Sunday, July 31, 2011

Contrasts in House Leadership

Ezra Klein Makes a very astute observation of the contrasts in leadership from Speaker Pelosi to Speaker Boehner,
When Nancy Pelosi served as Speaker of the House, her job was conditioning her members for disappointment. It was Pelosi who had to bring them around to a Senate-designed health-care law that lacked a public option, a cap-and-trade bill that gave away most of its permits, a stimulus that did too little, a bank bailout that endangered their careers. Pelosi had to do that because, well, that’s what the speaker of the House has to do. To govern is to compromise. And when you’re in charge, you have to govern.
But Boehner chose a different course.
He made his bill more conservative. He indulged his members in the fantasy that they wouldn’t have to make compromises. It’s as if Pelosi, facing criticism for dropping the public option, had tried to shore up her support by bringing a single-payer health-care bill to the floor. Even if that would have pleased her left wing, what good would it have done her? Her job was to prepare her members to take a vote that could lead to a successful outcome
It remains to be seen if Boehner's indulgence of the right-wing freshman was a mistake or not. Ezra's definition (and mine as well) of a successful outcome, and Boehner's are clearly two different outcomes.

So far, the Freshmen refusal to compromise much at all has gotten them what they want. The Democrats have capitulated to this point, seemingly getting only a debt increase that will last thru the 2012 election without making the Bush tax cuts permanent.

But, no compromise bill has passed through the House and I've seen nothing in the words or conduct of the Freshmen that suggests to me they have any intention compromising beyond the Bill passed Friday night.

I'm convinced the Freshmen welcome a default.

So, while all the nattering nabobs in the Village seem convinced that Boehner somehow "must" work with Democrats to get through this compromise Bill, Boehner certainly has said nothing -- or done nothing to this point -- to suggest he has any intention of doing so.

"It's my way or the highway" has worked so far, why would they change course now?

Friday, July 29, 2011

Attributing Acts of Terror to Religion

Earlier I described the man accused in the Norway massacre as "Christian terrorist Anders Breivik". I did this not because I think Christianity was responsible for the action of this mad man, but to point out the absurdity of those on the right insisting that any terrorist who is also a Muslim be labeled a Muslim terrorist. I'm sure for many my intentions were not clear.

Anyway, The Daily Show takes on this issue this week very clearly making the point I failed to make.

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Thursday, July 28, 2011

Netflix Relief Fund

It's time to be serious.

Words I never thought I would type

Michele Bachmann is right. Enough already! Leave her husband alone.

Of course it's crazy to think you can "cure" homosexuality through therapy, prayer or whatever. What did you expect? This is Michele Bachmann's husband, for Christ's sake! That one can be "cured" of homosexuality is a religious view that, unfortunately, many Americans share. The Bachmann's have the right to their own religious views just has tragically misguided religious self-loathing gay people have the right to seek a religious "cure".

Sure, Marcus Bachmann may very well be a major closet case, but who cares? Of course he reminds all of us of Cam on Modern Family. That is not the point.

The public certainly has the right to know when the spouse of a candidate for public office holds controversial views or who's profession might be controversial, but enough all ready. It's been reported and thoroughly covered, so move on.

I hate it when the media obsesses over a candidate's spouse or family members, seeking sensation over important and substantive coverage of the candidate's views and positions. The fact that this sort of character destruction is a favorite game of Republican strategists doesn't make it right. I hated it when it was Geraldine Ferraro's husband, First Lady Hillary Clinton or Michelle Obama who was outrageously described by Fox News as "Obama's baby moma"(video here). None of them deserved the abuse they took and neither does Marcus Bachmann.

Michele Bachmann is a genuine wackadoodle lunatic with bat-shit crazy ideas and that needs to be the focus of press coverage. It goes without saying that anyone who married this kook has to be nuts himself. But focus on the candidate.

The summer of liberal discontent

With all the focus on the GOP civil war, it's easy to forget that the Left is very unhappy too.

Politico's White House correspondent Glenn Thrush sums it up,
Democrats ... are increasingly restive as they balance loyalty to Obama and their own commitment to preserving entitlement programs and tax equity, core principles which they see as being chucked overboard in the interest of appeasing tea party Republicans. ... 'Every policy outcome for liberals is a loss at this point,' said a senior party operative ... A Washington Post survey released last week found that the percentage of self-described liberals who 'strongly' support the president's performance on jobs has fallen 22 points [since last year], from 53 percent to 31 percent now. The percentage of African-American Democrats ... who think he's doing a good job on the economy has plummeted from 77 percent last year to a little over 50 percent now. ... Most liberals have nonetheless always closed ranks around Obama, and he remains the most popular leader of their party in a generation. ... The White House, led by Stephanie Cutter, ... keeps in regular contact with progressive leaders. Shortly before Obama's Monday night speech to the nation Cutter checked in with the group, which pressed her politely on the Medicare proposal; Cutter reportedly assured them that the deal was off the table.

Yes, it is scary but what does it mean

David Frum,
Early this morning, I had breakfast with a member of Congress—a person I like, respect, have donated to in the past, will donate to in the future, and know isn’t crazy. This man shares at least 90 percent of my views. He’s not a Tea Party Caucus member but is a stalwart in the conservative Republican Study Committee. He has a safe seat and, like me, sees some serious problems with the Boehner plan. That said, he made it clear that he’s not going to vote for the plan or anything much like it. I didn’t argue with him—he’s a man of conviction and believes in what he’s doing—but he’s exactly the sort of level-headed conservative who is going to be needed to get the plan (or anything realistic that raises the debt ceiling) across the finish line. Without his vote, we’re heading for default.
Does this mean he will not vote to raise the debt ceiling under any terms? Or, under what terms will he support an increase in the debt ceiling? David doesn't say.

I'm convinced that a very large number of House conservatives have no intention of raising the debt ceiling.

Rep Joe Walsh's Tea Party Glass House

Jon Capehart in the WaPo today,
The new embodiment of “those who live in glass houses shouldn’t throw stones” is Rep. Joe Walsh (R-Ill.) He’s called President Obama a liar on the debt-ceiling issue. In that now infamous YouTube video, Walsh hectors the president. “I won’t place one more dollar of debt upon the backs of my kids and grandkids unless we structurally reform the way this town spends money!” he said. Or should I say “he said rhetorically

According to the Chicago Sun-Times, Walsh's ex-wife has been suing him for the last nine years for $117,437 in child support.

Walsh's lawyer does not deny that he owes back child support, but does dispute the amount. Having practiced family law in Illinois for a number of years, I can tell you that a claim for back child support means he's been under a court order to pay a sum certain every month and has obviously not been keeping up with those payments. It is usually an easy mathematical task to add up a child support arrearage. The obligation to pay an exact amount per month having already been decided, apparently 9 years ago. Illinois has generous pre and post judgment interests laws which may have put some water in this number.

I'm guessing this big-mouthed douche will be looking for work come next November. I just hope he stands for re-election for what should be an easy Democratic pick-up.

And don't forget to show @RepJoeWalsh some twitter love today.

UPDATE: Walsh's statement on the Sun-Times story. Walsh calls the story 'a hit piece' but does not deny any of the allegations.

High Praise in Foreign Policy

What American couldn't use a little good news today? David Rothkopf offer's high praise of some work overseas that has been mostly unnoticed,
In this moment of national confusion and public despair with officials in Washington, variations on the following cry have often been heard, "Somewhere in the world there must be an American political leader with a vision of tomorrow, a focus on what is really important and an ability to translate rhetoric into success."

I'm pleased to report that there is. If it has escaped your attention it's because that politician has been on the other side of the world the past couple of weeks advancing American interests and the policies of the president with meaningful results and exceptional skill.

That politician is Secretary of State Hillary Clinton, who is just completing an around-the-world mission that has taken her from the economic frontlines of the eurozone crisis to the markets of tomorrow in Asia. The trip, obscured in the noise around the debt ceiling debate, has been a real triumph for the Obama administration and has revealed that many of its policies over the past two years are now bearing significant fruit. It has also revealed the State Department's deftness and bench-depth in dealing with an Asia agenda that is vastly more important in every respect than virtually anything that has been discussed inside the beltway for months.
If you need a little boost, I would encourage to read the whole post. From opening up a new relationship with India while strengthen frayed ties with Pakistan (who would have thought both of these were even possible?)while simultaneously forging a deep relationship with China "but also systematically and often invisibly working to strengthen ties with many of the smaller countries in Asia."

There is no question that Asia is the future of the 21st century and having an administration that understands this is in and of itself, great news.

GOP -- Specials Victims Unit

The Daily Show was on fire last night. It has to take hours to put together this video montages.

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Monday, July 25, 2011

Erick Erickson is the GOP Puppet Master?

Erick Erickson wrote today at his RedState site,
In the past 48 hours I have had call after call after call from members of the United States Congress. They’ve read what I’ve written. They agree. But they feel the hour is short and the end is nigh.

So some are calling looking for alternatives. Some are calling looking for energy. Many are calling looking for absolution.

And so I address them and put it here so you can see my advice.

I can give no absolution for what you may be about to do. I can offer no alternatives.

For thirty years and seventeen debt commissions we have raised the national debt $13 trillion, seen taxes rise and fall and rise again, uncertainty come and go, and Washington remain unchanged. And now some of you want to seek cover by having yet another commission — but this time it will be different! Sure.
Seriously? Erick Erickson is calling the shots for the GOP and telling them to thrash the full faith and credit of the U.S.

Please tell me he is delusional.

Did Harry Reid call the GOP's bluff

How the impotent Harry Reid could catch anyone off guard is a mystery to me, but it seems he has done just that. On Sunday, Harry Reid called the GOP's bluff by giving them exactly what they have been demanding: A plan that offsets a $2.7T increase in the debt ceiling with a corresponding $2.7T in cuts to spending and no new revenues.

Reid's plan evidently caught the GOP off guard and it took them some time to think about how they could reject it -- but reject it, they have. One reason for rejection, as outlined below, is to insist that only Paul Ryan can count money not spent in Iraq and Afghanistan as savings.

Matt Yglesias suggests that perhaps the GOP was never actually negotiating in good faith,
Republicans are rejecting this even though it nominally meets their demands. Why? Because it doesn’t achieve either of their two real objectives. In particular, the plan doesn’t cut Medicare, which means that Democratic party candidates for office in November 2012 and 2014 can accurately remind voters of the content of the Republican [Ryan] budget plan. In case you forgot, this plan repeals Medicare....It was only after voting for this plan that Republicans seem to have realized that repealing Medicare is unpopular. Since that time, they’ve been trying to entrap Democrats into reaching some kind of Medicare d├ętente with them, which would immunize them from criticism [see for example here]. Reid’s plan doesn’t do that.

Second, while Reid’s plan doesn’t raise taxes, it also doesn’t take tax increases off the table. Currently, the Bush tax cuts are scheduled to expire in 2012. If Reid’s all-cuts plan passes, that still leaves the door open to significant revenue increases. Now that doesn’t mean this is brilliant 11-dimensional chess. The Reid Plan is consistent with substantial revenues coming online in 2012, but that will only happen if President Obama and Senate Democrats stand firm and play hardball on the tax issue. Back in December 2010, they utterly failed to do so.
In the spirit of fair and balanced reporting that is the hallmark of the non-partisan Ward Report, there are reports this morning that Obama might also be nixing Reid's deal.

GOP can't have it both ways on war spending

Part of the savings in Harry Reid's proposed deficit savings comes from cost savings in winding down the wars in Iraq and Afghanistan. Republicans see this has a gimmick by counting as 'savings' money not spent. And they may be right, except that much of the 'savings' in the first 10 years of Paul Ryan's budget is the identical cost savings by winding down the wars. And the assumption of the wars in Iraq and Afghanistan continuing at the current level plus inflation are including in the CBO estimates used by Speaker Boehner.

Ezra Klein explains,

There’s some truth to this argument, as I’ll explain in a minute. But the GOP is trying to have it both ways. Boehner uses the Congressional Budget Office’s deficit estimates. He doesn’t subtract trillions because he doesn’t believe the agency’s war-spending estimates are faulty. Nor do I remember him calling the savings from Paul Ryan’s budget — which Boehner voted for — fake.But the Congressional Budget Office counts trillions in war spending in its budget baseline, and Ryan’s budget cut a trillion dollars from the Iraq and Afghanistan wars.

In fact, cutting war spending was one of Ryan’s largest sources of savings over the first decade. The following table, which you can find in larger form in this document (pdf) at the House Budget Committee’s Web site, estimates them at $1.04 trillion against the Congressional Budget Office’s baseline.

The CBO in estimating future spending looks at current spending in Afghanistan and Iraq and assumes that spending grows by the rate of inflation. So CBO estimates of future spending do not take into account plans to wind down both wars. However, the estimates used by Paul Ryan and Harry Reid assume both wars will be wound down as planned and count the money not spent as savings.

Sunday, July 24, 2011

Christian Terrorist Anders Breivik

The Sunday NYT describes the terrorist believed responsible for the Friday massacre in Oslo,
As stunned Norwegians grappled with the deadliest attack in the country since World War II, a portrait began to emerge of the suspect, Anders Behring Breivik, 32. The police identified him as a right-wing fundamentalist Christian, while acquaintances described him as a gun-loving Norwegian obsessed with what he saw as the threats of multiculturalism and Muslim immigration.

“We are not sure whether he was alone or had help,” a police official, Roger Andresen, said at a televised news conference. “What we know is that he is right wing and a Christian fundamentalist.”

In the 1,500-page manifesto, posted on the Web hours before the attacks, Mr. Breivik recorded a day-by-day diary of months of planning for the attacks, and claimed to be part of a small group that intended to “seize political and military control of Western European countries and implement a cultural conservative political agenda.”

The manifesto, entitled “2083: A European Declaration of Independence,” equates liberalism and multiculturalism with “cultural Marxism,” which the document says is destroying European Christian civilization.
It all sounds very familiar, doesn't it?

Recall the GOP outrage when the FBI and Department of Homeland Security released a report warning of the dangers or right-wing extremism?

Can we all assume the GOP will be lining up on Monday to apologize to the FBI and DHS?

Will Fox News accurately describe Anders Breivik as a Christian terrorist?

In the video below, pay particular attention to Joe Scarborough's laughing out loud and calling Janet Napolitano "nuts". Tweet @JoeNBC and ask Scarborough when he plans to apologize to Janet Napolitano and more importantly, the hard working analysts who actually wrote the report.

Friday, July 22, 2011

"They are anarchists"

Andrew Sullivan calls out the GOP,
The Republican refusal to countenance any way to raise revenues to tackle the massive debt incurred largely on their watch and from a recession which started under Obama's predecessor makes one thing clear. They are not a political party in government; they are a radical faction that refuses to participate meaningfully in the give and take the Founders firmly believed should be at the center of American government. They are not conservatives in this sense. They are anarchists.

Their fiscal anarchism has now led to their threat to destabilize and possibly upend the American and global economy because they refuse to compromise an inch. They control only one part of the government, and yet they hold all of it hostage. I cannot believe they are prepared to allow the US to default rather than give an inch toward responsibility. Except I should believe it by now. Everything I have written about them leads inexorably to this moment.
I've written a couple times (here and here) that it appeared that the House Republicans/Cantor's tactic was to refuse any and all 'deals' until the President conceded to all their demands. That basically happened today and the GOP walked away from the table. They really are kooks.

Thursday, July 21, 2011

NJ Gov Chris Christie is an Enourmous Jerk

What is a thin-skinned jack ass like Christie doing in politics? And this is the guy thought to be the great hope for the future of the GOP.

What Is Up With Grover Norquist?

David Kurtz has a smart piece up at TPM today trying to read the mixed signals Grover Norquist has been sending out.

Grover has spent the last 25+ years getting every Republican elected to the House and Senate to sign his "Taxpayer Protection Pledge" that forbids the signer to vote for a tax hike under any circumstances and defines any change in Federal law that results in increased Federal revenues as a tax hike unless it is offset by a tax cut.

As David points out, Grover is a very smart guy who doesn't misspeak. Grover's pledge is very clear cut and Grover has made it clear that even eliminating a loop-hole violates the pledge.

Except Grover has muddied the waters again, telling the Washington Post editorial board that allowing the Bush tax cuts to expire wouldn't constitute a violation of the no-tax-increase pledge. Hard to figure how you can square that circle, but it suggests Grover is giving his pledgees an out -- even though Grover said this morning on TV that he wasn't giving anyone an out. I don't believe it.


Grover answers to some very powerful people. His outfit, Americans For Tax Reform, has long taken in big bucks from corporate players and turned around and advocated for policies, including but not limited to tax policies, favored by those same business interests. That's his business model. The contributions don't have to be disclosed, but there's nothing illegal about the arrangement. It's one the national Chamber of Commerce has basically adopted to enormous political and financial effect.

That's why Grover doesn't misspeak. There's too much money on the line. It's why people pay attention to what Grover says. Not because he is some oracle. But because a lot of smart money flows through and around Grover. My hunch is the smart money wants a way out of the debt ceiling fiasco that avoids a U.S. sovereign default. They've got way too much on the line to see their financial interests exposed to the very real risks and uncertainties that a default would cause. It's only a hunch. But Grover doesn't do anything by accident.

My personal read is that Grover is really in a tough spot. As David suggests, the monied interests that fund Grover's operation want a way out except Grover's personal financial interests are in conflict. Once Republicans break The Pledge and the sky doesn't fall upon them, Grover becomes the emperor with no clothes. The gigs up and Grover is out of business.

Grover is damned if he does, and damned if he doesn't. This couldn't happen to a more deserving guy.

Wednesday, July 20, 2011

Megan McArdle gets specific

Responding to Republicans who insist there's plenty of money for debt service, military payrolls, Social Security, Medicare, and Medicaid payments without raising the debt ceiling, Megan makes a list of what won't get paid,
  • You just cut the IRS and all the accountants at Treasury, which means that the actual revenue you have to spend is $0.
  • The nation's nuclear arsenal is no longer being watched or maintained
  • The doors of federal prisons have been thrown open, because none of the guards will work without being paid, and the vendors will not deliver food, medical supplies, electricity,etc.
  • The border control stations are entirely unmanned, so anyone who can buy a plane ticket, or stroll across the Mexican border, is entering the country. All the illegal immigrants currently in detention are released, since we don't have the money to put them on a plane, and we cannot actually simply leave them in a cell without electricity, sanitation, or food to see what happens.
  • All of our troops stationed abroad quickly run out of electricity or fuel. Many of them are sitting in a desert with billions worth of equipment, and no way to get themselves or their equipment back to the US.
  • Our embassies are no longer operating, which will make things difficult for foreign travelers
  • No federal emergency assistance, or help fighting things like wildfires or floods. Sorry, tornado people! Sorry, wildfire victims! Try to live in the northeast next time!
  • Housing projects shut down, and Section 8 vouchers are not paid[including Section 8 elderly payments]. Families [and grandma] hit the streets.
  • The money your local school district was expecting at the October 1 commencement of the 2012 fiscal year does not materialize, making it unclear who's going to be teaching your kids without a special property tax assessment.
  • The market for guaranteed student loans plunges into chaos. Hope your kid wasn't going to college this year!
  • The mortgage market evaporates. Hope you didn't need to buy or sell a house!
  • The FDIC and the PBGC suddenly don't have a government backstop for their funds, which has all sorts of interesting implications for your bank account.
  • The TSA shuts down. Yay! But don't worry about terrorist attacks, you TSA-lovers, because air traffic control shut down too. Hope you don't have a vacation planned in August, much less any work travel.
  • Unemployment money is no longer going to the states, which means that pretty soon, it won't be going to the unemployed people.
The Republican party is governed by fools who haven't the faintest idea how import or pervasive government is in the modern world.

A friend recently pointed out to me that many laws require a Federal inspection be done before certain products are allowed to ship overseas. With no inspectors, US shipments of good to foreign markets just stop. And what happens to those people who make the products that cannot be shipped?

You get frustrated with a Democratic controlled Congress that often seems feckless and too timid or divided to govern and then you meet the alternative. Morons. Literally morons. People so uninformed and illiterate that you wonder how they find their way to work each day.

Saint Ronald Reagan Weighs in on the Debt Ceiling

This excerpt is from Ronald Reagan's radio address of September 26, 1987.

Sen Franken takes down Focus on the Family

At a Senate hearing regarding the repeal of DOMA, Sen Al Franken(D-WI) takes down a Focus on the Family witness for mischaracterizing a study on "nuclear families".

Tuesday, July 19, 2011

Bachmann passes Romney in National Poll

In the latest Public Policy Poll (pdf) Michele Bachmann's momentum continues to build with her taking the lead for the first time in a national presidential poll. 21% of Republican primary voters favor Bachmann to Romney's 20%.

It's a paper thin margin for sure, but there is no way this is not devasting news to Romney and the Republican Party.

How much longer can rational people continue to identify themselves as Republicans?

David Brooks may have left the party this morning.

Sunday, July 17, 2011

Fox News "7 Myths About the Looming Debt-Ceiling 'Disaster"'

Provides great insight into what Cantor et al are thinking. In particular, 'myth 1',
1) Not increasing the debt ceiling means the U.S. government will default on its debt. This is probably the biggest lie that almost all other claims arise from. Default occurs if the government stops paying interest on the money that it owes. Not increasing the debt ceiling only means that the government can't borrow more money and that spending is limited to the revenue the government brings in. And, with interest payments on the debt making up less than a ninth of revenue, there is no reason for any risk of insolvency.
This is true. The Federal Government does have income to pay our bills, just not all of them. First and foremost, Treasury will pay interest on the national debt, and after this obligation is satisfied the executive branch must decide and prioritize what other bills will be paid.

For Cantor and his fellow 'conservatives' this is a dream come true. They imagine that
Social Security and Medicare (both programs have their own income stream from separate payroll taxes) will be de-funded proving to the American people that those programs are not dependable and must be abandoned.

And our soldiers must be paid, and be supplied. Cantor et al know that this will take a lot of money and if there isn't enough, they presume that the voters will blame Obama.

And finally, what ever bills Obama chooses to pay and not pay will give the GOP plenty of ammunition going into the election. Obama is damned if he does, and damned if he doesn't.

The debt ceiling quagmire is simply the natural extension of the GOP strategy since Obama took office. Simply vote 'no' on everything to stymie his government and destroy his presidency. The 2010 election was seen as an affirmation of this strategy, and certainly Obama didn't appear to do anything to make the GOP pay a price for this strategy.

Below I wrote that that Cantor et al were simply waiting for Obama to cave to all their demands, passing the debt ceiling upon Obama's unconditional surrender, but that might be naive. It may be that House conservatives have no intention of making a deal, any deal.

(h/t @STLWasker)

Friday, July 15, 2011

Applying Occam's Razor to the debt talks

Occam's Razor (to over simplify) stands for the proposition that the most basic possible explanation is likely the correct explanation.

The simplest explanation to explain the behavior of Cantor et al is that his goal is to humiliate Obama by refusing to make any concessions on the assumption that on the deadline, Obama will cave in to his demands rather than risk a default. When Obama caves he can claim victory, rub Obama's nose in it publicly and become a folk hero to the lunatic fringe that controls the GOP. Obama will be the one to sign off on major Medicare and Social Security cuts, etc. Cantor could not care less about good public policy or even reducing the Federal deficient (In 8 years of Bush when was a balanced budget ever submitted?).

This is zero sum politics and Cantor believes that all he needs to do is refuse any and all compromises and Obama and the Democrats will have no choice but to cave to his demands.

And Cantor may be right.

Wednesday, July 13, 2011

'Never Take a Hostage You're Not Prepared to Shoot'

The WSJ climbs on board the McConnell plan and begins the process of trying to rein in the kooks,
Republicans who say they can use the debt limit to force Democrats to agree to a balanced budget amendment are dreaming. Such an amendment won't get the two-thirds vote to pass the Senate, but it would give every Democrat running for re-election next year a chance to vote for it and claim to be a fiscal conservative.

The tea party/talk-radio expectations for what Republicans can accomplish over the debt-limit showdown have always been unrealistic. As former Senator Phil Gramm once told us, never take a hostage you're not prepared to shoot. Republicans aren't prepared to stop a debt-limit increase because the political costs are unbearable. Republicans might have played this game better, but the truth is that Mr. Obama has more cards to play.

The entitlement state can't be reformed by one house of Congress in one year against a determined President and Senate held by the other party. It requires more than one election. The Obama Democrats have staged a spending blowout to 24% of GDP and rising, and now they want to find a way to finance it to make it permanent. Those are the real stakes of 2012.
In all my years as a political nerd, I've never seen anything like this. It's absolutely fascinating to watch.

Is the GOP leadership (as opposed to the rank and file) in full retreat?

Tuesday, July 12, 2011

McConnell's Bizarre 'Plan B'

Further evidence of the GOP caucus shattering in the heat of the debt ceiling negotiations (see the post below), is what seems to me to be a truly bizarre 'plan B' proposed today my Mitch McConnell.

The WaPo outlines McConnell's fall back,
Under the proposal, Congress would change the rules surrounding the debt limit for the remainder of Obama’s first term.

That measure would create a new legal structure authorizing the president to raise the debt limit by as much as $2.5 trillion in three installments. The first, an increase of $700 billion, would come immediately. The next two, worth $900 billion each, would come this fall and sometime next summer.

On each occasion, Obama would be required to submit to Congress an explicit request for an increase, along with a menu of proposed spending cuts equal to the requested increase. The submission of the president’s first request would automatically raise the debt limit by $100 billion to give the Treasury Department breathing room while Congress considers the request.

Lawmakers would then have 15 days to pass a resolution of disapproval, giving them an opportunity to go on record against raising the debt ceiling. But Obama could veto the resolution, and the debt limit would then rise, providing that at least 34 Democratic senators stood firm in upholding his veto.

McConnell’s strategy makes no provision for spending cuts to be enacted. Aides said lawmakers could pick and choose from the president’s list when they put together appropriations bills in a separate process.
My friends at TPM see this proposal as McConnell blinking on the standoff with the White House.

Maybe so, but it seems more to me that this is just some partisan fantasy in which the GOP can completely abdicate any responsibility for leadership while boxing in the POTUS and skewering him for literally every increase in the debt ceiling (and at $100B cap, this will be about every 6 -8 weeks) and also skewering him for every proposed budget cut.

It's crazy, right? Obama has them on the run and a chance at real meaningful budget reforms. The Dems will never sign off on this, right?

I'm not that worried by Social Security cuts at the margins taking effect in 10 or 15 years because if the economy recovers those are easy to void. And you could completely scrap Medicare Part D as far as I'm concerned. Part D is nothing but a transfer of federal revenue to Big Pharma.

But if Obama and Congress really can strike a 'grand bargain' in the 3 to 4 Trillion dollar mark, this will have a dramatic effect on the stock market as well as the US and global economy. Recall the dramatic effect of Clinton's first budget that paved the way to surpluses.

Obama has the GOP on the run. Now is not the time for retreat -- now is the time to strike hard.

Given the conservative push back to McConnell proposal, I tweeted today that it would likely be dead within 24 hours. If I'm wrong (and I am all the time), we will really get the measure of Obama by his response.

UPDATE: Ezra has a thoughtful take on the McConnell plan.

Who's Running the House?

The WaPo get's the inside story in today's meeting at the White House,
Since pulling the plug on the deal, Boehner has been largely silent in the meetings, leaving House Majority Leader Eric Cantor (R-Va.) to present details of the House’s position. On Tuesday, people in both parties said, Obama tried to reestablish Boehner’s primacy.

Cantor, who is advocating a smaller deal, at one point demanded that Obama offer the details of his vision for a “grand bargain.”

“Where’s your paper?” he asked angrily.

Obama snapped back: “Frankly, your speaker has it. Am I dealing with him, or am I dealing with you?”
Is it just me or is the GOP House and Senate caucuses shattering under the pressure of the debt ceiling talks? They have drawn some very public and foolish lines in the sand (and the Dems are not innocent on this score)and it seems to be breaking them.

Friday, July 01, 2011

Does the 14th Amendment forbid a default?

This is getting a lot of press. Section 4 of the 14th Amendment,
Section. 4. The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned. But neither the United States nor any State shall assume or pay any debt or obligation incurred in aid of insurrection or rebellion against the United States, or any claim for the loss or emancipation of any slave; but all such debts, obligations and claims shall be held illegal and void.
Passed during Reconstruction following the Civil War, Section 4 was inserted to prevent Southern states rejoining the Union from attempting to default on the debt incurred funding the Union war effort and to prevent Southern states from forcing the Treasury to assume the debt of the Confederacy.

Congress has authorized the budgets that spent the money as well as the bonds that funded that spending to this point and having authorized this debt, the Government cannot now default.

But, can the Treasury borrow money without new Congressional authority to fund current budgeted spending beyond interest payments on past debt? In other words, can the Treasury issue new debt to fund the already budgeted war in Afghanistan without a Congressional increase in the debt ceiling? Or does the 14th Amendment limit Treasury borrowing to simply honoring past obligations?

The GOP will say that the Treasury can't borrow anything without a Congressional increase in the debt ceiling. What would the current Supreme Court say? What kind of tortured word twisting would Scalia go through to find Section 4 has no modern meaning.

We may find out sooner rather than later. I don't care what the talking heads from the Village say, the GOP has no intention of increasing the debt ceiling on anything but their terms which means no new revenue.