It was just last week that Vice-President Joe Biden, who has been leading bi-partisan talks on reducing the debt enough to convince House Republicans to raise the debt ceiling, predicted that a deal would be in place by July 4. But negotiations hit a bump today when Republican congressman Eric Cantor pulled out of the group, claiming that the two sides had reached an impasse over taxes and suggesting that it was time for President Obama and Speaker John Boehner to figure it out between themselves. Since the beginning of the negotiations, Democrats have insisted that significant debt reduction can’t happen without some tax increases, while Republicans have insisted with equal adamance that drastic spending cuts alone would suffice.
The Wall Street Journal reports:
“We’ve reached the point where the dynamic needs to change,” Mr. Cantor said. “It is up to the president to come in and talk to the speaker. We’ve reached the end of this phase. Now is the time for these talks to go into abeyance.”
With little more than a month until the federal government reaches the debt ceiling on August 2 and the economy collapses, this isn’t great news. But it may say less about the prospects of a deal than Cantor’s willingness to be part of that deal. As TPM reports:
If tax increases are approved in a final deal, it could be politically beneficial for Cantor to not have his fingerprints on it. Indeed, some observers quickly suggested Cantor has a strong ulterior motive in avoiding elements of the negotiation that sit poorly with the GOP base.
The Washington Post’s Ezra Klein agrees:
For now, we can rule out Cantor.
Update: Arizona senator Jon Kyl has dropped out as well, leaving zero Republicans in the group.