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Tag: debt ceiling debate

Republican Business Lobbies and Tea Party Disagree On Debt Plan

The debt ceiling debate continues to reveal a deep rift in the the Republican Party between the business elite (including former Bush Administration officials who raised the ceiling without controversy or chaos) and the grassroots, anti-establishment Tea Party base. The split — which pits a single-minded focus on keeping business running smoothly against a single-minded focus on bringing the federal government to its knees — was previously masked by a unified front of opposition to Democratic policies such as health care reform and stricter environmental regulations.

On Tuesday, the Chamber of Commerce sent a letter to Congress encouraging them to vote for Speaker of the House John Boehner’s plan to raise the debt ceiling for six months. But the Republican Study Committee, a group of over 170 conservative members of the House, announced that they opposed the bill. Rep. Jim Jordan (R-OH), chairman of the Republican Study Committee, doubted that Republicans would accept the plan. “We think there are real problems with this plan,” he told the AP. Michele Bachmann, presidential candidate and chairman of the Tea Party Caucus in the House, continues to oppose all attempts to raise the debt ceiling.

Instead of Boehner’s plan, the Republican Study Committee supports the Cut, Cap, and Balance Act, which has already passed the Republican-dominated House but has no chance of passing the Senate. The Cut, Cap, and Balance Act is a darling of ultra-conservatives and Tea Party lawmakers because it forces Congress to pass the Balanced Budget Amendment — an amendment to the U.S. Constitution that would require massive cuts to entitlements and social welfare programs like Medicare and Social Security — before raising the debt ceiling. Boehner’s plan requires a vote on the Balanced Budget Amendment after the debt ceiling has been raised, but does not require Congress to pass the amendment first. This does not satisfy conservatives in the House, who prefer the pure vision of the Cut, Cap, and Balance Act. “The Senate should resume debate on the Cut, Cap, and Balance Act, amend it if necessary, and pass it, so we can provide the American people a real solution,” Rep. Jordan said in a statement

The Chamber of Commerce, on the other hand, is more concerned with protecting the interests of Big Business than fidelity to ultra-conservative ideology. In 2008, they supported Obama’s stimulus package, which most grassroots conservatives fiercely opposed. And now they support Boehner’s plan to raise the debt ceiling and avoid the government defaulting on its debt. In a letter sent to Congressmen on Monday, they underlined the severe risks to the economy of such a default. “A default on the obligations of the United States,” the letter reads, “would most assuredly cause severe, immediate, and pervasive economic harm ” and “political brinksmanship is no longer an acceptable strategy for either the White House or congressional leaders.” The Chamber may not be thrilled with Boehner’s plan, but they are not willing to oppose it and risk default.

It may turn out that none of this matters. Obama has already promised to veto the Boehner plan since it only raises the debt ceiling until December, which would force put the government into the same situation it’s in now — legislative gridlock and a real threat of default — in six months. Obama has pushed instead for Senate Majority Leader Harry Reid’s plan, which raises the debt ceiling through 2013.

Meanwhile, the latest polls show that most voters (86%) are worried about the consequences of default, and a majority (56%) believe that a plan to reduce the deficit should include some spending cuts and some revenue increases — which both business-friendly and Tea Party Republicans strongly oppose.

Obama Can’t Celebrate Yet

WASHINGTON — The wounded are especially dangerous fighters. President Obama now occupies the high ground in the debt-ceiling debate, having called the Republicans’ bluff on the debt. He showed that deficit reduction is not now, and never has been, the GOP’s priority. He dare not get overconfident.

After thwarting the deal that House Speaker John Boehner was cooking up with Obama, Rep. Eric Cantor, the majority leader and Boehner’s rival, needs to show he knew what he was doing and recoup political ground. Cantor is likely to present Obama with spending cuts that the president once seemed to endorse as part of a large deal but will have to reject now that the big agreement is dead. There is still a lot of danger out there.

But it’s already clear that history will show that Boehner, the old war horse, was a better political calculator than Cantor, the self-styled “young gun.” Boehner saw an opportunity to make huge cuts in entitlement programs, shake off the severe damage done his party by Rep. Paul Ryan’s budget, and ignite a war between Obama and the Democratic base.

Boehner made what, in the larger scheme of things, were modest concessions on tax increases, getting three times as much in spending cuts. Only House Republicans can think that three steps forward and one step back constitutes retreat. Boehner lives in the real world. Most members of his caucus live in Foxland or Rushville, where talk shows define the truth.

Obama thought solving a big problem would outweigh any political difficulties his deal with Boehner might cause him. But Cantor saved Obama a lot of trouble. He protected him from a bitter intra-party fight and made crystal clear that preserving low taxes for the wealthy and for corporations is the GOP’s driving objective. Even the most resolutely centrist and cautious have been forced to concede this essential truth of American politics.

Senate Republican leader Mitch McConnell — he’s astute like Boehner, but less interested in policy — signaled on Tuesday that this whole adventure of tying a debt-limit increase to the quest for big spending cuts has become a losing strategy. His convoluted but clever proposal would make Democrats take all responsibility for increasing the debt cap. This gets the GOP out of its current box and forces Democrats to cast a lot of unpleasant votes. That would help Republicans take over the Senate in 2012, which is what McConnell cares about most.

Thus has the GOP forced its way into a sentence on which Democrats once held a monopoly: Yes, Republicans are in disarray. They’re divided among those who know Boehner was right, those like McConnell who want to get out of the debt-limit mess altogether, and the troika now running Republican House strategy (Cantor, Ryan and Rep. Kevin McCarthy) who need something to show for having brought the country to the brink.

The best way out of this impasse is, unfortunately, a political nonstarter: to work with the budget crafted by Sen. Kent Conrad, D-N.D., which shows you can get a lot of deficit reduction by mixing some spending cuts with higher taxes on the very wealthy. It’s a road Obama might usefully have considered earlier.

The rational alternative is a deal with enough cuts to satisfy a majority of Republicans and enough revenue to win over a sufficient number of House Democrats to make up for tea partiers who’ll never support a debt limit increase. If Boehner reasserts himself, that’s probably where things will go.

Here’s the worrisome scenario: Cantor takes every domestic spending cut that was discussed as part of the negotiations with Vice President Joe Biden, declares that the administration has blessed them, and packages them together for a vote.

Never mind that Cantor walked out of the talks before there was serious negotiation about defense cuts and revenues, and thus no real agreement. Cantor, who needs to embarrass the Democrats and pull Obama down from the commanding heights, was shrewd to get the administration talking early about cuts in domestic spending and to put a lot of its cards on the table. He can now play those cards against Obama by forcing the president to reject reductions he had once considered when a larger agreement looked possible.

This might look like a political game. But at this stage, House Republicans can’t afford to end this whole sorry episode with a whimper. The bang they are looking for could yet cause a lot of collateral damage.

E.J. Dionne’s email address is ejdionne(at)washpost.com.

(c) 2011, Washington Post Writers Group

What Cantor Wants

Most people don’t think about their high school yearbook quote much after age 18. But Eric Cantor, the U.S. House majority leader, chose a quote 30 years ago that seems particularly prescient given the ongoing debt-ceiling debate: “I want what I want when I want it.” The lyrics from a Henry Blossom operetta appropriately describe Cantor’s drive – his ambition is so great that some have wondered whether he has his eye on John Boehner’s job. Cantor’s advisers insist he’s not aiming for the speaker position, despite the fact that he dramatically walked out of debt-reduction talks last week and thereby stalled negotiations. As the nation faces financial chaos and possible default, perhaps someone should tell Cantor some different lyrics: “You can’t always get what you want.”