Showing posts with label debt ceiling. Show all posts
Showing posts with label debt ceiling. Show all posts

Thursday, December 19, 2013

Hard decisions for the GOP, again!

So both Paul Ryan and Mitch McConnell are making noises about putting up a fight on the debt ceiling increase. One problem--they haven't decided what to demand yet. This is so much the same as earlier this year when the GOP met several times trying to figure out their strategy, and basically ended up with a strategy vacuum that was filled by Ted Cruz's "Defund Obamacare" fiasco.

Probably the GOP will plump for the a different fiasco this time. Just maybe they'll figure that a half-baked idea is worse than nothing at all, and will instead think through their position. Do they want to push for some more spending restraint? Entitlement reform?

They better decide damn quick because it's only 2 months until the debt ceiling is reached, and they can't be unveiling their position one day or one week before the deadline. The GOP looked incredibly stupid with their changing slate of ridiculous demands just before the government shutdown, so the GOP should know not to do that again.

But the problem has always been that having demands isn't enough. You must have specific, sensible demands. If the GOP wants spending cuts, what the hell are they? Is the pain balanced, or targeted only at their political enemies? It's going to be easy for Obama and the Dems to say "no negotiations" to a half-baked list of demands, but much harder if it's a well-considered plan. This should be obvious by now, but the GOP opinion leaders (the noise makers with their legions of dittoheads) are too cloaked in the conservative thought bubble to have noticed it.

I hope that the GOP decides on a small slate of targeted spending cuts. It's doable and they can run a PR campaign on it. There are rumors that they'll try to get some entitlement reform, but they aren't close to ready for that, with the exception of chained CPI. Entitlement reform will take a lot of heavy thinking from a bipartisan commission like Simpson-Bowles or the 80's Greenspan Commission. There's no way the GOP can get any meaningful entitlement reform in the next two months, so why the hell are they pretending otherwise? Again, it makes them look like ridiculous amateurs.

Meanwhile the Dems are just sitting back, letting the GOP shoot themselves in the foot. They're taking advantage to a small degree, but not enough to look greedy and untrustworthy. Somewhere along the line, the Dem leaders learned not to overplay their rather weak hand--not because they became responsible adults, but because they got their asses handed to them in the 2010 election. They learned how quickly the country will turn on them. The leaders learned, that is, not the noisy social justice element. Those guys still think the congressional Dems can play hardball to increase social spending and taxes. Some people never learn. Isn't that the truth.

Rushing to the next tactical mistake
Image: politico.com

Saturday, November 23, 2013

Debt Ceiling 201

This is the follow-up on the short post about why reaching the debt ceiling wasn't the rosy picture painted by some Tea Party wishful thinkers. I said that there was 1) no legal framework for prioritizing government payments (and thereby avoiding default on debt service) and 2) no practical mechanism to do it at this time.

No Legal Framework

The US government hasn't intentionally defaulted since FDR's presidency. Even then, that was a planned default, which is not what the Tea Partyers want. They want prioritized payments of US obligations to avoid default and do the least harm to the country.

No such prioritization has been established, so this is new territory. There aren't laws laying out how to do this. In the absence of such laws, who will decide what the priority should be? That's a huge constitutional question. Does the president unilaterally decide since he's the executive? Does the Congress decide? Can Congress impeach the president for making unilateral decisions? Can Congress impeach the president for refusing to prioritize payments? Will the Tea Partyers who want the prioritization of payments guarantee that they won't call for Obama's impeachment over the decisions he makes in this regard? I sure haven't heard anyone making such a promise.

Will Congress quickly pass the legal framework required? HAHAHAHAHA.

No Practical Mechanism

All the accounting programs, sign-offs, clearances, etc. that it takes for the government to send money to the correct people are probably much more complex than anyone's monthly disbursements. How readily can that all be changed to send out prioritized payments? Not readily, I'd bet. There would need to be an entire design/implementation cycle with the requisite planning, programming, testing, bug-fixing, and retesting.

Political Motivation (1)

Now that the practical considerations are out of the way, let's consider the motivations of the parties regarding prioritized payments. For Tea Partyers, the motivation is to prevent default, incur no new debt, and pay the most important government expenses. However, there isn't strong agreement on what the most important government expenses are. That's one reason not to leave the decision-making unilaterally to the president, just in case he's a scum-sucking, pinko, socialist bastard.

So those who support prioritized payments will probably also want a big say in determining the priorities. But again, there is no legal framework at this time for that. Congress would need to follow the usual law-making procedures--but the chance that the House, Senate, and president will pass one prioritization plan is so close to zero, it is effectively zero. So there will be no prioritization in established law.

I've never heard any proponent of prioritization discuss this wrinkle in their plan. I'm guessing that they gloss over that impediment, and imagine that their priorities are so obvious that they'll be followed. Then, reaching the debt ceiling is equivalent to immediately going to a balanced budget. By refusing to raise the debt ceiling, they achieve one of their biggest policy goals. And they didn't even have to pass a balanced budget law or amendment. Hooray! No wonder they gloss over so many details.

So if priorities could be established, Tea Partyers have another way to achieve a major goal--just don't ever increase the debt ceiling. That's a lot of added leverage for them in any budget negotiation.

Political Motivation (2)

What is the political motivation of the Democrats, including the president? They aren't for an immediate balancing of the budget. They aren't for establishing spending priorities at a much lower budget target point. They don't want the Tea Party to have greater leverage in budget talks. Their motivation is to make the debt ceiling as painful as possible, so that the GOP will always back down.

In this, they have history on their side because the debt ceiling has always been increased. Neither Congress nor the president has ever stepped over that line, because it would be too catastrophic a move to make. The US government would go into default, which would destabilize the world economy and probably cause a worldwide depression.

The Democrats have no reason to make the debt ceiling less scary. That hands leverage to those who want severe budget cuts, which are not the Dems. So there's no way that the Dems will pass any legislation that prioritizes payments in the event of reaching the debt ceiling.

Wonderland Scenario

Maybe the next time the GOP controls the House, Senate, and presidency, they can pass the legislation and build the accounting mechanisms to implement prioritized payments. That will be somewhere on their list of must-have legislation including the repeal of Obamacare, rolling back regulation, closing the EPA, block-granting Medicaid or just getting rid of it, outlawing abortion, and ushering in the permanent GOP majority.

Maybe, like Rip Van Winkle, I'll go to sleep for two decades, and then wake up to a US where all this has happened. Somehow, I doubt it, but we'll see. Nighty-night!

Come on, it's simple.
Image: archiscene.net

Sunday, October 13, 2013

The Greek tragedy of the GOP in tweets

I'm not gloating over the disarray for the Republicans. Hardly, since I value them as a counterweight to the excesses of the Dems. So I'm deeply saddened by how the GOP have tripped themselves up, and made poor choices one after another. Well, to be honest, I've had moments of schadenfruede watching stupid posturing crash and burn, but the lesson overall is a sad one.

The tweets of Robert Costa capture this poetically. Start with this one from 10/12/13 at 11:01am and continuing reading:
"GOP sens very worried that the longer this stretches on, hour by hour, and poll #s sink, Schumer & Co will push for more R concessions" [which is happening today 10/13/13]
"Handful of GOP sens + their aides believe Boehner fears losing his power if he brings up Collins-esque package and it gets 30% R support"
"I was surprised to hear how many Senate R power brokers are furious w/ Boehner's posture at conf today, think he's not being frank w/ membrs" 
"another notable convo in Sen this morn: Rs warning Schumer, Ds that if they truly break Boehner here, possibility for any big leg[islation] fades..." 
"So [Boehner]'s stuck. No "out" that can win big House R supprt, pass Sen; if Sen plan comes to H floor, it'd get D maj, but few Rs, break his gavel" 
"As House anger builds, clock ticks, House R ldrshp digs in, rushing a bill to floor. Sen Rs nervous abt contours of emerging Sen deal"
"House makes WH an offer, WH rejects. Priv talks on CR stall. Sen watches, sighs, starts its own talks. House becomes angry w/ WH & Senate" 
"There is a growing acceptance in Hill GOP that regardless of how this ends, it'll end badly, and Rs who back it will be blamed for caving" 
"in short, growing # of Rs could care less about a con$ervative group's threats about not being Cruz-esque/CR warrior when BCA '11 at risk" [BCA = Budget Control Act aka sequester] 
"polls have dipped, House in disarray, Sen Rs on ropes. Now, cries/anger of Right fading, seem minor as hardball of Sen Ds rattles them"
There is no need for me to comment. These tweets say it all.

...Now, cries/anger of Rignt fading...

Image: danielwarner.blog.tdg.ch


Wednesday, October 9, 2013

GOP wants negotiations, eh? Part 3

Here's how we'll know when the GOP are serious about negotiations:
  • They'll pass a Continuing Resolution and debt limit with no strings that will last at least two months. This will give time for negotiations without giving away leverage for an eventual deal.
  • They'll approve a conference committee. That will show that they're willing to vote straight up or down on the results of the negotiations, with no filibuster or other blocking maneuver by the Tea Party caucus.
  • The leadership will shut up about defunding or delaying Obamacare. At this point, they've mostly ended these attempts, but it's a negative sign if they start up again.
Here are signs you won't see so don't expect them:

  • The GOP will sound more conciliatory. 
  • Tea Party republicans will relent.

These developments are necessary to move ahead with negotiations. The GOP are going to be very pissed. However, horribly angry politicians still manage to make deals, so I'm not giving up hope even if both parties sound a billion miles apart and express utter contempt for each other. That will be the same situation as in summer 2011, which was the last difficult deal the parties made. (Who would have thought I'd look back longingly for those days?)

It's unlikely that the GOP will become serious all at once. There will probably be a short debt ceiling deal first, maybe just a few weeks. The next extension for a longer period will herald the onset of serious dealing.

Here is something I wish the GOP would realize: they've operated with just two approaches to divided government. The first was negotiation amid intense acrimony. The second was confrontation without negotiation. The first approach resulted in the Budget Control Act of August 2011. The second approach has resulted in the capitulation by the GOP. So, really, for the GOP, the choice is negotiation or humiliation. Why is this such a hard choice for them?

Image: therpf.com

Wednesday, October 2, 2013

Day2 roundup: GOP plan, maybe. Tea Party plan, no.

So two days into the government shutdown, where are we? The GOP still seems to be scrambling around for a plan, but perhaps there are glimmers of one. Robert Costa, reporter for National Review, seems to have the best inside information. I've been reading his tweets since about 10pm on 9/30/13, and it's interesting. He seemed to learn very quickly what the House leadership's next move would be, like the ridiculous call for a conference committee to work out a deal in, oh, 1 hour.

So this morning, Costa tweets that Paul Ryan is going to try for a combo dealing covering both funding and debt limit, that will be "fiscal." What does that mean? My guess is that negotiations will focus on budget issues, particularly spending cuts to lower the deficit. Delaying or defunding Obamacare won't be the focus.

But wait. Early this afternoon, Costa tweets that the leadership will follow the Cruz strategy of funding everything piecemeal--probably everything except Obamacare and the EPA.

Nope, that didn't last. Mid-afternoon, Costa is tweeting again about Ryan being the lead bargainer on a grand deal. Again, there's nothing about Obamacare in this.

Does the conservative press know about this? I checked HotAir. They're referring to Costa and Politico, and speculating that maybe Ryan can pressure the Dems on Obamacare, or maybe he'll go for a more "traditional" fiscal deal. Meaning--like the sequester, which didn't touch Obamacare.

At Breitbart, a no-name columnist wants to keep the Cruz plan, but it's not a forward-looking column about what could or will happen in the next few weeks--so no plan there. TownHall, NewsMax, nothing on the Tea Party plan. Only at RedState, Erickson wants go back to defunding Obamacare and threatening any non-compliant Republicans with oblivion. It will work!!!!!!

What are the Dems doing? Waiting for the Republicans to sew themselves together into a semblance of a political force and make their next proposal, which hopefully will make more sense and last longer than the three four throw-away GOP proposals of Shutdown Eve.

Image: huffingtonpost.com


Extra. Belatedly in honor of Ted Cruz:

Image:  hyenacart.com

Thursday, September 26, 2013

Roundup: Still no Tea Party Plan

So the House surprised watchers by sending a hopeless funding bill to certain dismemberment in the Senate. The Senate even has a timetable for the dismemberment (Cruz yaks on Tuesday through Wednesday noon, cloture vote Wednesday, strip out Obamacare defunding Friday or Saturday, pass it, send it back to House for possible rinse and repeat). The Senate, anticipating the reaction from the House, might make it a short term funding bill only through November or December.

What is the Tea Party plan now? I went looking for it, inspired by Bernstein's very detailed guess about what would be happening in the House concerning the continuing resolution and debt ceiling votes (worth reading).

So this is what I found.

HotAir is telling its TP audience that Boehner's response will be a bill to delay Obamacare. HotAir warns that there will be a shutdown, but that will just light a fire under the lazy Senate.

Several voices are telling Tea Partiers that it's hopeless. Since they lost the election, Obamacare is going ahead and it can't be defunded. When John McCain tells them, the TP is defiant. Erick Erickson at RedState is defiant. He seems to think Cruz has a plan, but forgets to say what it is. At Breitbart, a columnist with that reality message is labeled a progressive, and the message is derided. Elsewhere at Breitbart, it's hooray for Cruz.

There are no signs that the Tea Party has a plan and even realizes the need for a plan. There's no discussion that "we do this, then they'll do that, then we'll counter with this." Nothing like that at all. These people are absurd in their lack of awareness that other people exist and have power. How did they get to be so oblivious? Jennifer Rubin, who is usually worthless, explains that they wrongly extrapolate their media share.

So are there any indications of what the Tea Party will do next? No. However, the ball will soon be back at the House, so the House leadership is trying to figure out its next move. They haven't ironed it out yet, as time ticks away to October 1. Politico reports the next House bill might delay the implementation of Obamacare. That would be another hopeless volley, and shutdown would follow. Perhaps the Washington Post report is more accurate--that the House might do something with a debt-limit increase and lots of sweeteners for GOP causes. It's not reported what the plan for funding is.

So it's all as clear as mud right now, 4.5 days away from the end of statutory funding. Thank you, Tea Party.

Image: citizenchris.typepad.com


Same day update: A preview of the proposal from the House shows one aspect of the Tea Party plan. They plan to make the fight as bloody as possible in non-contact politics. See the likely new demands. The Tea Party will be stabbing and nicking anyone who isn't a complete supporter. And they've invited their ravening friends to watch.

Update 9/27/13. Still no plan. House GOP to meet Saturday.

Sunday, July 14, 2013

GOP sets the table for a debt fight

I haven't been hearing previews of the next big fiscal fight between the Dems and the GOP. If you recall, the GOP keeps saying they're going to stand firm and make the Dems give ground in exchange for an increase in the debt ceiling. Then each time the GOP capitulates. Well, at least that's what's happened every time after their success in August 2011.

But this time will be different, the GOP leaders swear. Let's just check on that. Hmm, it seems that the GOP has a menu of concessions it wants. They want entitlement reform based on Paul Ryan's formula (yes, that losing formula). If that's doesn't lure Obama into a deal, there's tax reform along GOP guidelines. Further down the menu there's a demand that Obama gut Obamacare and/or approve the Keystone pipeline.

There's a huge problem in the GOP plans. They amount to inviting Obama to come to a table to eat crow. But Obama doesn't have to eat crow. If the GOP wants a negotiation, it needs to set out more tempting options, and they need to be more pleasant dinner company. However, the GOP isn't ideologically ready for that, so it's acting to type.

Here's what will happen: Obama will call the bluff, not negotiate, and also show that the GOP isn't negotiating either. The debt ceiling will approach, and (say it in unison) the GOP will capitulate.

The GOP isn't actually getting ready for a fight or a negotiation. If they were, they would be doing a media blitz on their ideas in an attempt to gain momentum in popular opinion. They aren't doing that, so there won't be a swell of support that pushes Obama to the table. He can simply resist, and let the concerns about government shutdown overwhelm the GOP position.

This is so obvious to me, and I'm no guru of political analysis. Why isn't it clear to the leaders of the GOP? I've got to conclude that they know they're in a stalemate, but they're trying to keep morale up. In the end, they'll declare victory in stopping Obama from raising taxes. Very likely they'll also have the fig leaf of appropriation deals that keep the status quo going one more year. Hoorah for our great heroes!!!

The wonderland of GOP negotiations
Image: democracyforvancouver.org


Extras. The author of this article discussions the GOP strategy. She also predicts that immigration reform will happen in the House after it's too late for primary challenges.

My apologies for this additional boring installment in my series about our frozen politics. My point--no major changes, status quo budgets. Yawn.

Sunday, January 20, 2013

Good news from the GOP, Part 1

So while I was writing that the GOP was pretty quiet about their debt ceiling strategy, they were in Virginia discussing and changing that very strategy. I won't spend a lot of time discussing the new offer, but it's roughly this:
  • The GOP will vote to extend the debt ceiling for three months.
  • The intention is that during that period, the president will present his budget, and the House and Senate will debate it.
  • If no budget is passed after three months, the Congress members no longer get paid.
That plan doesn't sound like much, but it's still quite a step forward for the GOP. For one thing, they recognized that they had a problem many weeks before breaching the debt ceiling.

The problem: They had no rationale for holding up a debt ceiling increase because they had no alternative plan on the table. So far, their new strategy is about as thin as it was before. The president will have to present his budget, which has almost no chance of passing, and then... Well, that's where the current non-plan looks like the previous non-plan.

So it's best for them to punt for a few months and build a strategy that they can present. Nonetheless, the Republicans have recognized the problem and seem to be working seriously on it. That's usually the hardest step. I'll be watching for them to deploy the rest of their new strategy.

The new GOP strategy? Obama's budget? Something even better?
Image: afuitbs.com

Extras. And here are some suggestions for the GOP from its own camp:
  • Allahpundit sees the three-month as same-as-now.
  • Our commenter, Truth > Spin,  pointed to this idea-- Hennessey's shrinking-room suggestion.
  • Krauthammer recommends going with small demands so the Dems can't say no.
  • The statement by Eric Cantor, who seems to be the point person for the change.

Preview of Part 2 -- I'm not completely sure. More ideas are percolating, some of which have already been written, edited out, and are likely to be tossed. But it was important to me to post about this significant development before it got any later.