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President Barack Obama abruptly walked out of a stormy debt-limit meeting with congressional leaders Wednesday, throwing into serious doubt the already shaky negotiations, according to GOP sources “He shoved back and said ‘I’ll see you tomorrow’ and walked out,” House Majority Leader Eric Cantor (R-Va.) told reporters in the Capitol after the meeting. On a day when the Moody’s rating agency warned that American debt could be downgraded, the White House talks blew up amid a new round of sniping between Obama and Cantor, who are fast becoming bitter enemies.
When Cantor said the two sides were too far apart to get a deal that could pass the House by the Treasury Department’s Aug. 2 deadline —and that he would consider moving a short-term debt-limit increase alongside smaller spending cuts —Obama began to lecture him. “Eric, don’t call my bluff,” the president said, warning Cantor that he would take his case “to the American people.” He told Cantor that no other president —not Ronald Reagan, the president said —would put up with the treatment he was getting from the House majority leader.
Democratic sources dispute Cantor’s version of Obama’s walk out, but all sides agree that the two had a blow up. The sources described Obama as "impassioned” but said he didn’t exactly storm out of the room. “Cantor’s account of tonight’s meeting is completely overblown. For someone who knows how to walk out of a meeting, you’d think he know it when he saw it,” a Democratic aide said. “Cantor rudely interrupted the president three times to advocate for short-term debt ceiling increases while the president was wrapping the meeting. This is just more juvenile behavior from him and Boehner needs to rein him in, and let the grown-ups get to work. “
On exiting the room, Obama reportedly said that “this confirms the totality of what the American people already believe” about Washington, said a Democratic official familiar with debt negotiations, that officials are “too focused on positioning and political posturing” to make difficult choices. The latest and sharpest in a series of harsh exchanges between the two leaders heightened concern that markets could crash at any time amid fear of a reduction in the rating on once-ironclad U.S. debt.
Cantor accused the president and congressional Democrats of progressively low-balling, over the last several days, the savings that could be achieved from proposals discussed by Vice President Joe Biden’s working group on deficit reduction. Cantor warned that the group has not identified enough cuts to win House passage of a $2.5 trillion debt-limit increase —the size the president says is needed to get through the 2012 election, sources told POLITICO. Obama told Cantor that he would either have to agree to tax increases or give up on his demand that the debt hike be matched dollar-to-dollar to the cuts —that is, $2.5 trillion in deficit-reduction over 10 years in exchange for a $2.5 trillion hike in the debt ceiling.
He said that the negotiators should return to the White House Thursday to discuss savings from health care programs, budget caps and options for raising revenue. “Then he said we also ought to get in the mode here, because we’re going to have to decide by Friday which way we’re going,” Cantor said. “He said really we ought to all start to think about things we can do rather than things we can’t.” That’s when Cantor said he would be willing to abandon his own insistence on having just one vote on the debt ceiling if they could agree to a smaller package of cuts in exchange for a shorter-term hike that would require another increase before the 2010 election.
But Obama said he wouldn’t do the debt-limit increase incrementally and that he would veto a short-term bill. “That’s when he got very agitated,” Cantor told reporters. “Obama lit him up. Cantor sat in stunned silence,” said an official in the meeting. “It was incredible. If the public saw Obama he would win in a landslide.” House Minority Whip Steny Hoyer (D-Md.) said no progress was made in the Wednesday talks. “The president is spending a lot of time and effort to get us to an agreement, and it is tough,” Hoyer said.
Cantor said he’s trying to inform the group of what House members will agree to pass. “I’m trying to represent where the votes are in the House. and we’ve always said the votes in the House are consistent with the principles that the speaker’s laid out that we’ve been operating on,” Cantor said. “It is dollar-for-dollar match, it is the no tax increase and it is this other subject that we are discussing tomorrow the enforcement mechanisms … I understand why he’s frustrated. But again, we’re trying to get this thing done, and that’s why I was a little taken aback.”
