Cantor opens the door to possible compromise in debt-limit talks
July 6th, 2011
06:27 PM ET
3 years ago

Cantor opens the door to possible compromise in debt-limit talks

(CNN)-A day before congressional leaders meet with President Barack Obama to discuss how to raise the debt limit, the number-two House Republican opened the door to possible compromise, saying Wednesday he is open to closing some of the tax "loopholes" that Democrats have been pushing, but only if those items are offset by reducing taxes in other areas.

"If the president wants to talk loopholes, we'll be glad to talk loopholes," House Majority Leader Eric Cantor said at his weekly session with reporters on Capitol Hill.

"We've said all along that preferences in the code aren't something that helps economic growth overall," Cantor said. But he immediately qualified his comment, noting, "We're not for any proposal that increases taxes and any type of discussion should be coupled with offsetting tax cuts somewhere else."

Cantor drew a distinction between closing tax "loopholes" - such as those for corporate jet owners - and other tax-related proposals raised by Democrats in the negotiations that he said the GOP could not accept because they amounted to tax hikes. Republicans have strongly opposed a proposal floated by Democrats to eliminate tax deductions for individuals making over $200,000 a year.

Cantor's comments Wednesday represented a change from the GOP message that tax revenues were off the table in the debt talks. While congressional Republicans have indicated that they would be willing to look at closing some loopholes, they have insisted up to now those changes had to be done as part of broader tax-reform effort that lowered corporate rates - not as part of a debt-limit agreement. In a sign that Cantor's remarks represented a shift, his office quickly circulated press reports covering his comments.

The majority leader pushed back at President Obama for saying that Republicans left the bipartisan negotiations led by Vice President Joe Biden because they opposed ending a tax loophole for corporate-jet owners, insisting, "that's just not the case."

"Clearly the other side wished to impose tax hikes on small businesses and families in this country," Cantor said.

Sen. Chuck Schumer, a Democratic leader, said his party's pressure had put Republicans on the defensive.

"Our focus on tax loopholes seems to be putting Republicans on their heels on the issue of revenues," Schumer said in a statement. "But if Republicans are going say we can only close these loopholes in a revenue-neutral way, it is like taking one step forward and then two steps back. The point isn't to get rid of these loopholes simply to pay for new tax breaks elsewhere; it's to do it in a way that contributes to the reduction of the debt."

A GOP aide told CNN that Cantor's comments were coordinated with Speaker John Boehner's office, and the two met Wednesday morning to discuss Boehner's meeting with Obama over the weekend and the upcoming White House meeting on Thursday.

Senate GOP Leader Mitch McConnell, asked whether he could support closing loopholes, appeared skeptical, telling reporters, "I'm open to tax reform; we need to do it broadly. To sort of cherry pick items in the context of this current negotiation with the White House strikes me as pretty challenging."

Cantor outlined the spending cuts in the Biden-led talks, indicating they could be a blueprint for a deal that could pass the House. Cantor said the group discussed cutting "non-health care" mandatory spending by over $300 billion; over $400 billion in health care mandatory spending; and a mix of discretionary spending reductions plus interest savings, which added up to more than $2 trillion in cuts over a ten-year period.

The number-two Republican echoed President Obama's opposition to any short-term approach to raise the debt limit for a few months. "I agree with him. We need to go and drive towards a deal which is not a deal which kicks the can down the road," Cantor said.


Filed under: Debt • Eric Cantor • Taxes
soundoff (82 Responses)
  1. Gilbert West

    Eric Cantor, obviously, is a bought-and-paid-for republican working on an agenda thqat has nothing to do with the American People. As a subscriber to BARRON'S I am aware that on January 20, 2009, the day of Obama's inauguration, the National Debt = $10.7 trillion. Add to this figure the $1.3 trillion deficit to Budget-2009, Bush's last budget, and you get a total of $12.0 trillion, not counting the 30 years of interest tacked on to this bill. O.K. We now have an $850 billion stimulus and a $1 trillion "bail-out" under TARP. Probably, we should have had an additional $1 trillion Small Business Loan project to encourage employment. We got what we got. I can't figure out what Eric Cantor and the Republicans are whining about. Did we not enter this "DEPRESSION" on their watch? Under Republican "Tax Cuts?" Or are we, (American people) supposed to be too stupid to realize the Republicans all but buried us economically with this unprecedented National Debt? Obama had to spend something to grease the wheels. All told he spent, maybe $2.4 trillion... but he did put breaks on an economy spiraling down the toilet. He saved us from "Great Depression II," but the callous ingrates like Mr. Cantor would have us believe this is all President Obama's fault! Another thing, I never met a businessman who was cowed by the prospect of paying taxes. President Bush did not intend for his tax cuts to last forever. It was he who put the sun-set date on the Bush tax cuts. Restoring everything to status quo a la the Clinton years is not raising taxes. Republicans have forgotten how to speak truthfully... or perhaps, they never learned.

    July 6, 2011 07:52 pm at 7:52 pm |
  2. ConcernedCitizen

    If the government defaults and the welfare and social security recipients are not paid....what is the GOP plan to address the riots that are likely to ensue?

    July 6, 2011 07:53 pm at 7:53 pm |
  3. doyle

    In negotiating, it doesn't matter how ,"tough" you may be, if you don't strike a deal, YOU HAVE FAILED

    July 6, 2011 07:55 pm at 7:55 pm |
  4. Randy

    Are loopholes illegal thats why they are called loophole? How can the government not close themselves.

    July 6, 2011 07:58 pm at 7:58 pm |
  5. hih

    The tax loopholes have always been the first step as well as the cuts that are on the table. Sadly neither is enough but its a start

    July 6, 2011 08:00 pm at 8:00 pm |
  6. KaayJaay

    Simply put, forget the schools (and their kids/teachers), forget new energy sources (sustain the gas companies wealth), forget the jobs (unless we can control what we pay them and allow people who consider $8 a day great pay take them). Sounds like a great way to run this country in to the ground. Its crazy how as soon as this financial turmoil, years in the making finally hits, the first thing we do is back out of our rights as fathers and mothers to make our daughters and sons better than we were, goes out the window. The ones who will suffer the most are the youth from the bias and money hungry approaches of the majority of those refusing to make common sense decisions in Washington.

    July 6, 2011 08:01 pm at 8:01 pm |
  7. its_all_a_game

    As we all could of predicted, right on schedule, the republicans change their tune... This was all a big political ploy, at the expense of our sanity. Sick of these stupid games, now get on with it!

    July 6, 2011 08:01 pm at 8:01 pm |
  8. Anonymous

    Why does the republican leadership feel that it is necessary to protect the 1% from tax increases. If your rich this is a far better for you than a european tax which is increasing and no europeans seem to complaing about. Of all the world tax systems, the american system is the most aristocracy friendly. Perhaps you need a serf (ecuse me middleclass uprising) to show the necessity of the underclass.

    It's funny that a country that fought for independence from kings, currently has a taxation system that supports them, and a political party (republican) that defends them.

    July 6, 2011 08:01 pm at 8:01 pm |
  9. Epicism

    The gall of today's GOP is appalling. They will now allow the closure of loopholes, but only if we agree to provide tax breaks elsewhere? Tax breaks have failed, and can only perpetuate the problem. I trust most Americans recognize this slight of hand for what it truly is; hypocrisy.

    This proves that their policy of providing breaks to those who need them least at the expense of those who need them most will assure that 2012 will be extremely costly for them. They may be doing right by their wealthy contributors, but we vastly outnumber them.

    July 6, 2011 08:02 pm at 8:02 pm |
  10. Randall

    Why don't we as American taxpayers and the leaders in Washington acknowledge that the most important problem to solve is the reduction/elimination of our federal deficit/debt. Once that is done, then it should be fairly easy to agree that a mix of spending cuts and modest tax increases (excluding any additional tax burden on small businesses) are needed to get this monster under control. However, what I would propose is that any additional tax revenue be earmarked so that it's only used for deficit/debt reduction. I would want an airtight law to enforce this that contains NO loopholes.

    July 6, 2011 08:03 pm at 8:03 pm |
  11. cindy

    Cantor won't said they could talk again?!!!! I wouldn't trust this man any farther than I could throw him. Oh....he must want to see if he can walk out again and double his money from 7% to 14% on that bond that he makes a profit on if the economy tanks

    July 6, 2011 08:03 pm at 8:03 pm |
  12. Former Republican, now an Independent

    This is just a smoke screen. These neo-cons don't want to agree to anything. Their agenda is all about the 2012 election, and so what if it hurts the country or the American people.

    July 6, 2011 08:08 pm at 8:08 pm |
  13. Will

    The problem with the economy can be explained in 3words GOP-Greed Over People.

    July 6, 2011 08:12 pm at 8:12 pm |
  14. Anonymous

    Look at those flip floppers

    July 6, 2011 08:13 pm at 8:13 pm |
  15. Tom

    GOP all about loopholes for the rich.

    July 6, 2011 08:21 pm at 8:21 pm |
  16. GI Joe

    Hey – cut loopholes and subsidies for big corporations, and give more tax breaks to anyone making less than 250,000 per year. Sounds fair to me.

    July 6, 2011 08:22 pm at 8:22 pm |
  17. us1776

    Just more GOP jibberish.

    Cantor, the country can no longer afford the Bush tax-cuts for the wealthy.

    The Bush tax-cut for the wealthy must be repealed.

    .

    July 6, 2011 08:25 pm at 8:25 pm |
  18. Bill

    What's the problem. The repubs say less government. Loopholes and subsidies are all government. The repubs should be jumping at the chance to elimninate them. Right??

    July 6, 2011 08:26 pm at 8:26 pm |
  19. TomFoolery

    The Republicans need to cut this crap out. They shouldn't be eliminating some loopholes, they should be eliminating ALL loopholes, and when I say loopholes, I mean ALL deductions and ALL subsidies. They are corruption pure and simple.

    July 6, 2011 08:26 pm at 8:26 pm |
  20. Nick San Diego

    Geez, just make it simple.. Earn $1 million. Tax rate is 50%
    Thats still lower than it was under Reagan

    July 6, 2011 08:27 pm at 8:27 pm |
  21. realist

    OMG what am I going to do with my 50 million dollar jet now that I don't get a tax break?

    July 6, 2011 08:27 pm at 8:27 pm |
  22. delos

    These guy's are full of it let them cause this default, and explain it to there corperate master on wall street.

    July 6, 2011 08:30 pm at 8:30 pm |
  23. jbs

    GOP...are all “Leeches”

    July 6, 2011 08:32 pm at 8:32 pm |
  24. Bill R in Oakland

    Well now Mr. Cantor, that doesn't really achieve the objective of reducing the deficit, does it? Let's close this loophole over here but offset that with some more tax cuts over here so the net effect is a zero increase in revenues. At least you won't upset your donor/lobbyist base too much.

    Some "compromise"!! These guys claim to speak for the "American people" when polls show 66%+ think it's OK if the rich should pay a bit more.

    July 6, 2011 08:33 pm at 8:33 pm |
  25. Doug

    Here we go, its obfuscation time. You will be able to fill an 19th century Bible with the junk that is going to come out of the debt limit agreement. Prepare to ge robbed. Doug.

    July 6, 2011 08:34 pm at 8:34 pm |
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