News

Federal debt issue still at impasse

Congressional leaders and the White House seem to be going in separate directions on the debt issue. The two branches of government are running out of days to come to an agreement before the government defaults for the first time ever.

House Speaker John Boehner’s two-step plan includes increasing the debt limit and capping spending the next couple of years, which could save more than $1 trillion in the next decade. The second step includes creating a congressional commission to propose further cuts.

Meanwhile, Reid’s plan raises the debt limit through 2012 by $2.5 trillion with no entitlement cuts. The debt ceiling in Boehner’s plan may not be high enough to get through the Senate, while Reid’s plan most likely won’t get through the House. The deadline to get something done is August 2nd, otherwise investors could avoid American bonds and securities, driving up interest rates and impacting economic recovery.

The NAFB News Service contributed to this article.