Congressional Leadership And Obama Reach Deal To Raise Debt Ceiling
We have a deal in Washington. Now, the leadership just has to make sure it can pass Congress.
After a day of back and forth rumors, it looks like the framework for a deal to raise the debt ceiling and cut spending has been reached:
WASHINGTON – Congressional leaders of both parties and President Obama said they have agreed to a framework for a fiscal deal that they will present to their caucuses Monday morning, moving Congress closer to taking up a measure that could pass both the House and Senate with bipartisan support and be signed by President Obama, averting a fiscal calamity.
The two Senate leaders, Harry Reid of Nevada and Mitch McConnell on Kentucky, announced the agreement on the Senate floor and President Obama a few moments later. He indicated he would support it, although it was not his preferred approach.
“It will allow us to avoid default,” he said.
All afternoon, after Senate Republicans, as expected, blocked progress on a Democratic plan, Senate Democrats and House Republicans had worked feverishly with White House officials Sunday to iron out the final components of a deal to avoid imminent default, negotiating the design of a mechanism that, after an initial round of spending cuts and debt relief this year, would help force the hand of Congress when the time comes for a second round next year.
As always, the devil is in the details and those details have not been released yet. However, this is what the framework appears to looks like:
There seemed to be broad agreement that any deal reached would include at least $2.5 trillion in spending cuts over the next 10 years, of which $1.2 trillion would be approved now. But there was intense jockeying over the terms governing the next steps, including the work of a new bipartisan Congressional committee whose members would be charged with finding more deficit reductions in time for a second increase in the debt ceiling in just a few months.
Failure by that committee would trigger automatic cuts in programs beloved by Democrats and Republicans, respectively, unless Congress later this year passed a Constitutional amendment requiring balanced budgets.
Strong balance-the-budget language has been the linchpin of support for any new fiscal plan among many House Republicans, who forced their leaders to include it last week in a bill to raise the debt ceiling, but it is anathema to many Democrats in the Senate, and in any event requires two-thirds approval in each house to take effect.
The negotiators appeared to be having a hard time defining what kind of cuts would occur at the end of the year 2012 if Congress failed to act on the committee’s recommendations.
Under the framework that negotiators were discussing today, half of those cuts would come in defense spending, while the other half would be a combination of other domestic spending, like discretionary programs and farm subsidies. Cuts to Medicare would not make up more than 3 percent of the non-military cuts. While many Republicans are loath to risk such cuts to defense, some of the more Tea Party-influenced freshmen members are less concerned with that than with getting big spending cuts overall while avoiding tax increases at all costs.
It’s no “grand bargain,” and it’s certainly not Cut, Cap and Balance, and even before the deal was announced it was already being criticized:
“This deal trades people’s livelihoods for the votes of a few unappeasable right-wing radicals, and I will not support it,” said Rep. Raul Grijalva (D-Ariz.), speaking for many liberals who head into the final hours feeling like their interests were ignored.
But Democratic discomfort doesn’t necessarily equate to Republican glee — and House Speaker John Boehner (R-Ohio) isn’t willing to push a deal through his chamber on the strength of a coalition heavily tilted toward Democrats, even if the deal leans heavily toward Republican goals.
“It’s going to be insufficient, clearly,” said Alabama Sen. Jeff Sessions, the top Republican on the Budget Committee. “I don’t like all these secret talks. We have not done anything publicly.”
Sen. Lindsey Graham (R-S.C.) said on ABC’s “This Week” that he doesn’t “see many conservatives getting behind this.”
“It is fair to say we’ve achieved a significant change in the way Washington works by paying for the debt ceiling increase and not passing it on to the credit card. We have not achieved entitlement change,” Graham said. “We have not reduced the size and scope of government. We’re going in the wrong direction at a slower pace, and for a lot of people, that is not winning.”
Sen. Jeff Merkley (D-Ore.) said Sunday in the Capitol that “if the rumors are accurate, it’s very troubling.” He cited “absence of any effort to review and trim programs for the wealthy and well connected.”
Sen. Saxby Chambliss (R-Ga.), a member of the Gang of Six and a close friend of Boehner’s, said he has “not been satisfied with what they’ve been talking about.”
Dissatisfaction from both sides is probably an indication that they’ve struck a middle-of-the-road compromise here, but the problem is going to be getting it passed if some of these opponents really dig in their heals. The Senate doesn’t seem like it will be a problem now that Mitch McConnell is on board; he’ll deliver enough votes to overcome cloture and probably to let the bill pass with as many as 70-75 yes votes. The problem will come in the House where defections on the left in the Democratic caucus and on the right in the Republican caucus are likely to make putting together a winning coalition difficult.
Starting tomorrow morning, both parties will present the details of the legislation to their respective caucuses. Then the pundits will start weighing in as well and, depending on how things go, it could be a rough road a head for the Republicans and Democrats in charge of whipping votes in the House. If they think they can get it done fast, we’ll likely see a vote tomorrow. If they don’t then it may wait until Tuesday.
For now, though, I guess we can all be cautiously optimistic. At least until we see the details of this thing.
My prediction that a deal would be struck on Monday is looking like a mortal lock.
Have fun storming the castle. Do you think they’ll make it?
A “middle-of-the-road compromise” that involves spending cuts without tax increases…my, how the goalposts have moved over what constitutes “middle-of-the-road” and “compromise”…
@An Interested Party: To be fair, this was never going to be a middle-of-the-road compromise. Still the Dem’s get at least three key things out of this (which are major compromises for *some* Republicans):
1. That there won’t be a debt ceiling vote next year.
2. The death of the BBA trigger.
3. The tying of the trigger in part to Military spending.*
The third is perhaps the most important because it could be a destabilizing issue for Republicans given the number of Tea Party aligned Freshmen who have in the past shown a willingness to cut military spending (versus more traditional “Peace-Through-Strength” Republicans who consider that budget sacrosanct).
I also look forward to Jan and Bit announcing how they Republicans gave up far too much in this deal. That’s sorta a little win for all of us.
All spending cuts in the midst of a weak recovery from the worst crash in 80 years.
Unemployment goes up immediately, and growth goes down. And it’s on the so-called Republicans and the Tea Stain.
Enjoy it everyone.
@mattb:
Sorry to disappoint, Mattb, but I really haven’t formed an opinion, because of what was earlier said about the “devil being in the details. However, it is easy to deduce that both sides were working to get some kind of deal done, in order to avoid more chaos and castigation from the electorate
There are, however, at least 70 negative votes in the democratic caucus in the House. If you add in a smaller amount of dissatisfied teas, there still may be trouble in River City in passing this tomorrow.
No matter how you want to interpret this tentative agreement, a mixture of the left and the right have the ability to be spoilers in having this get though on a 216 House vote. The Senate appears more assured.
BTW who gets the blame if Boehner delivers a majority his party’s votes, but the minority speaker isn’t able to deliver enough dem votes for the bill’s passage — specifically the progressive side of the aisle? Are many of you still going to hold tight and blame the teas? Just wondering how those of you, who spend much of the time knocking the teas as being intransigent, would process this turn of events.
@Hey Norm:
Gee, Norm, it sounds like you would be disappointed if the above scenario didn’t happen.
“There are, however, at least 70 negative votes in the democratic caucus in the House. If you add in a smaller amount of dissatisfied teas, there still may be trouble in River City in passing this tomorrow. ”
About 216 no votes are needed to prevent passage. If 70 Dems are voting against and a smaller number of Republicans are voting against, that’s nowhere near 216. Good to know jan’s sense of math is about as good as the rest of her understanding of the world.
@Hey Norm: That’s only the take from the left and “lame stream media.” Over at Fox, the story will be how the Obama administration recklessly took the nation to the brink of default so that it could throw grandma under the bus while still punishing the portion of the nation that is the solely able to generate the recovery.
Jan…
When it happens, be sure to admit that it’s what you wanted.
BTW, Everyone,
This whole debt limit debacle could have been avoided, had Reid brought this debt ceiling up in the lame duck session last December ’10, where he had all the votes ever needed to pass this thing.
Reid’s taped response, though, was that he wanted the republicans to share in the debt blame, which is why he waited until ’11 to take it on. It’s all about poltical advantage isn’t it, no matter which side of the aisle you’re talking about. That’s why some of the anomosity shown from the left to the right, and the right to the left is full of hypocrisy, and consequently becomes almost humorous, if it wasn’t so serious.
@Moosebreath:
…there are more than teas or progressive dems in the House. And, those votes, nobody knows about. The main theme of my comment was not to be a precise math equation, but to show that the House is not a sure thing. As the pundits are saying, “Anything can happen.”
I live in DC and have never heard “River City” before…is that a new one? and old one? or am I just out of touch?
@Hey Norm:
Norm,
I have family members who have small kids and both husband and wife cannot find any employment. What I want is for the economy to improve and for frustrated unemployed people to find a job. My disagreement with some of you is the process in which I think that can be done.
And what makes you think there won’t be a larger amount of “teas” voting against this? As for Democrats voting no, Nancy Pelosi has far better control of her caucus than Boehner does of his, so whatever direction she decides to go in will be where most of her caucus will follow…
Happy to be of help…
As if spending cuts during a recession will improve the economy and actually help people to find jobs…
We already know that Boehner can’t herd his cats – I guess we are about to find out if Obama can herd his.
@jan: Even when the Dems had 60 votes they didn’t -there were several conservative Senators that vote with the Republicans more than the Dems. All this talk of the Senate not doing anything disgusts me – you can’t get anything done when it takes 60 votes to do it.
So Jan…
Tell me how slashing spending, which will increase unemployment and slow growth, achieves that? You have argued for spending cuts. That practically guarantees your family members will have it worse for longer. Good luck with that. You asked for it.
@An Interested Party:
We obviously disagree on the means to the end — the end being job creation. You believe in tax hikes, and I see stabilizing and cutting back on our debt as a vital component of getting out of our economic malaise.
I agree with Ron B. that Boehner is going to have a tough time with his House members. While Pelosi is a tougher leader, in this department, I think she has her hands full too with her progressive caucus. Although, what Pelosi does is threaten the members who don’t follow her, telling them they will get no financial support for their reelection bid if they go against her. I suppose the republicans must do the same thing. But, it isn’t as publicized.
“… I see stabilizing and cutting back on our debt as a vital component of getting out of our economic malaise…”
How exactly does that work? Details. C’mon.
No, stabilizing and cutting back on our debt will require cutting spending and raising taxes, both of which could be dicey during our current economic troubles…
Umm, actually it is…
@Hey Norm:
I started writing a belabored post explained my reasoning why lowering the debt was important in stabilizing our economy –hence providing a better hiring atmosphere. But, much of what I would say is part of how I conduct my own business, my view of what errodes or increases confidence in the market etc. You, in turn, have your own POV, and I cannot see it being changed, or even softened, by anything I would say.
So, I deleted it. Time will tell who is right on this point.
@An Interested Party:
I had heard that Jordon was not racking up any points with Boehner. But, did not see that link you provided. However, nothing really surprises me as to how cut throat DC can be. It’s reminds me of being in high school, the clicks, the grudges, and bullying that oftentimes goes on in adolescence.
Dissent is appropriate. However, leaning on people, by some hierarchy, to do what you want them to do is not something I particularly admire anywhere in life.
Jan…
No one is hiring until there is DEMAND.
This deal weakens demand.
That’s why you deleted what you wrote…because you realized I’m right.
But you and the Tea Party got what you wanted.
Good for you.
But I feel bad for your un-employed family members.
In the meantime, the NYT muses that this deal may avert default, but some ask is that good?
@Hey Norm:
Norm, the only thing I’m going to agree with you on is the right to disagree.
This speech has gained a lot of attention/traction, around the country. I just heard and saw it a few minutes ago, and IMO the Senator articulates the problem about as well as anyone has.
He also expresses the basis for dissent over just passing a clean debt ceiling bill, versus passing one that actually shows an intent to decrease the debt, at the same time. In other words, this debt ceiling event is deemed by many as an “opportunity,” not just a automatic procedural remedy.
A Good way to cut spending – End the Global War On terror:
Blair notes we are spending about 20 million dollars a year per head to catch or kill each of the 4,000 al-Qaida members.
Right, it was an anti-democratic opportunity to threaten the nation in order to leverage getting policies enacted that the GOP didn’t have the elected officials in power to pass any other way. It was an end run around the democratic process that had elected a Dem President and Senate, basically telling those voters, “FU for playing by the rules of our democracy.”
At one point I even caught a Tea Party politician on on Greta Van Susteran saying they need to keep the dept ceiling increases short so that after they used it to “pressure” 2/3 of the congress into passing their constitutional amendment they’d next use it to “pressure” the states into doing the same.
It would appear that Obama is no better at herding cats than Boehner.
Pelosi: ‘None Of Us’ May Support Debt Limit Deal
That you, David Stockman?
The deal seems to be upsetting all the right people.
@Ron Beasley:
Wasn’t that Pelosi statement from a couple hours prior to the President saying the party leaders in each house had signed on? I’d be shocked if minority leader Nancy Pelosi has any trouble getting the number of Dems Boehner needs (I think he still wants to have it pass with the majority of votes being Repubs).
@Jeremy R: I’m still not convinced that Boehner can get a majority of Republicans – they are terrified of the teabillies. I’m also not convinced that Obama/Pelosi can bring around enough Democrats to make up the difference. This is a lose lose for the US.
It’s widely reported that the debt ceiling will require no further raise until after the 2012 elections.
I’ll feel much better once I’ve learned whether that means after Jan. 20 2013…or sometime shy of it under the lame duck term of the Congress–and potentially lame duck White House.
I do hope some media types get around to researching and clarifying this.
@qtip:
You’re culturally illiterate…
It’s a reference to a famous song from The Music Man
@Ron Beasley: If only we could count on Obama manning up and challenging the Congress to stop him from raising the debt limit under the 14th Amendment, then I would be happy if it didn’t pass either chamber. But unfortunately, we don’t have a leader in the White House.
@Anonne: Ann Althouse has taken apart the “14th Amendment” theory. And while Obama was a Constitutional law lecturer, she’s an actual Constitutional Law professor, with an actual published history of scholarship. Not only that, she has common sense and semantics on her side.
The Amendment says the “validity” of the debt cannot be questioned. When you cannot pay your bills, you aren’t denying that you owe the money, you just can’t pay it. So default isn’t about the validity of the debt at all. Plus, at the time, the intent of the amendment’s authors was to keep future Congresses from renouncing debt that the Union piled up during the Civil War.
Fun theory, won’t work. Sorry.
J.
@Jay Tea: Sorry Ann Althouse is irrelevant – all that matters is what the SCOTUS does. Obama wins in that court.
@Jay Tea:
Yeah, yeah. I’ll see your Ann Althouse and raise you one Jake Balkin. It would be the politics that are important here, not some fancypanties theory of the 14th Amendment. I thought you were smarter than that.