US debt ceiling inorder taxes

Republicans shouldn't fear concessions in return for major spending reforms, and the stand-off may just be typical last-ditch theatrics.

But both parties should suffer if Congress misses Treasury's deadline.

Republicans walked out of US budget talks on June 23, setting up a showdown between President Barack Obama and House Speaker John Boehner over how to raise the limit on federal borrowing and avoid a looming debt default.

Vice President Joe Biden and a handful of lawmakers had been working on a budget-cutting deal that would allow Congress to sign off on continued borrowing, but Republicans quit unexpectedly, saying the group had reached an impasse over tax increases sought by Democrats.

An agreement on the budget would give lawmakers political cover to raise the $14.3 trillion debt ceiling before Aug. 2, when the Treasury has said it will run out of money to pay the country's bills.

COPYRIGHT REUTERS, 2011