With the collapse of the Boehner-Obama talks, it looks as if something closer to “regular order” in the legislative branch will probably be needed to produce the final deal to raise the debt limit. The House is moving toward taking up a plan drafted by the speaker and his lieutenants, and Senate majority leader Harry Reid is drafting a competing version for his chamber.
This is a good development. Because it’s been clear for some time now that President Obama has been the real roadblock.
The president and his advisers wanted to take what looked on its surface like a potential problem for them — the need to raise the debt limit — and turn it into an opportunity. They have had three primary objectives in this fight. First, the president has wanted to force congressional Republicans to agree to a large tax hike. Such a hike would partially mask the government’s spending problem for a time (though not permanently), and thus ease the pressure for spending cuts. It would also badly divide the conservative coalition going into an election year. In other words, it would be a real “twofer” for the president and his party and would certainly be trumpeted as such by the mainstream press.
Second, the president has wanted to further advance the Obamacare vision for health care. That has meant no meaningful move toward repeal and replace, and in fact further changes in Medicare and Medicaid that are in the spirit of Obamacare’s central-planning philosophy.
The president’s third objective has been to reposition himself politically. His first two years in office were dominated by the so-called “stimulus” proposal and Obamacare — efforts that cemented the electorate’s perception of him as a big-spending, big-government liberal. Heading into 2012, the president and his advisers desperately want to change his image, especially among independent voters, and they were hoping that a “$4 trillion” deficit-cutting plan would do the trick.
Unfortunately for the president, as the details of his talks with Speaker Boehner have spilled out into the press, it hasn’t helped him shed his well-earned reputation as a big spender. The dominant story line that has emerged is that the president has insisted on a $1.2 trillion tax hike to get a deal, and Republicans have said no, especially given the president’s insistence that a serious rewrite of the health-care entitlements, including Obamacare, is “off the table.” By holding firm, Republicans have — so far — denied the president the ability to shift political blame onto them for the tax hikes he wants to impose on working Americans. Consequently, as matters stand today, the debt-limit talks have only further exposed the president as a big-government liberal.
So Republicans have acquitted themselves remarkably well to date. The question is, what should they do now?
First, House Republicans must realize that, at this stage, they have to pass a credible plan through their chamber. Having rejected the Obama “grand bargain,” they need to show the country they are willing to pass a debt-limit increase on reasonable terms to avoid the real, if sometimes exaggerated, risks associated with a debt-limit crisis. The two-step process that Speaker Boehner outlined to his colleagues today looks like it should do the trick in that regard. It would impose discretionary spending caps for a decade, thus producing real restraint on domestic appropriations. The savings — about $1.2 trillion over ten years — would be accompanied by a substantial and immediate increase in the debt limit.
In addition, the Boehner plan would empower a special bipartisan joint committee of House and Senate members to draft further budget-cutting reforms, including entitlement changes. The target would be an additional $1.8 trillion in deficit reduction over ten years. The recommendations of this committee would go to an up-or-down vote in both the House and the Senate, probably sometime in early 2012.
Senator Reid and his Democratic colleagues are objecting to the Boehner plan on the grounds that it would force another debt-limit showdown in 2012, almost certainly with the same disputes about taxes and entitlements. Fair enough. House and Senate Republicans should be open to a reasonable counter-offer from Senator Reid, especially if it is an offer that could actually pass in the Senate.
The details of course matter immensely here. The legislation to raise the debt limit needs to include real spending restraint, not gimmicks or smoke and mirrors. But if the cuts in a Reid counter-offer are real, and if they are of a size to comfortably allow an even larger bump up in the debt limit, Republicans should be open to moving in that direction if doing so would produce a final deal with Senate Democrats.
Because, from a strategic point of view, even a resolution of the kind Reid is pursuing — one giving the president a debt-limit hike into 2013 — would give Republicans all they need from this fight, if the spending cuts are indeed real and not focused on defense. There would be no “grand bargain” for the president, and no “Gang of Six” plan. There would be sizeable, even historic spending cuts, with no accompanying tax increase. There would be no tacit approval of Obamacare. And there would be no political fallout from the unpredictable economic turmoil that could accompany a hiatus in federal borrowing.
It’s true that such a deal would also mean giving up on entitlement reform before 2013. But, given what’s happened over the past two months, it’s obvious that genuine entitlement reform isn’t going to happen with this president in the Oval Office.
Republicans have successfully dodged several bullets to this point. It’s now time for them to see that they are in a good position to close a deal on their terms — and then move on.
— James C. Capretta was an associate director at the Office of Management and Budget from 2001 to 2004.
The linked article said that Reid and Schumer cited potential downgrades with only a short term deal. They fail to mention that phase 1 of Boehner's proposal accomplishes almost everything their bill accomplishes on the spending side. Reid's headline number is $2.7 trillion, which includes $1.2 trillion from troop reductions in Iraq and Afghanistan. Boehner's phase 1 includes $1.2 trillion in spending cuts. Add the same reduction in expenses related to the M.E. and Boehner's plan represents $2.4 trillion.
Republicans need to make that clear so that voters understand exactly who is responsible for any potential downgrades. If Boehner included the war "savings" in his plan as the Democrats have done, his proposal is in the neighborhood of the "grad bargain" at close to $4 trillion. If you add the $800 million in increased revenues the Boehner was prepared to accept, his plan is over $4 trillion.
Republicans don't need to take any more teeth out of the bill, provided they can get it through the house.
Reply to this commentLinkReport Abuse"So Republicans have acquitted themselves remarkably well to date."
Well stated Mr. Capretta.
The irony is, many who are paid for analysis all provided endless "Republicans are losing" conceptions. Even the big Celebrity Conservative Pundits were going overboard, screaming in a regretful emotive fashion crying about 'capitulation'.
In reality, the Republicans in Congress have done well, and we all should be thankful for their offering. Nothing will be perfect.
Obama has shown, as a perfect symbol for the Democratic Party, pure incompetence, fraud, deceit, sophistry, and a misguided - dysfunctional political embrace of destructive leftist policies.
We cannot achieve great things yet, until he is removed, and until we gain a serious Majority in the Senate.
2012 is essential.
Reply to this commentLinkReport Abuse"So Republicans have acquitted themselves remarkably well to date."
Well stated Mr. Capretta.
2012 is essential.
That is the bottome line for Republicans "2012"... It's not about what's best for the country at this point, it's about what THEY THINK can make Obama look bad, therefore let's try and do a replay early next year in the middle of an election cycle... As an Independent that is backing Obama... I LOVE IT...
It's simple: Republicans beleive that raising taxes on rich, (I'm sorry job creators) will cost American jobs, so in reverse cutting taxes will help America create jobs... Is that right so far??? Well, we have cut taxes for the last 10 years, remember 2001 Bush Cuts & 2003 and 2010 Obama cuts... But still no jobs... People will start to call them out on this... WHERE ARE THE JOBS THAT THE TAX CUTS WERE SUPPOSE TO CREATE???
Reply to this commentLinkReport AbuseThere were no "Obama tax cuts" in 2010. There were one-time reductions, which their recipients treated exactly as they would any one-time windfall: they used them to pay down debt (no stimulus to future growth there!), saved them against future expenses (stimulus effect, ditto) or used them to offset higher cost essential purchases, like gas (stimulus effect, 0.00). People are willing to invest, hire and consume more when they are reasonably confident that their future income will support that choice. That's why we need to change tax rates especially for businesses and investment returns, on a reasonably permanent basis, rather than rely on politically expediant one-off and untargeted general handouts.
Reply to this commentLinkReport AbuseEagerly awaiting Eric's standard "Republicans are just about to cave" post in 5 ... 4 ... 3 ... 2 ...
Reply to this commentLinkReport AbuseRepublicans have acquitted themselves 1 well...now they just have to pass a bill. That's what all the analysis on the corner has been, working on the assumption that Boehner can pass a bill--I don't think he can. There's no evidence that he has the votes and then all this analysis on how clever they have been will collapse, along with Republican electoral fortunes. The pressure needs to be raised, if the Republicans fail to pass a bill, it will be a disaster.
Reply to this commentLinkReport AbuseCall me crazy but how does 1.2 trillion dollars in cuts over 10 years mean anything when THIS YEAR ALONE we will be 1.5 trillion in the hole? Further, why should anyone believe that another "blue-ribbon commission" will do anything to cut spending when they have never done so before? I would love someone to give me an answer.
Reply to this commentLinkReport AbuseCongress used to have a serious problem with closing unneeded military bases, and turned the problem over to a special commission which independently produced a list of bases to close. Congress was then required to vote on the entire list as a whole, without amendment permitted, on a straight yes-no vote. No filibuster, no cherry-picking, no refer-to-committee. The list was accepted and the bases were closed, despite teeth-gnashing and wailing. I think this may be a good model for the current situation. Does this answer your question?
Reply to this commentLinkReport AbuseThey are the same plan. All Boehner adds is the committee tasked with proposing $1.8Tr in savings sometime next year. But Congress needs to find more than that in savings sometime in the next
_month_. That's going to happen anyway (because the market demands it) so the Republicans can throw this committee into their plan for free--they get good press without having to commit to anything, because the real work will come after Aug. 2, when Congress has to figure out how to cut another $2.8Tr in debt immediately, not next year.
True that this committee is not a budgetary gimmick, but it is a political gimmick.
I think the House R's totally blew it. The Reid plan will win, and they will get zero credit for it. Thanks to Senate Dems (!) The voters get $1.2Tr in real savings, with no tax increases, and twice that in extra future debt. The WH (and the Dems) will get all--and I mean all--the credit for saving the country. The House R's are at best junior partners here, and rather small partners at that. I find this kind of an amazing failure.
Senate Dems will happily vote down the current Boehner plan, and then all there will be is the Senate plan, and the House will have no reason to turn it down--none whatsoever. Game over. (Until Aug. 3, that is.)
Reply to this commentLinkReport AbuseI have seen even real, scummy, died-in-the-wool democrats ditancing themselves from the psychotic-in-chief.
Reply to this commentLinkReport AbuseI wonder if someone in the NRO orbit, well versed in historical psychology, can tell us who the last President who cracked up in office was.
He's got company.
Just to be clear, there are no actual spending cuts (as in, reductions in spending) proposed in any of these deals. These are Washington 'spending cuts' (scare quotes required). They're talking about INCREASING spending, but at a slower rate than the currently proposed spending increases. These 'cuts' take place over 10 years, and of course, most of the savings are at the tail end of that time period (typically, in such deals, subsequent budgets render the agreed 'cuts' null and void).
Even if the 'cuts' were real cuts, we're talking about an average of about 100 billion a year over a decade against ANNUAL deficits that are running at around 1.6 TRILLION.
Obama loves his car analogies. Here's one: Just imagine yourself in the backseat of the car in Thelma and Louise, but with Obama driving, heading straight towards the Grand Canyon. He's got the gas pedal firmly planted all the way to the floor and a firm grip on the steering wheel. You've got one of those little umbrellas they put in girlie drinks at bars. This 'spending cut' deal is the equivalent of holding the little umbrella out the window as if it were a parachute.
Reply to this commentLinkReport AbuseThe two-part plan is undesirable - to everyone but those whose main goal is to make Obama look bad. The public is weary of this brinksmanship and the Boehner plan will never pass the Senate.
Reply to this commentLinkReport AbuseBoehner's two step plan is the only sane approach if the alternative is Obama's phony " grand bargain" that includes tax increases he could not get passed by the Democratic controlled Senate. Boehner had already agreed to 800 billion in revenue enhancements when Obama- spooked by dissent from his left wing base- upped the anty by demanding an additional 400 billion in new taxes. Boehner would have been a fool to accept this and he has shown that he is a statesman but no fool.
Reply to this commentLinkReport AbuseBut EVERY plan is a two part plan, No matter how high they raise the debt ceiling plan now, it will be reached soon and we will have to go through this over and over, etc. The only possibility to avoid broaching the next debt ceiling is to have expenditure less than revenue, and Congress has shown that the only way that they will do this is to have a Balanced Budget enforced by the Constitution.
Reply to this commentLinkReport AbuseAll of the criticisms of the spending reduction plans focus on their potential "phony" nature. For example: the cuts still result in increased spending just less of it; the cuts involve reductions in spending that would have occured anyway;most of the cuts are in the out years;etc.
However, there is one huge point that is missed about all of these 10 year plans. This Congress and Preseident have absolutely no legal authority to bind a future Congress. In other words, Congress in 2011 can't tell the Congress of 2015 what to spend or not spend. Any cuts beyond the current Congress are completely phony.
Reply to this commentLinkReport AbuseWhy isn't anyone mentioning that taxes are already going up big in 2013 under current law? $3 trillion according to CBO scoring. I guess neither party really wants to see that tax increase happen so they aren't staking any claims on it.
Reply to this commentLinkReport AbuseI can not believe what I just read. Ignorance is no longer an excuse. I am a college professor who has long supported a two or more party system. I am now coming to believe that this country would be far better off without the republican party. I can not even force myself to capitalize republican. There is no question that the republicans have brought us to this crisis and there is no question that it is purely political. At least they did not lie about that. They said they one goal was to make O'Bama a one term president and they do not care who gets hurt o ensure that. The President a Democrat, offers an 83% cut to 17% revenue increase, with the revenue increase to come from the wealthy and the republican party say he us unwilling to compromise. That is like having two parties 5 miles apart and the first person offers to walk 4 + miles and the other party will not walk a partial mile. They expect the first person to walk the whole five miles and want to call that compromise. The republicans only control one house of the Congress and they do not control the executive office, but seem to think that only their constituants matter. The republicans lack an understanding of American ideals and have no Christian morals!
Reply to this commentLinkReport AbuseAdmittedly, I was not all that bright of a light bulb in academia. Having said that, having admitted that (in humility, a trait some of us have), I got lucky to just somehow manage coming out of our public school system with enough knowledge to know be fully aware that we have the wrong people teaching our students. We really do. That is what I have learned. That is what I believe. Nothing this professor has on me. Nothing. And too many like him. Ya just got to wonder how many students the "drb's" have indoctinated the diatribe such as in his post below. I mean...if you have kids in the public school system....GET THEM OUT NOW!! GEEESH.
Reply to this commentLinkReport AbuseThe fact you felt obligated to credential yourself as a college professor says a lot. Realize the Federal Government has bumped it's spending up from about 20% of GDP to 25%. Those are the real numbers that matter professor. And as a Christian, I find the Republican position very moral as it is designed to preserve posterity as opposed to redistributing the wealth at the cost of wealth creation. Not sure what kind of professor you are, but it's clear you don't understand that the greater the burden of government is on the private economy the less the private economy produces. The opposing limit would be the more anarachy the less the private economy can produce. In other words there is a balance of government that is best, history shows us that balance is with a government that runs at about 18% of GDP...perhaps you need to take some history classes professor...
Reply to this commentLinkReport AbuseGet your head out of your ivory tower sand and learn the facts. Try reading EVERY article in RealClearPolitics for two weeks, and you'll see things in a new light.
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