Posted by AzBlueMeanie:
As regular readers know, I tend to agree with the opinions of Steve Benen at the Washington Monthly. His analyses are well-reasoned and well-written. So let's take a look at the question of what Friday night's "midnight hour" 2011 budget compromise really means for the future.
The first question is whether the 2011 budget compromise does anything to create jobs and to grow the economy. It does not. A Raw Deal:
There was arguably no way this budget fight was going to end well. In November, Americans elected the most conservative House majority in modern political history, and in December, Senate Republicans derailed an omnibus that would have funded the government through the end of the fiscal year.
Those two developments ensured a few things: (1) we'd see an ugly battle that could lead to a shutdown; (2) President Obama was going to have to compromise; and (3) the end result wouldn't be pretty.
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Consider it this way: on Feb. 3, just nine weeks ago, the House Republican leadership unveiled their spending-cut plan, which would have cut $32 billion for the remainder of the fiscal year.
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What's more, the $32 billion offered by the GOP leadership two months ago was their opening bid. They expected to compromise from there, and their plan included no policy riders at all.
It seems ridiculous now, but if Democrats had, on that very day, accepted the House Republican leadership's spending cuts right there on the spot, it would have been a better deal than the one we ended up with last night.
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I realize Dems were left in an untenable position: allow a shutdown that would hurt the economy or accept spending cuts that would hurt the economy. Republicans, and the voters who mistakenly gave Republicans considerable power and influence, came up with the misguided agenda and relied on a hostage strategy that tends to work for them.
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But I still can't defend the deal on the merits.
Ezra Klein offers this tale of the tape.
The final compromise was $38.5 billion below 2010's funding levels. That's $78.5 billion below President Obama's original budget proposal, which would've added $40 billion to 2010's funding levels, and $6.5 billion below John Boehner's original counteroffer, which would've subtracted $32 billion from 2010's budget totals. In the end, the real negotiation was not between the Republicans and the Democrats, or even the Republicans and the White House. It was between John Boehner and the conservative wing of his party. And once that became clear, it turned out that Boehner's original offer wasn't even in the middle. It was slightly center-left.
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At a more fundamental level, the question that mattered most — with a weak economy and high unemployment, whose bright idea was it to scrap public investment and take billions out of the economy? — was never even asked. Because Dems flubbed the debate from the outset, the entire discussion ignored job creation, leading to a fight that boiled down to "a lot of cuts vs. a whole lot of cuts."
Keep in mind that what was agreed upon is a stop-gap continuing resolution (CR) to later in the week, when another vote on the actual 2011 budget compromise must be voted upon.
Will the Tea-Publicans who "lusted in their hearts" for a government shutdown and were disappointed actually vote for the deal negotiated by the Weeper of the House? Looking a Conservative Gift Horse In The Mouth:
As budget developments unfolded late last night, one of the prominent Tea Party group declared that House Speaker John Boehner (R-Ohio) was "selling out" far-right activists. The group vowed to launch a primary campaign against him.
Even on Capitol Hill, high-profile conservatives actually sounded unhappy about the Republican victory.
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Rep. Michele Bachmann (R-Minn.) was also quick to blast the budget agreement.
You've got to be kidding me.
Look, I realize the right didn't get literally everything it demanded, but Republicans managed to play a very weak hand and win a handsome prize. Democrats control the White House and the Senate, polls showed strong opposition to the priorities the GOP wanted to pass, and Republicans still got a favorable deal. For the right to whine about it now is absurd.
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At this point, however, the party believes it may face as many as 40 Republican defections, but leaders will "work strenuously to keep the number below 30." Either way, Boehner will need some Blue Dogs to cross the finish line.
The stop-gap continuing resolution to prevent a government shutdown was actually the easiest part. What lies ahead will give the Tea-Publicans more opportunities to shut down the government over their radical extremist agenda. The Next Bite At The Apple:
No one wants to hear this, but there are three moments for a budget crisis in 2011: wrapping up the current fiscal year, extending the debt limit, and next year's [2012] budget. The first was wrapped up last night, and as ridiculous as this may sound, it was arguably the easiest of the three.
[A] Republican congressional aide told Roll Call, "This is going to be nothing compared to the debt limit." Or, as Sen. Kay Bailey Hutchison (R-Texas) told CNN yesterday, "The debt ceiling is going to be Armageddon."
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And so, just as one fight ends, the next is right around the corner.
The federal government will exhaust its ability to borrow money under current law during the second week of July, the Treasury Department said in a letter sent Monday to members of Congress.
The government will hit the debt limit — the maximum amount that it can borrow — "no later than May 16," the letter said; after that, "extraordinary measures" can create roughly eight weeks of wiggle room.
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We don't yet know exactly what Republicans will want to prevent this global financial disaster. It's tough to demand massive entitlement cuts, since that's what they have in mind for the third round (the budget for the next fiscal year). There's talk of demanding a balanced-budget amendment to the U.S. Constitution — one of the worst ideas in the history of the world — but that's obviously too high a price.
But while we wait for the ransom note, keep in mind that Republicans know they're playing with fire.
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At this point, it appears that Republicans know all of this, but don't much care. They're the hostage takers, they're looking for "leverage," and they think they've found it.
More about that Tea-Publican hostage strategy, something they used to great success in December to get the White House and Democrats to capitulate on the extension of the Bush tax cuts for the 'two percenters." The Efficacy of a Hostage Strategy:
Matthew Yglesias offered a helpful reminder this morning about leverage.
If you genuinely don't care about the interests of poor people and stand to benefit electorally from weak economic growth, this gives you a very strong hand to play as a hostage taker. And John Boehner is willing to play that hand.
Right. A hostage strategy works well when the hostage taker makes it clear that killing the hostage is a perfectly viable option.
In this case, President Obama knew he was facing an unpleasant choice: accept spending cuts, which would hurt working families and undermine the economy, or allow Republicans to shut down the government, which would hurt working families and undermine the economy. As much as I really don't like the agreement reached last night, I'm not unsympathetic to the dilemma.
But it's worth appreciating the dynamic itself. The moment it was clear that the White House and congressional Democrats were determined to avert a shutdown, and congressional Republicans saw a shutdown as a reasonable, if not attractive, option — one that their base would celebrate — the rules of the game were already written to guarantee a discouraging result.
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Or as Greg Sargent put it this morning, "Republicans knew full well that the White House wouldn't allow a government shutdown, allowing them to continue to move the spending-cut goalposts in the knowledge that Dems would follow — again ensuring that the debate unfolded on the GOP's turf."
The hostage strategy of the past week is mere prelude to the main event to come over raising the federal debt ceiling – Armageddon – as Sen. Kay Baily Hutchinson called it. On Debt Ceiling, A Simple Request:'A Clean Bill':
On Fox News [Sunday], House Majority Leader Eric Cantor (R-Va.) said he's prepared to play a dangerous game with the federal debt limit — he'll help block an extension without "guaranteed steps" on unspecified cuts to public investments.
It is, in other words, another hostage strategy. Last week, the message was, "Give us what we want or we'll shut down the government." Going forward, the new message is, "Give us what we want or we'll wreak havoc on the global economy and trash the full faith and credit of the United States government.
The details of the ransom note apparently haven't been written yet, but we're getting clues.
Congressional Republicans are vowing that before they will agree to raise the current $14.25 trillion federal debt ceiling — a step that will become necessary in as little as five weeks — President Obama and Senate Democrats will have to agree to far deeper spending cuts for next year and beyond than those contained in the six-month budget deal agreed to late Friday night that cut $38 billion and averted a government shutdown.
Republicans have also signaled that they will again demand fundamental changes in policy on health care, the environment, abortion rights and more, as the price of their support for raising the debt ceiling.
The stakes of the Republicans' hostage strategy are significantly higher than the budget fight, at least insofar as the consequences would be more severe. Had the GOP shut down the government, it would have been awful for the economy; if the GOP blocks an extension of the debt ceiling, the results could prove catastrophic.
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Republicans freely admit they're doing it anyway. Indeed, they've been rather shameless about it. Cornyn Wants To Play With Fire; Will We All Get Burned?.
It seems to me President Obama's message should be pretty straightforward: "To prevent a crisis, I expect a clean bill."
This isn't complicated. Democrats and Republicans have, routinely, raised the debt limit many times. Neither party has ever held it hostage, or made sweeping demands. Economists, government officials, and even financial industry leaders have all told Republicans to reject the political games and do what's right.
What's more, as we discussed yesterday, even Republicans know how this has to turn out. House Speaker John Boehner (R-Ohio) recently said failing to raise the debt limit "would be a financial disaster, not only for us, but for the worldwide economy." Sen. Lindsey Graham (R-S.C.) said failure to raise the debt limit would lead to "financial collapse and calamity throughout the world."
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Just pass a clean bill, prevent a calamity, and get ready for the larger budget fight.
Unfortunately, I do not see this occurring. The Weeper of the House barely survived in the first round. He does not have control of his Tea-Publican Caucus. They want their radical extremist agenda enacted and they know that holding the country hostage is their only means to get what they want (the public does not support their radical extremist agenda). The Weeper of the House is going to get steamrolled by the Tea-Publican tyranny, you just watch.
Which brings me to a final point made by Steve Benen which does not bode well for our future. The Washington Monthly:
Once Democrats commit to systematic debt reduction as policymakers principal goal — as opposed to, say, economic growth — it sets the terms of the debate. The unyielding dynamic locks everyone into answering the same question: how do tackle the deficit and the debt?
That's the question Republicans (and much of the media) want as the central focus, but there are more pertinent and important questions that should be prioritized, such as, "How about a jobs plan to reduce unemployment?" Or maybe, "How will taking money out of the economy and reducing public investment lead to more growth?"
What's more, it also sets baselines for a "compromise." If Obama presents a credible … moderate counterweight to Paul Ryan's radical House budget plan presented a few days ago, [this] may not be wise — if recent history is any guide, negotiations will produce a deal that's somewhere in between.
In this case, that'd be a disaster. Even half-way to Ryan's roadmap would destroy much of the modern American social compact, and prove devastating to the middle class.
President Obama's constant need to produce a "compromise" so he can be viewed as a "uniter" can lead to disasterous results. I am not at all confident in what the next several weeks hold in store for our future. President Obama needs to be more like the other president from Illinois, Abraham Lincoln. He needs to be willing to go to war against the insurrectionist Tea-Publican tyranny holding our country hostage. Obama has not demonstrated to me that he has the will to take a stand to preserve our Union. He has his constitutional duty to do so.