Republican leaders, pressed by a large contingent of new tea party-backed members, have demanded that any deal include spending cuts to equal the amount the $14.3 trillion debt ceiling is raised - at least $2 trillion.
Negotiations collapsed Thursday when House Majority Leader Eric Cantor, Virginia Republican, walked out after complaining that Democrats refused to budge on their demand for tax increases. Mr. Kyl, the only other Republican member of the Biden panel, quickly followed suit, essentially rendering the group dead.
Democrats and the White House have accused Republicans of falsely suggesting that they want to raise taxes on average Americans. Rather, Democrats say, they want to close certain tax “loopholes” for wealthy corporations.
“How do you call closing loopholes to oil companies that are making billions of dollars in profits … how do you call that a tax hike?” Rep. James E. Clyburn, South Carolina Democrat, said Sunday on ABC’s “This Week.”“I don’t know of anybody who would define a tax increase as closing the loophole.”
Democrats added they have been willing to accept some GOP demands, such as reductions in Medicare spending, though no cuts in benefits.
“This was not about coming to an impasse,” Sen. Charles E. Schumer, New York Democrat, said Friday regarding the breakdown of the Biden panel. “There was just a lack of political will by Republicans to accept the kind of compromise that was taking shape.”