Debt Ceiling: What Killed The Deal And What Might Make One Happen This Week
There are a lot of good articles running through what happened between Thursday night, when a deal seemed likely, and Friday evening, when the talks fell apart. New reports suggest that Boehner is trying to prepare a deal by tomorrow evening, to prevent the markets from dropping Monday. So here’s the short version of what just happened, and where we’re likely to be going:
On Tuesday, the Gang of Six proposed a deal that would raise tax revenues by $2 trillion — which showed there was support among Senate Republicans for a deal that raised taxes by about $2 trillion. On Thursday, congressional Democrats rebelled over reports that the deal Boehner and Obama were negotiating had only $800 billion in new revenue, and it wasn’t even clear how those would be achieved. That night, Obama called Boehner looking for about $400 billion more in revenue to have something he could sell to Democrats. That would have brought the deal from $800 billion in revenue to $1.2 trillion in revenue. He didn’t get a call back until the next day at 5:30 p.m. — by which point the call was unnecessary. Boehner had already told the media that he was leaving the talks.
Republicans are emphasizing that the White House went from asking for $800 billion in revenue to $1.2 trillion. The word you’re hearing from them is “reneged,” but the White House emphasizes that negotiations were ongoing, and both sides were asking for more as they tried to figure out what they could both agree on and pass through Congress. Boehner, for instance, wanted further cuts to Medicaid, a trigger that would repeal the individual mandate and the Independent Payment Advisory Board if the entitlement cuts didn’t come through, and a tighter cap on discretionary spending. “They make it seem like the president made some ultimatum on $1.2 trillion in revenue,” says a senior administration official. “He didn’t. He said, ‘If you can’t do this, let’s figure out what we can do.’ ”
The “what we can do” would probably have been to ratchet back the entitlement cuts. Or maybe another solution would have been found. It’s hard to say because Boehner didn’t come back with a counteroffer. He simply left the negotiations.
But let’s zoom out on where the negotiations left off. Spending cuts would have totaled about $3 trillion, with a bit less than a trillion dollars of that coming from entitlements and other forms of mandatory spending. Revenue increases — none of which would have come from raising marginal tax rates — would have been between $800 billion and $1.2 trillion. The package would have extended the unemployment insurance and payroll tax cut provisions passed in the 2010 tax deal. All in all, that’s about a trillion dollars less in revenues than the Simpson-Bowles/Gang of Six deals advocated, and about $2.6 trillion less in revenue than simply letting the Bush tax cuts expire in 2012.
There’s a question as to whether this was the very best deal Republicans could get or simply close to it. But it’s hard to believe that it was so bad that it ended the talks. What seems likelier is that Boehner spent some time between Thursday and Friday talking to his members and found that his party simply didn’t support a deal with the White House. For one thing, a deal would include some amount of revenue, and that was a hard sell under any circumstances. For another, letting the president look like a dealmaker would potentially dim the GOP’s chances of retaking the White House in 2012. As my colleague George Will put it Thursday, a deal “would enable President Obama to run away from his record and run as a debt-reducing centrist.”
And so Boehner walked. Fundamentally, this looks like the same calculation that ended the last round of talks over a 4 trillion deal. What’s different this time is Boehner’s plan B: The Speaker of the House appears to believe that a deal struck between congressional leadership would perhaps be easier to sell to his members. Since it’s hard to see Nancy Pelosi and Harry Reid making deeper concessions than Obama did, it’s hard to see why that would be true, save that the deal might not look like such a victory for the White House.
Perhaps taking the benefit for Obama off the table will be enough. I’m doubtful. It’s more likely that what we’re really doing now is wasting time until the markets plummet and Boehner’s members decide that a deal is better than no deal. And there’s a very good chance that the first major show of market concern could come tomorrow night, when the Asian markets open. Boehner is hoping to present a plan by then, but a plan is very different from a deal. A plan is something politicians can come up with. A deal, we’re increasingly finding, is something that we need the markets to force.
By: Ezra Klein, Columnist, The Washington Post, July 23, 2011
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GOP Leaders Must Free Themselves From The Tea Party’s Grip
Media reports are touting the Senate’s Gang of Six and its new budget outline. But the news that explains why the nation is caught in this debt-ceiling fiasco is the gang warfare inside the Republican Party. We are witnessing the disintegration of Tea Party Republicanism.
The Tea Party’s followers have endangered the nation’s credit rating and the GOP by pushing both House Speaker John Boehner and Majority Leader Eric Cantor away from their own best instincts.
Cantor worked amicably with the negotiating group organized by Vice President Joe Biden and won praise for his focus even from liberal staffers who have no use for his politics.
Yet when the Biden group seemed close to a deal, it was shot down by the Tea Party’s champions. Boehner left Cantor exposed as the frontman in the Biden talks and did little to rescue him.
Then it was Boehner’s turn on the firing line. He came near a bigger budget deal with President Obama, but the same right-wing rejectionists blew this up, too. Cantor evened the score by serving as a spokesman for Republicans opposed to any tax increase of any kind.
Think about the underlying dynamic here. The evidence suggests that both Boehner and Cantor understand the peril of the game their Republican colleagues are playing. They know we are closer than we think to having the credit rating of the United States downgraded. This may happen before Aug. 2, the date everyone is using as the deadline for action.
Unfortunately, neither of the two House leaders seems in a position to tell the obstreperous right that it is flatly and dangerously wrong when it claims that default is of little consequence. Rarely has a congressional leadership seemed so powerless.
Compare the impasse Boehner and Cantor are in with the aggressive maneuvering of Senate Republican Leader Mitch McConnell. He knows how damaging default would be and is working with Senate Majority Leader Harry Reid to concoct a way out.
McConnell can do this because he doesn’t confront the Tea Party problem that so bedevils Boehner and Cantor. Many of the Tea Party’s Senate candidates — Sharron Angle in Nevada, Christine O’Donnell in Delaware and Joe Miller in Alaska — lost in 2010. Boehner and Cantor, by contrast, owe their majority in part to Tea Party supporters. McConnell has a certain freedom to govern that his House leadership colleagues do not.
And this is why Republicans are going to have to shake themselves loose from the Tea Party. Quite simply, the Tea Party’s legions are not interested in governing, at least as governing is normally understood in a democracy with separated powers. They believe that because the Republicans won one house of Congress in one election, they have a mandate to do whatever the right wing wants. A Democratic president and Senate are dismissed as irrelevant nuisances, although they were elected, too.
The Tea Party lives in an intellectual bubble where the answers to every problem lie in books by F.A. Hayek, Glenn Beck or Ayn Rand. Rand’s anti-government writings, regarded by her followers as modern-day scripture — Rand, an atheist, would have bridled at that comparison — are particularly instructive.
When the hero of Rand’s breakthrough novel, “The Fountainhead,” doesn’t get what he wants, he blows up a building. Rand’s followers see that as gallant. So perhaps it shouldn’t surprise us that blowing up our government doesn’t seem to be a big deal to some of the new radical individualists in our House of Representatives.
Our country is on the edge. Our capital looks like a lunatic asylum to many of our own citizens and much of the world. We need to act now to restore certainty by extending the debt ceiling through the end of this Congress.
Boehner and Cantor don’t have time to stretch things out to appease their unappeasable members, and they should settle their issues with each other later. Nor do we have time to work through the ideas from the Gang of Six. The Gang has come forward too late with too little detail. Their suggestions should be debated seriously, not rushed through.
Republicans need to decide whether they want to be responsible conservatives or whether they will let the Tea Party destroy the House That Lincoln Built in a glorious explosion. Such pyrotechnics may look great to some people on the pages of a novel or in a movie, but they’re rather unpleasant when experienced in real life.
By: E. J. Dionne, Opinion Writer, The Washington Post, July 20, 2011
Questions About Michele Bachmann’s Migraines Aren’t Sexist
Questions about whether Michele Bachmann’s headaches should disqualify her for office may be of dubious validity, but are they sexist? I don’t think so.
In case you’ve missed the media storm du jour, the Daily Caller reported Monday night that Bachmann suffers from incapacitating migraines, and engages in “heavy pill use” to combat them. This has spurred, among other things, cries of sexism.
Fox News Channel host Martha MacCallum, for example, said that “it does feel sexist … Has anyone asked this of the male candidates out there? Do you have any medical issues that you think we should know about?” (As a side note, asking candidates such questions about medical issues is, I think, fairly routine and legitimate.)
Monica Crowley, a conservative talk show host appearing with MacCallum, chimed in, “This does smack of that old school ‘Woman As Hysteric’ kind of thing.”
Well not so fast. Here’s what the Caller reported:
The Minnesota Republican frequently suffers from stress-induced medical episodes that she has characterized as severe headaches. These episodes, say witnesses, occur once a week on average and can “incapacitate” her for days at time.’
Here’s a simple sexism test. Replace reference to Bachmann with references to, say, Mitt Romney. Would a story saying that Romney “frequently suffers from stress-induced medical episodes” that “incapacitate” him for “days at a time” get the same attention? I should think so.
Now, does that mean that the Caller story has merit? That’s trickier. It’s legitimate … if it’s legitimate. In other words if she really is “frequently … incapacitated” for days at a time then, yes, that’s a legitimate line of inquiry. But if it’s a case of occasional migraines getting blown out of proportion by anonymous, embittered former staffers, that’s something else entirely.
Then there are the pills. “The migraines are so bad and so intense, she carries and takes all sorts of pills,” a source tells the Caller. “Prevention pills. Pills during the migraine. Pills after the migraine, to keep them under control. She has to take these pills wherever she goes.”
Well. “Pills” could be anything from aspirins to greenies. Lots of people take pills on a regular basis—taking pills is not in and of itself disqualifying or even troubling. If there were any evidence to suggest that these pills could affect her judgment that would be a different question, but the Caller story doesn’t have it.
One final issue here that the Washington Post’s Chris Cillizza notes, that this isn’t the first time former Bachmann aides have badmouthed her to the press:
A cavalcade of disgruntled former aides (are there ever “gruntled” former aides?) willing to go public with questions and criticisms of Bachmann is decidedly problematic for her presidential candidacy.
After all, if those who know (or knew) her best lack faith in her ability to do the job effectively, it will almost certainly force voters to re-examine their first, generally positive impressions of her.
Indeed, with friends like that, who needs migraines?
By: Robert Schlesinger, U. S. News and World Report, July 20, 2011
Bandits, Blowhards And Showhorses: The GOP’s Road Not Taken
Over the past months, Republicans enjoyed enormous advantages. Opinion polls showed that voters are eager to reduce the federal debt, and they want to do it mostly but not entirely through spending cuts.
There was a Democratic president eager to move to the center. He floated certain ideas that would be normally unheard of from a Democrat. According to widespread reports, White House officials talked about raising the Medicare eligibility age, cutting Social Security by changing the inflation index, freezing domestic discretionary spending and offering to pre-empt the end of the Bush tax cuts in exchange for a broad tax-reform process.
The Democratic offers were slippery, and President Barack Obama didn’t put them in writing. But John Boehner, the House speaker, thought they were serious. The liberal activists thought they were alarmingly serious. I can tell you from my reporting that White House officials took them seriously.
The combined effect would have been to reduce the size of government by $3 trillion over a decade. That’s a number roughly three times larger than the cost of the Obama health care law. It also would have brutally fractured the Democratic Party.
But the Republican Party decided not to pursue this deal or even seriously consider it. Instead, what happened was this: Conservatives told themselves how steadfast they were being for a few weeks. Then morale crumbled.
This week, Republicans probably will pass a balanced budget constitutional amendment that has zero chance of becoming law. Then they may end up clinging to a no mas Senate compromise. This proposal would pocket cuts that have already been agreed on, and it would eliminate leverage for future cuts and make them less likely.
It could be that this has been a glorious moment in Republican history. It could be that having convinced independents that they are a prudent party, Republicans will sweep the next election. Controlling the White House and Congress, perhaps they will have the guts to cut Medicare unilaterally, reform the welfare state and herald in an era of conservative greatness.
But it’s much more likely that Republicans will come to regret this missed opportunity. So let us pause to identify the people who decided not to seize the chance to usher in the largest cut in the size of government in U.S. history. They fall into a few categories:
The Beltway Bandits
American conservatism now has a rich network of Washington interest groups adept at arousing elderly donors and attracting rich lobbying contracts. For example, Grover Norquist of Americans for Tax Reform has been instrumental in every recent GOP setback. He was a Newt Gingrich strategist in the 1990s, a major Jack Abramoff companion in the 2000s and he enforced the no-compromise orthodoxy that binds the party today.
Norquist is the Zelig of Republican catastrophe. His method is always the same. He enforces rigid ultimatums that make governance, or even thinking, impossible.
The Big Government Blowhards
The talk-radio jocks are not in the business of promoting conservative governance. They are in the business of building an audience by stroking the pleasure centers of their listeners.
They mostly give pseudo Crispin’s Day speeches to battalions of the like-minded from the safety of the conservative ghetto. To keep audience share, they need to portray politics as a cataclysmic, Manichaean struggle. A series of compromises that steadily advance conservative aims would muddy their story lines and be death to their ratings.
The Show Horses
Republicans now have a group of political celebrities who are marvelously uninterested in actually producing results. Sarah Palin and Michele Bachmann produce tweets, not laws. They have created a climate in which purity is prized over practicality.
The Permanent Campaigners
For many legislators, the purpose of being in Congress is not to pass laws. It’s to create clear contrasts you can take into the next election campaign. It’s not to take responsibility for the state of the country and make it better. It’s to pass responsibility onto the other party and force them to take as many difficult votes as possible.
All of these groups share the same mentality. They do not see politics as the art of the possible. They do not believe in seizing opportunities to make steady, messy progress toward conservative goals. They believe that politics is a cataclysmic struggle. They believe that if they can remain pure in their faith then someday their party will win a total and permanent victory over its foes. They believe they are Gods of the New Dawn.
Fortunately, there are still practical conservatives in the GOP, who believe in results, who believe in intelligent compromise. If people someday decide the events of the past weeks have been a debacle, then practical conservatives may regain control.
By: David Brooks, Columnist, The New York Times, July 19, 2011
The Missing Word: News “Corp” vs It’s Critics
Today’s Wall Street Journal editorial has the title “News and its Critics”—obviously, it’s missing a word. The piece’s real title should be “News Corp and its Critics,” or even better, “News Corp vs. its Critics.” It’s a piece by News Corp, for News Corp. The problem is, the ugly 1044-word attack on the company’s “competitor-critics” alternates between catty defensiveness, a drunk beat poet, and utter incomprehensibility. One can only stand in awe of a conglomerate that would mass print an “aw-shucks” apology across one country while sending the Journal to do its dirty work in another. Some of the editorial’s phrases are almost self-parodying:
The overnight turn toward righteous independence recalls an eternal truth: Never trust a politician.
The Schadenfreude is so thick you can’t cut it with a chainsaw.
Especially redolent are lectures about journalistic standards from publications that give Julian Assange and WikiLeaks their moral imprimatur.
But, beyond redolence, imprimaturs, chainsaws, and Schadenfreude, the editorial’s argument—insofar as one is discernible—is so dishonest that it has the opposite of its intended effect. You come out of the piece trusting News Corp and the Journal far less than you might have before.
The first “point”:
Phone-hacking is illegal, and it is up to British authorities to enforce their laws. If Scotland Yard failed to do so adequately when the hacking was first uncovered several years ago, then that is more troubling than the hacking itself.
Of course, when “the hacking was first uncovered several years ago,” News Corp did a more than adequate job of bribing British authorities to keep them at bay. As David Carr pointed out yesterday, the company’s fondness of drowning legal problems in hush money has been pervasive, far from the domain of a single tabloid. “We didn’t get caught” is about as bad an excuse as they come, especially with the tactful omission of “…because we bribed the police.”
The second point is a dicey defense of resigned Journal publisher Les Hinton, which fails to mention the reason for his resignation: ostensibly, the two times he stood before the Houses of Parliament and said that only one News International journalist had ever hacked a phone.
The piece then moves inexplicably into self-defense mode, claiming that, well, even if News Corp is a bit unsavory, the company has improved the Wall Street Journal. Of course, a revitalized Journal must be of great consolation to hacking victims, who must also “shudder to think what the Journal would look like” under the dreary Bancrofts. And so we breeze right along to find the paper arguing for the legality of paying sources for information. But “the Wall Street Journal doesn’t pay sources for information.” So who does? Other News Corp outlets?
Again, we move on too fast to find out, and close with the same shoddy reasoning that Murdoch himself has already aired out in the Journal’s pages. Namely, that News of the World’s behavior constituted nothing more than journalistic overreach, and that cracking down on News Corp means inhibiting freedom of the press:
Do our media brethren really want to invite Congress and prosecutors to regulate how journalists gather the news?
News Corp outlets broke the law. And yet, the word “crime” is not mentioned once in the editorial. The Journal goes for a brazen euphemism, instead claiming that the tabloid’s “excesses” do not damage the reputation of its sister outlets:
The News of the World’s offense—fatal, as it turned out—was to violate the trust of its readers by not coming about its news honestly. We realize how precious that reader trust is, and our obligation is to re-earn it every day.
The News of the World’s “offense” was to commit crimes, then lie and bribe to cover them up. “Trust” is a convenient, slippery term for the Journal to use. But surely, a paper of such clout must realize that its readers know the difference between breaking trust and breaking the law. At any rate, it’s likely that News Corp is soon to find out for itself.
By: Alex Klein, Guest Columnist, The New Republic, July 18, 2011
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