Debt Ceiling Update

July 18th, 2011 at 8:06 am

From this AM’s WaPo:

“A bipartisan effort in the Senate to allow President Obama to raise the federal debt ceiling in exchange for about $1.5 trillion in spending cuts over 10 years gained momentum Sunday, as leaders agreed they would have to act in the next two weeks to avert a potential default by the U.S. government.”

This means House R’s would have to give up their dollar-for-dollar demand re spending cuts for debt ceiling headroom, as President Obama insists that the increase in the ceiling gets us past the election.  So we’re talking about $1.5 trillion in cuts with no revenues as part of the deal, for a $2.5 trillion increase in the ceiling.

I was calling this “dirty McConnell” last week as opposed to the original McConnell idea which did not call for binding cuts.  I still don’t like it—I think it’s critical for the deal to balance the spending cuts with at least some revenues.  When cuts do all the lifting, we risk undermining programs that protect the vulnerable, educate our kids, retrain our adults, invest in research and infrastructure, and provide much needed health and retirement security for retirees.

Whether this unbalanced deal is a bridge too far for D’s in both the House and Senate is to be seen.  I suspect it won’t be and that it will continue to gain traction.  The House R’s will view it as a good deal, they can keep their meshuganah Norquist pledge, the administration will have gotten something (dropping the $-for-$ demand), and most importantly, we’ll finally get the debt ceiling behind us.

But man, I knew our politics was in rough shape, but I don’t think I realized just how dysfunctional they really were until the last few weeks.  That would be bad enough if we were in a full employment economy…at 9.2% unemployment, it’s really kind of tragic.


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10 comments in reply to "Debt Ceiling Update"

  1. Observer says:

    With all due respect, I find it incredulous that you folks in Washington don’t understand just how rabidly stark-raving mad the Tea-publicans are. This is the culmination of over 20 years of nothing but hatred spewing from them and their propaganda machines, and you guys still seem to believe that these people are even somewhat reasonable. Maybe some of you folks need to get out and just talk to regular Joe’s and Sue’s to see the contempt that has been built toward Democrats over the years by Tea-publican politicians and their mouthpieces at Fox and talk radio. (As an example of how deluded they are, just consider that the clueless Republican faithful still think the nation’s fiscal woes are the result of irresponsible DEMOCRATs. If that doesn’t expose it, I don’t know what will.) This is serious and you guys need to wake up, and fight fire with fire. This jellyfish act by Obama and Democrats is going to end up giving what’s been built up over the last 80 years to Grover Norquist. Please wake up.

    • readerOfTeaLeaves says:

      Regrettably, I agree with this comment.

      To some of us, this dysfunction is not news.
      Some of these people would politicize buying an ice cream cone; they seem to perceive all of experience, and all of the universe, as ‘us-them’, ‘either-or’, ‘win-lose’.

      It’s a sobering moment.
      Glad you woke up, Dr. Bernstein.
      Welcome to our nightmare.

  2. Observer says:

    I suggest all Democrats read the comments from the Democrat-haters after E.J. Dionne’s column from today:

    Democrats seem to be clueless as to the viciousness. If they continue not understanding this, the country will soon be completely at the mercy of the top-of-the-food-chain Republican masters. And it’ll be primarily because of Democratic spinelessness because if Democrats were to fight fire with fire the country with be with them on issue after issue.

    • Chigliakus says:

      I think you overestimate the Democrats and underestimate the level of corruption and corporate capture of politicians on both sides. Neither R’s nor D’s want to risk their future cushy lobbyist gigs standing up for the interests of the greater US populace. Look at how even clearly criminal acts by some of the investment bankers, acts that contributed to the world-wide economic meltdown, go unpunished–even after they were bold enough to lie to a Senate subcomittee. Look at how we’ve seen no new banking regulation and no reinstatement of previous banking regulations. Look at how our Democratic president is willing to contemplate cutting on the social safety net. Look at how the ACA was turned into a giveaway to private health insurers and the public option was never even given a chance, despite the fact that the health insurance industry in the US is clearly dysfunctional. I do prefer the Democrats to the Republicans, but they’re not spineless in the face of Republican opposition, they’re just reluctant to stand up to their masters: the corporate oligarchy.

  3. Lex says:

    “at 9.2% unemployment, it’s really kind of tragic.”

    No, it’s not “kind of” tragic, it is unqualified malfeasance. Nontrivial numbers of the most vulnerable Americans ARE GOING TO DIE PREMATURELY as a result of these budget cuts, and every congresscritter of either party who votes for them will have blood on his/her hands, as will the president.

    Which, these days, is how you tell the VSPs from the DFHs.

  4. David R says:

    Meshuganah may be too mild, I think fakakta is maybe a better adjective.

    • Concerned says:

      One of the problems with Democrats and their approach to thing politically is their measured language. Democrats are simply going to have to understand this is becoming a holy war. They’re going to have to fight fire with fire. I hope they begin to understand that you can’t fight a frightening mob of implacably ignorant and/or stupid masses intent on destruction with wine-and-Volvo-and-NPR sensibilities. It’s not going to work.

  5. Blondie says:

    The problem is, these people are insane. But the more we point out their insanity, the angrier and more implacable they get. I agree with Observer – if you, Mr. Bernstein (and Washington Democratic officials, by proxy), are only now realizing this, we’re truly doomed.

    I found myself thinking last night that I’d almost (almost!) be willing to see default happen, IF IN RETURN Republicans would admit they’re wrong about everything when the global economy tanks. And they are wrong about everything!!

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