CFR.org Roundup: Debt Fight Shifts to Congress
Senate Majority Leader Harry Reid, left, and Minority Leader Mitch McConnell are working on a debt ceiling fallback plan.
July 19th, 2011
09:35 AM ET

CFR.org Roundup: Debt Fight Shifts to Congress

Editor's Note: The following is reprinted with the permission of the Council on Foreign Relations.

With two weeks until an August 2 deadline that could see the U.S. default on its debt obligations, and talks over a deficit-reduction plan all but dead, congressional leaders (WSJ) in the House of Representatives and the Senate are pushing forward with last-minute, alternative legislative measures.

The House will vote on a "Cap, Cut, and Balance" bill (CNN)Tuesday–legislation that would cut government spending by $2.4 billion over ten years, set strict caps on future spending, and lift the debt ceiling, though only on the condition that Congress pass a constitutional amendment mandating a balanced budget. The legislation is expected to pass the House but not to make it through the Senate.  The White House has indicated that President Barack Obama would veto any such measure.

Meanwhile, the Senate is moving forward with a plan being drafted by Senate Minority Leader Mitch McConnell and Senate Majority Leader Harry Reid that would empower the president to raise the debt ceiling in tranches (WashPost), while only implementing around $1.5 trillion in savings already agreed upon by Republicans and Democrats. The plan would also establish a bipartisan congressional committee to draft a more comprehensive and long-term deficit-reduction plan.

The bipartisan Senate proposal has triggered infighting among the GOP (Politico), and it is still unclear whether House Republicans could ultimately support the McConnell-Reid plan.

Analysis:

McConnell's plan could lead to a "day of reckoning" for Republicans, giving them an opportunity to blame any future fiscal problems on President Obama and the Democrats, says this Reuters analysis.

The Tea Party, which is heavily influencing House Republicans in the debt debate, is promoting a form of constitutional fundamentalism that is very like religious fundamentalism, writes the Financial Times' Gideon Rachman.

With the deadline looming for resolving the U.S. debt standoff, concern is rising among international creditors and markets about the largest economy and home of the world's reserve currency, says this CFR Analysis Brief.

MIDDLE EAST: U.S. Holds Talks with Qaddafi Reps

The United States confirmed that direct talks were held with representatives of embattled Libyan leader Muammar al-Qaddafi in Tripoli over the weekend. At the talks, U.S. diplomats insisted that Qaddafi abdicate power (Guardian) prior to any further discussions, just days after formally recognizing the rebel National Transitional Council as Libya's legitimate government.

The Obama administration's recognition of Libya's National Transitional Council as the country's legitimate government means freeing up funds for the group but also poses legal questions the State Department has to resolve, writes CFR's John B. Bellinger III.

Syria: Diplomatic pressure gathered momentum (al-Jazeera) against Syrian President Bashar al-Assad, as the Arab state of Qatar shut its Damascus embassy and EU officials threatened tougher sanctions.

To receive daily updates in your inbox sign up for CFR.org's Daily News Brief.

PACIFIC RIM: Clashes in China's Xinjiang Province

Activists from the Muslim minority Uighur community (BBC) in China's northwest Xinjiang province attacked a police station in the city of Hotan, killing four and taking others hostage in what Chinese officials called a "terrorist attack." Uighur activists countered that Chinese security forces instigated the violence by opening fire on a peaceful demonstration, killing at least fourteen and arresting seventy.

CFR's John B. Bellinger III and Vijay Padmanabhan, a visiting assistant professor of law at Yeshiva University, examine the legal questions surrounding detention for states engaged in conflicts with non-state groups in this article for the American Journal of International Law.

Philippines: A report by Human Rights Watch accuses Filipino President Benigno Aquino III (al-Jazeera) of failing to investigate and prosecute killings and abuses by the military of political opponents.

SOUTH AND CENTRAL ASIA: Clinton Holds Talks in India

U.S. Secretary of State Hillary Clinton held talks in New Delhi with Indian officials and said the United States is "encouraged" by revived peace talks (TimesofIndia) between India and neighboring Pakistan.

Pakistan: Eight Pakistani employees of a U.S.-based aid agency (ExpressTribune) are missing and feared kidnapped in Pakistan's southwest Balochistan province after distributing food in an Afghan refugee camp.

AFRICA: Somali-American Pleads Guilty to Terror Charges

Somali-American Omer Abdi Mohamed pleaded guilty in U.S. federal court to conspiring to provide material support to Somali militants (CNN) in their attacks against Ethiopian and Somali government troops in late 2007.

Guinea: The Conakry residence of Guinean President Alpha Conde was attacked (Reuters) by rockets and gunfire Tuesday, killing at least one person, just seven months after Conde was elected.

AMERICAS: Mexican Gangs Target Migrants

Central American migrants crossing through Mexico are at risk of being kidnapped by Mexican-organized crime groups (WSJ), with the government rescuing only a fraction of those abducted.

In this CFR Must Read, Southern Pulse applies organizational models to the discussion of organized crime in Mexico, describing its structural similarities to government and its inherent flaws.

EUROPE: Murdochs to Appear Before Parliament

News Corporation CEO Rupert Murdoch and his son James will appear before the UK Parliament (FT) today to answer questions on the widening phone-hacking scandal that continues to engulf Murdoch's media empire, as well as the Metropolitan Police and the government of Prime Minister David Cameron.

Eurozone: The leaders of the seventeen eurozone states, along with European central bankers and commissioners, will meet in Brussels Thursday for an emergency summit (Guardian) on the ballooning eurozone sovereign debt crisis, in an effort to hash out a second rescue plan for Greece.

The eurozone, once seen as a crowning achievement in the decades-long path of European integration, is a buffeted by a sovereign debt crisis of nations whose membership in the currency union has been poorly policed, says this CFR Backgrounder.

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    July 19, 2011 at 10:14 am | Reply
  6. Fred

    You sucks, what kind of jornalist but a notice without try to found out about the little team from São Paulo.....asswhole!

    July 19, 2011 at 11:01 am | Reply
  7. FIFA

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    July 19, 2011 at 11:16 am | Reply
  8. Gabriel

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    July 19, 2011 at 1:22 pm | Reply
  9. Jsmith

    So we may get $1.5T in debt reduction for our $14T debt, and more promises (i.e., smoke and promises) of future debt reduction. If this is the best the Senate can do, we need a new Senate. It's also obvious that "tax reform" means tax increases, something 80% of the country opposes. One of these morons is my Senator, and I plan to vote against him. Meanwhile, S&P et al will almost certainly consider us in default our economy will be, rightfully, right there will Greece and Portugal. It will be a sad day when BHO signs this monstrosity.

    July 19, 2011 at 2:13 pm | Reply
  10. j. von hettlingen

    "Clashes in China's Xinjiang Province". Some Uighurs of the Muslim minority in China's northwest Xinjiang province attacked a police station in the city of Hotan. The outposts in China don't benefit from the boom in the urban areas.

    July 19, 2011 at 5:48 pm | Reply
  11. j. von hettlingen

    "The Arab state of Qatar shut its Damascus embassy". It's noteworthy that Qatar always wants to play the pioneering role in the international community.

    July 20, 2011 at 8:33 am | Reply

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