Slate’s John Dickerson takes the new Gang of Six plan (whose details are still sketchy) more seriously than TNR’s Jonathan Chait. Dickerson says a small bargain is no easier to get than a grand one, so you might as well be ambitious:
So now that McConnell’s face-saving deal looks as hard to get as the big deal, the big deal is back in play (at least for this sliver of the news cycle). All along the president has been saying that since a small deal was just as hard as a big one, why not go for the big one and at least get the credit? Yes, such a deal would require some kind of creative tax solution that would appeal to the president’s desire for balance. But it would also allow fiscal hawks to point to a big amount of savings as well as cuts in entitlement spending, which they have long sought.
Chait says the House Republicans will simply never agree to it:
In theory, you could image a minority of the House GOP caucus supporting such a plan along with a strong majority of Democrats. But remember that John Boehner needs the support of most House Republicans to keep his job. I suppose it’s possible to imagine a sequence of events in which Boehner supports a Gang of Six-style Grand Bargain, it passes over the objection of most House Republicans, and then Boehner quickly discovers a burning desire to help humanity via a private sector job.
Barring such a scenario, I don’t see how this goes anywhere.
I agree with Chait, mostly. Much as I wish they would, I don’t see how House Republicans can row back from their opposition to any and all revenue increases. But this does not mean that the Gang of Six resurgence is unimportant.
Its real significance–and the reason why Obama supported the new initiative so strongly (without knowing much about what it actually says)–is that it increases the risk to the House Republicans of refusing to agree to any deal. With an authoritative bipartisan proposal back in play, rejecting any and all compromise is a little harder to sustain: the House GOP looks even less reasonable and even more isolated. The political pressure on them to accede to a McConnell-like outcome (which calls for no increase in revenues) thus increases.
In other words, the (apparent) revival of the grand bargain improves the (actual) chances for a small bargain.
The emergence of the Tea Party in 2009 posed two questions. Would the movement capture the Republican party and, if it did, would this strengthen the resistance to Barack Obama’s liberal project or cripple it? The debt-ceiling fight in Washington settles the first issue: the Tea Party insurgency has indeed captured the Republican party in Congress.
A less than electrifying performance. I understand the difficulties and sympathize. There’s little Obama can do in the short term about the refusal of House Republicans to budge. As long as they are willing to destroy the nation’s credit standing if that is what it takes to win, Obama’s choice essentially boils down to capitulation in the national interest or mutually assured destruction. Even so, the press conference was dispiriting. Obama seemed unusually hesitant and unsure of himself. I’m not sure what he hoped to achieve by it.
Alexis Simendinger explains that the grand bargain Obama is demanding is already out of reach.
Writing any legislation takes time, and moving it through the House and Senate could take longer. Even if the president and the eight congressional leaders from both chambers suddenly sprinted to the Rose Garden waving a grand bargain sketched on legal pads, congressional enactment before the default-clock tolls is close to impossible, according to budget experts interviewed by RCP.
That’s why Senate Minority Leader Mitch McConnell took the first stab on Tuesday at an emergency escape hatch. His proposal would effectively abandon Congress’ legislative responsibility to approve the administration’s requests to lift the nation’s borrowing authority, and instead cede Obama the power — and presumably the political blame, should voters object.
Putting aside for the moment details of McConnell’s fallback idea, which appears unlikely to get serious traction among the House GOP, his search for a short-term fix was a signal that the usually canny Kentucky Republican now believes his colleagues need to identify Plan B.
If not McConnell’s stratagem, then what?
Hard to know whether to laugh or cry at the Republican party’s response to Mitch McConnell’s debt-ceiling proposal. One segment of conservative opinion sees it as a shrewd idea, a masterstroke even. Another regards it as a sell-out of historic dimensions. And a third appears to think it is both, and is trying to clarify its position.
Amid disturbing signs that the US recovery has stalled, President Barack Obama took a huge gamble in his approach to the debt-ceiling talks last week. Believing he had an understanding with John Boehner, leader of the Republicans in the House of Representatives, he declared he wanted a $4,000bn “grand bargain” on the budget. Barely a day later, Mr Boehner said the deal was off. By Sunday evening, with talks about to resume at the White House, the president’s gambit appeared to have failed.
With Obama raising the stakes in the game of debt-ceiling brinkmanship–going so far, according to some reports, as to threaten to veto a small-scale stop-gap deal–Bruce Bartlett clarifies some important points in a piece about five debt-ceiling myths. I find it hard to believe that the president really would veto a small bargain, by the way. If he did actually say that, he was bluffing.
Bartlett’s link to Garrett Epps on the 14th Amendment is worth following. I wonder what Treasury lawyers are telling the president about the constitutionality of the debt ceiling.
Update: Here’s what Lawrence Tribe is telling him: the debt ceiling can’t be ignored.
The Bipartisan Policy Centre, a Washington think-tank that strives to bring Democrats and Republicans together, just published a report on what might happen if talks to raise the debt ceiling fail. The scenario it describes is grim. Put it this way: the US is contemplating the greatest unforced error in the history of economic policy.
The Bipartisan Policy Centre crunches the debt-ceiling numbers. It finds that the the date on which the Treasury will no longer be able to pay all its bills–the X Date–will be “no earlier than August 2nd and probably no later than August 9th.”
What would happen next? There is no precedent, says the BPC. After looking carefully at the Treasury’s projected daily outflows and inflows, the presentation concludes that federal spending would have to be cut immediately by 44%. With decisions then having to be made on a day-by-day basis, prioritizing spending would be very difficult and “the reality would be chaotic”. The government has nearly $500 billion in debt to roll over during August, at a time when a spike in uncertainty plus threatened or actual debt downgrades would be pushing up interest rates.
“The risks are real,” says the BPC. No kidding.
Update: The Committee for a Responsible Federal Budget has updated its “Realistic Baseline”:
Under its Extended Baseline Scenario, CBO bases its projections on current law, which assumes many things that are unlikely to occur, including the expiration of all the 2001/2003/2010 tax cuts and the discontinuation of the regular policy of enacting “AMT patches” and “doc fixes.”
Under its Alternative Fiscal Scenario, CBO lays out a more fiscally pessimistic path, where policymakers increase discretionary spending this decade at the rate of GDP growth, revenues stop growing as a share of GDP altogether after 2021, and the cost controls enacted under Health Carereform (PPACA) are ineffective or overridden after 2021.
CRFB’s Realistic Baseline uses a set of realistic assumptions that fall between these two scenarios and is consistent with a “current policy” path. Under this baseline, debt would rise from 69 percent of GDP today to 88 percent in 2020, 140 percent in 2035, and 437 percent by 2080.
Jeff Rosen moderated this AIF session featuring Sandra Day O’Connor (former Supreme Court justice), Stephen Breyer (currently on the court) and Larry Kramer (Stanford law professor). I was unfamiliar with Kramer’s book, The People Themselves: Popular Constitutionalism and Judicial Review, though I intend to put that right after listening to his comments.
Kramer’s thesis is that the court has indeed mostly followed shifts in public opinion over the years–and that it has been right to do so. The constitution, he argues, is a majoritarian document, despite frequent claims to the contrary. But it is majoritarian in a restricted sense. The American solution to the “ills” (Madison’s term) of simple majority rule lies partly in slowing politics down through the complexity of the constitutional design. In this scheme, the Supreme Court, as the arbiter of the constitution’s meaning, has greater political independence than other branches of government, but is not, and was never meant to be, entirely independent. It has no electoral accountability, but it has institutional accountability, which resides in the respect it enjoys and needs. Here then is the basic point: To command the public’s respect, the court must pay attention to the public. History, says Kramer, shows this is what the justices have in fact done–even if they deny it, and even if they were unaware of it.