WASHINGTON — As the federal government’s deadline for how to handle the debt ceiling looms, Sen. Daniel Inouye says political discord about the issue has already hurt the national economy.

“As we get closer to the deadline, if you were a businessman, you’d get a little nervous, wouldn’t you?” Inouye told Civil Beat in an interview Monday. “When business executives get nervous, they might be reluctant to invest. And if you’re reluctant to invest, that means you won’t be hiring people. You may be firing people.”

President Obama and Senate and House leaders are in a stand-off over how to lift the debt ceiling. They have an Aug. 2 deadline, after which Obama says the country might not be able to pay its bills.

Inouye, who is chairman of the Senate Appropriations committee, is a member of a small bipartisan team looking for ways to reduce the deficit. He had little positive to say about his negotiations with Republicans.

“We tried,” Inouye said. “We came up with, well, painful suggestions. The only condition we set was nothing is final until everything is final.”

But Inouye says the group has not been able to get to that point. Also with Inouye on the panel led by Vice President Joe Biden are House Majority Leader Eric Cantor (R-Va.), Senate Minority Whip Jon Kyl (R-Ariz.), Senate Finance Committee Chairman Max Baucus (D-Mont.), Assistant House Minority Leader Jim Clyburn (D-S.C.) and House Budget Committee member Rep. Chris Van Hollen (D-Md).

“In that group, you had Mr. Cantor, who said, ‘I walk out,'” Inouye said. “And then you had Mr. Kyl. He said, ‘I walk out, too.’ How can we come up with something?”

Inouye dismissed calls for a so-called “balanced-budget amendment,” a condition some Republicans have insisted should be tied to a debt deal.

“I don’t know who’s thinking up those things but they should study a little government and history,” Inouye said, pointing out the extent to which life expectancy has increased since Social Security and Medicare were implemented in the mid-20th century.

The White House said Monday that President Barack Obama would veto the GOP’s “Cut, Cap and Balance” plan, which entails a balanced-budget constitutional amendment.

Inouye has an insider’s view. But the rest of Hawaii’s delegation is, like most others in Congress, wondering what will happen.

Much of Congress has been left “in the dark” about the increasingly tense negotiations, Congresswoman Colleen Hanabusa said.

“Right now, I’m not sure anybody knows who’s on first,” Hanabusa told Civil Beat on Monday. “I don’t think anybody even knows who’s up to bat. We’re up and down on it. I can tell you, on the floor, when we’re there to vote, many of us are asking each other, ‘What have you heard?'”

She and fellow Congresswoman Mazie Hirono have both said they would support a “clean” or “pure” resolution to raise the debt ceiling in order to prevent a federal government default.

“The Republicans have interjected these other issues on which we have very big philosophical differences,” Hirono said.

“When it came out for a ‘pure’ debt ceiling vote, I voted for that,” Hanabusa said, referring to a plan put forth by Vermont Rep. Peter Welch, a Democrat. “I think it should be separate (from other ideological bargaining chips). At that time, that was what the president was saying, too: ‘Let’s keep everything else out.'”

Hanabusa says many of her colleagues on Capitol Hill have expressed surprise about Obama’s willingness to include Social Security and Medicare in a discussion about the debt ceiling.

“The primary comment that I’ve heard is, when he came in, one of the first things that he did was he threw Medicare and Social Security on the table,” Hanabusa said. “Many of my colleagues were, of course, not pleased with that. He had a lot of strings attached and contingencies with that, but I think for most it was like, ‘Why? Why are you doing that?'”

Sen. Daniel Akaka also expressed concern about bundling critical government services with a debate that has no end in sight.

“We cannot guarantee that veterans and Social Security recipients will receive the checks we owe them on Aug. 3 if we fail to reach a compromise,” Akaka said in a speech on the Senate floor Monday afternoon. “If we fail, we will damage our credit rating and worldwide confidence in our financial system.”

Inouye says he expects the government to find a way to prevent a default. But the damage that the debate thus far has caused, he says, is severe.

“I’m certain that the leadership is determined to resolve this by Aug. 2,” Inouye said. “But while we are talking, and the negotiators are negotiating, we are doing this nation harm that will take some time to heal.”

Follow Civil Beat on Facebook and Twitter. You can also sign up for Civil Beat’s free daily newsletter.

About the Author