Republicans say Obama must “step up” on deficit

By Deborah Charles

WASHINGTON (Reuters) – Top Republicans on Friday said an increase in the jobless rate underscored the need for President Barack Obama to get personally involved in talks to cut government spending to help stimulate economic growth.

“One look at the jobs report should show the White House it’s time to get serious about cutting spending and dealing with our ailing economy,” House Speaker John Boehner said after data showed jobs growth slowed sharply in May and the jobless rate rose to 9.1 percent.

Boehner said Obama needed to take a more active role in deficit-reduction talks if the president hopes for agreement between Republicans and Democrats by the end of June.

The White House may have gotten that message. Obama invited Boehner for a round of golf on June 18, an administration official said.

Tension between the two political sides led Moody’s credit ratings agency to warn on Thursday that it could consider cutting the United States’ top-notch credit rating if there was not progress by mid-July on a deal to reduce the deficit and raise the $14.3 trillion U.S. debt limit.

Obama is trying to win congressional approval to raise the borrowing authority before an August 2 deadline. But comments by Republican and Democratic lawmakers on Friday did not augur well for any quick deal as both sides blamed each other for the sagging economy.

Both sides have been careful, however, to try to keep their heated rhetoric from seeping into bipartisan talks led by Vice President Joe Biden, which are seen by many as the best hope for a deficit-reduction deal. Opinion polls show Americans are deeply worried about the size of the U.S. deficit, which is expected to reach $1.4 trillion this year.

“I think there’s a lot of progress that’s been made in the Biden talks,” Boehner said.


“He (Obama) could take a more active role. He’s had this hands-off approach for the last several months while this conversation has raged on,” Boehner said, sharpening his criticism of the president’s handling of the issue.

“If we’re going to meet the president’s goal of trying to get this done by the end of June, then it’s time for him to step up and take a more active role.”

The White House has said Obama, who directed Biden to lead the talks, has been closely monitoring the negotiations.

An official said on Friday that the White House would delay the release of its mid-session budget review — a report with updated budget and economic forecasts — until after the legal deadline of July 16, partly because of the ongoing talks and the late deal on a fiscal 2011 budget earlier this year.

“These delays have little practical effect,” the official said, adding that the report would come out “later in the summer.” [ID:nN03175514]

Republicans say publicly and Democrats privately that the Biden talks are not moving fast enough and that negotiators need to meet more often to resolve thorny issues in the way of a deficit deal to calm financial markets.

House Majority Leader Eric Cantor said the Biden talks had produced movement toward “coalescing around trillions of dollars in cuts.”

But Cantor, one of two Republicans taking part in the talks, made clear Republicans would stand firm on their positions and want tax increases off the table as a deficit-reduction option.

The Biden talks have been slow-going. While Republicans refuse to consider tax hikes, Democrats oppose Republican proposals to scale back the government-run Medicare healthcare program for future retirees.

The next round of talks, which include a group of six members of the House and Senate, will resume on June 9.

Obama met with about 200 House Republicans at the White House earlier this week.

In a 75-minute meeting described by some as frank with some tense moments, Obama warned Republicans of “dire” consequences if they do not raise the debt limit before the government runs out of funds. But Republicans, and many Democrats, insist that significant spending cuts must accompany any deal on raising the debt limit.

(Additional reporting by Jeff Mason, Thomas Ferraro and Donna Smith; Editing by Ross Colvin and David Lawder)