federal government spends too much," he argued. "And cutting spending, both in discretionary spending and unfunded mandates that have been out there for year, that's where the problem lies."

He said that the big question is what happens when the credit limit gets busted and it becomes a choice between paying the bills and letting credit be ruined.

"Most of us are going to pay the bill," he said. "But we're going to cut up the credit card and make sure that (it) doesn't happen again. But we're going to pay the bill."

Johnson said the goal has to be to manage the debt crisis in a fiscally responsible way that will avoid a similar mess in the future.

He called for trillions of dollars in spending cuts, dismissing billions in cuts as not enough.

"I'm going to be looking for trillions of dollars in spending cuts," he said. "I'm also going to be looking for a balanced budget amendment."

He also called for tax reform to let businesses and individuals keep more of what they earn. He said he would not consider any tax increases as revenue enhancements.

"I don't believe that increasing taxes on Americans right now and on businesses right now is going to help get our economy started," he said. "We have a clear history, that when you decrease taxes you get an economic boost because Americans spend more, they invest more, and everybody gets economic confidence."

Meanwhile, Democratic Congressional Campaign Committee spokesperson Haley Morris said that hardline GOP congressmen like Johnson and Gibbs are putting the American economy in danger by their stances and actions.

"Representatives Johnson and Gibbs along with House Republican leaders are recklessly endangering our economy and future by asking the middle income families and seniors to make additional sacrifices to reduce the deficit, while not asking big oil and the ultra rich for a dime," she said. "It's time Representatives Johnson and Gibbs take a stand to cut spending by forcing big oil companies and multi-millionaires to pay their fair share, because it's unacceptable to reduce the deficit on the backs of the middle class and seniors."

Morris characterized House Speaker John Boehner, R-Ohio, as bowing to pressure from the most extreme elements of his party when he walked away from a big budget deal with President Obama.

The $3 trillion to $4 trillion agreement would have included a mixture of huge budget cuts and tax increases, with the latter mainly in the form of closed loopholes. Three-quarters of the budget savings would have been on the spending side. The deal, which Boehner rejected at the 11^th hour under pressure from Tea Party conservatives in Congress, also would have included tax and entitlement reforms, longtime goals of fiscal conservatives in Congress.

On Tuesday, Morris said the Republican rejection of the budget agreement protected tax breaks for "big oil and billionaires."

She said that economists have "made clear" that Johnson, Gibbs and House Republicans "failing to raise the nation's credit limit" could result in stock prices and pensions falling, home sales plummeting, Social Security checks stopping, and interest rates for consumers rising. She said Boehner's new plan could still put the economy at risk.

She cited a CNN report that Boehner's debt plan would not meet the threshold of ratings agencies to avoid a downgrade of the nation's debt, and noted that the Democratic plan would preserve the country's AAA credit rating.

Gibbs said, however, that a downgrade of credit rating is inevitable.

Morris also cited a report from CBS News that any variable rate borrowing done in the United States, from credit card balance to private college loans, would likely rise along with the general rise of interest rates that would accompany a downgrade in the U.S. credit rating.

Mark Zandi, chief economist of Moody's credit rating agency, has warned that "we go into recession" if Congress fails to raise the debt limit.