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What will debt ceiling victory look like?

What will debt ceiling victory look like?

I’m only able to follow today’s debt ceiling posturing and bickering on an infrequent basis.  Looks like Repulicans are looking for a single or double, something along the lines of modest spending cuts with no tax increase, with the 2012 presidential election to be the home run derby.

Will that be victory?  It does change the narrative for the 2012 campaign from do we cut to how much we cut.

Considering that a true restructuring simply isn’t possible with Obama in the White House and Harry Reid in charge of the Senate, isn’t that victory under the circumstances?

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No tax increases. Debt Ceiling increase with spending cuts in this years budget. If you want to know what defeat looks like, look at the McConnell plan. (However Grover Norquist on this morning’s Morning In America with Bill Bennett thinks differently)

How long, O Lord?

Condemning my grandchildren to a live of tax-slavery is NOT ‘victory.’

You can do whatever you want with YOUR grandchildren, however.

Well, if it forces Obama to advocate for either tax increases or and/or ceiling increase just before the next election, it will be a victory.

There will be no victory for the American people; it looks like the leaders in DC of both parties are only interested in the outcome that best serves them, and not us.

That being said, I would like to see the House pass the Cut, Cap, and Balance Bill. Let the Senate and the White House shoot it down and take the consequences.

Each one of us should be calling our Congressional Representatives with a 3 word message: CALL OBAMA’S BLUFF.

“Considering that a true restructuring simply isn’t possible with Obama in the White House and Harry Reid in charge of the Senate, isn’t that victory under the circumstances?”

Answer – No, No, No and No!

The Republicans have the House and if they stick together they can STOP anything they feel isn’t in the best interests of the nation. And that’s exactly what they should do if Obama fails to come up with very significant cuts. A modest increase in the debt ceiling would be ok under the circumstances, and to reinforce that they are willing to compromise. Beyond that, they should simply thwart any attempt to increase spending and if that causes a shutdown – they should say that a shutdown is much better than bankrupting our nation with further irresponsible spending.

I would be totally ok with a shutdown under those circumstances if they simply make the message that clear and have the balls to stand behind it. I think the people are looking for Congress to be equally as tough (or more) with their message as Obama is with his.

    JayDick in reply to Ipso Facto. | July 18, 2011 at 4:28 pm

    What effect do you think a shutdown would have on the 2012 election? I think it would ensure Obama’s reelection. Whatever bad happens after the shutdown, Obama would successfully blame Republicans, even if the problem is his fault. Remember, reality doesn’t count; only the voters’ perception of reality.

    If Obama is reelected, our country is doomed. Defeating him in 2012 has to be job one.

Woops – When I looked, my comment to this thread got posted to “The Homeless” thread, so………

…A complete one? Easy.
The Harding-Coolidge 18 month Recovery from the quantitatively worst Twentieth Century American Depression, the “1920 Depression” that was a reaction against and end of “The Progressive Era”
http://www.calvin-coolidge.org/html/the_harding_coolidge_prosperit.html

But also
http://blog.mises.org/11102/the-forgotten-depression-of-1920/

http://mises.org/daily/1597
and
http://mises.org/daily/4882

Lest it be said I’m going “Off-Topic” the smaller scope of the question the best outcome would be a Lowering of “The Debt Ceiling”

In a more serious vein the real purpose of the current administration is to Lever Up the “Baseline Budget” numbers,
thus satisfying the Washington Insiders of both parties.

Since neither side has an interest in “Maximizing Revenue” [Which is the practical side effect of applying “Hausers Law” http://www.hoover.org/publications/hoover-digest/article/5728
]
then I have to take George Will at his word, the insiders do NOT have any interest in making government smaller faster cheaper in contrast with what they say.

Geithner makes it sounds as if the Republicans are now on board for a “balanced” package – i.e., bump the cap, do some lightweight cutting, and do a tax increase.

http://pointsandfigures.com/2011/07/18/tim-geithner-chilling-interview/

He’s such a smarmy-sounding guy.

If you read the S&P downgrade warning from last week, any deal that does not address the debt problem over the next ten years and reduce debt by at least $4 trillion will not be viewed kindly. The McConnell punt will lead to another S&P warning.

I can already here Republicans running next year complaining about Obama’s McConnell Plan. Failure across the board but bipartisan.

    JayDick in reply to Pasadena Phil. | July 18, 2011 at 4:30 pm

    McConnell’s plan has one very big advantage. It would fix the blame for the bad economy squarely with Obama, ensuring his defeat in 2012. Only then can we start to fix the mess we are in.

      Ahem…. the MCCONNELL plan. MCCONNELL! Republican! Why would that “pin” the blame on Obama?

        WarEagle82 in reply to Pasadena Phil. | July 18, 2011 at 7:47 pm

        I really don’t think the TEA Party movement is going to buy the “McConnell Plan” BOONDOGGLE as anything but another abrogation of responsibility and betrayal of the Republic.

        This isn’t going to fool anybody and the elitist Republicans conspire with Marxists to pretend to fix the debt problem yet again it is going to lead both parties further down the road to irrelevance.

        JayDick in reply to Pasadena Phil. | July 19, 2011 at 6:59 am

        The plan does not raise the limit. It allows Obama to increase the limit. That makes him responsible.

        It also does nothing directly to affect the economy. That puts all the responsibility for the economy on Obama despite his increasingly feeble efforts to blame Bush.

        Remember, in politics, truth and accuracy are irrelevant. All that counts is voters’ perceptions. Obama understands this. Republicans do not.

In the future, the debt ceiling should be tied to GDP, then if a president wants to spend more he/she needs to increase the size of the economy.

But yes, the GOP doesn’t have enough leverage to get what it really wants, and I’m starting to think putting this behind us as an issue ASAP while not capitulating is the best course of action. This debt fight isn’t going to matter in the grad scheme, but framing the issues for next year will make a difference for the rest of our lives and beyond.

Prof’s suggestion modified by: short term debt-ceiling raise, coupled with dollar for dollar read spending cuts implemented by September 2012. That would get something done for the U.S. and give Obama and his democrats bloody noses.

    Nope. Doesn’t address the debt (not deficit, debt) issue nor any of the points S&P brought up. It’s like former NH senator Judd Gregg said this morning, DC is driven completely by 2012 presidential politics. They are not going to do the right thing economically because it’s not about economics to them but politics. And so S&P will issue another warning after the deal calling for a solution, not a deal. More than ever, US sovereign will be on negative credit watch.

      JayDick in reply to Pasadena Phil. | July 18, 2011 at 4:33 pm

      We can’t really fix anything while Obama is in office. So, yes, it is about politics. But politics is the way we get out agenda implemented. We have to win politically first to win economically.

        We don’t have until the next election. In 2013, it’s the repo man who will be setting the terms. Our sovereign debt will have been downgraded while both parties blame the other (and because the “solution” was named after a Republican, guess whose narrative the biased media will go with?

        No, we gave the GOP another chance last November to deal with the problem right NOW. They caved during the lame duck session claiming that it the real battle would be over the debt ceiling and now they want to cave again.

        If they cave on this, they will lose big in 2012. Count on it. They certainly will have lost any chance of getting my vote.

          WarEagle82 in reply to Pasadena Phil. | July 18, 2011 at 8:24 pm

          I believe that GOP will be suffer a humiliating rejection in the 2012 elections if they defraud the American people yet again with another hoax on the American people.

          How quickly can Congressional approval hit negative numbers?

Subotai Bahadur | July 18, 2011 at 3:03 pm

First, there will be no real “victory” in this battle. The best we can hope for is to not destroy the country and Constitution by yielding to Obama and the bipartisan Political Class in the short term by yielding control over the non-existent budget and spending to a tyrannical Executive. Best case, some significant real immediate spending cuts NOW. Any spending cuts in the out years are as fictional as the patriotism of the Political Class. They will not happen. Any raise in the Debt Ceiling has to be short term, not lasting beyond November 2012, and preferably not lasting past July 2012.

Real victory is not possible; cut, cap, and balance, because the Institutional Republican leadership does not want to win and are looking for a way to surrender. Saturday the “Leadership” began pressuring Freshman Congressmen, telling them that the situation was so dire that it was necessary to yield to get a deal that would satisfy Obama. Even to the point of losing the next election.

They are talking about 2 symbolic votes, under special orders which requires a 2/3 majority [which we don’t have so it is a guaranteed loss] as being a sufficient victory. And the real fight will be in 2012 …. maybe. And we are supposed to believe them?

That is not a formula for victory.

It IS a formula for a third party. 1) They said they would fight and make cuts in the budget that the Democrats refused to do before the 2010 election. No cuts. But they said that they would really fight and cut and use the power of the House in the next budget, because it was in their hands. 2) Net on that “next budget”, claimed billions in cuts, that worked out to less than $50 million in cuts in reality …. in the out years after increasing spending for 5 years. 3) But they said that the real fight would be the Debt Ceiling, where they would stand fast because they hold the cards. Now they are calling for a total surrender.

Once is chance. Twice is coincidence. Three times is enemy action.

If they get nothing in reality, other than the pleasure of giving the Democrats the right to pin economic collapse on us instead of the Democrats; a whole lot of people are going to leave the Republican party. The only thing that might keep them in, would be if Sarah Palin decides to run as a Republican. If she runs third party, or declines to run at all; the Republican party will have exactly zero credibility left. Yeah, that means Obama wins. So does repeated Republican surrender, and/or the nomination of a candidate who will not fight.

If someone you really have no control of decides to commit suicide; you cannot stop them. If the Institutional Republican leadership is intent on committing suicide by yielding to the Democrats at every opportunity, it will make no difference whether Patriots stay in the party or leave. The Republicans are dead either way. And so perhaps is electoral politics for the forseeable future.

Subotai Bahadur

    Also, let’s keep in mind that the bill surrendering control of the debt ceiling to Obama will be named after a Republican Senator. If the plan is to pin the blame on Obama, let’s rename the McConnell Punt Bill to the Obama Punt Bill.

    The Stupid Party is just continues to plumb the depths of cluelessness.

      JayDick in reply to Pasadena Phil. | July 18, 2011 at 4:34 pm

      I don’t think it’s dumb to try to win the election in 2012. Only then can we get a reasonable economic policy enacted.

        See my comment above responding to the first time you posted that comment. Time has run out for these Assistant Democrats. It’s NEVER the right time to do the right thing with these spineless poindexters. Sh^t or get off of the pot already. They will lose next year and deserve it if they cave because of presidential election politics.

          JayDick in reply to Pasadena Phil. | July 19, 2011 at 7:03 am

          You don’t think they will lose if the debt limit is not raised? Failing to raise the debt limit will ensure Obama’s reelection. You need to watch what actually happens in politics. Republicans are good on policy, bad in politics.

Considering that a “shared sacrifice” requires spending cuts and new taxes on the “rich,” can it now be concluded that the “rich” get no benefit from government spending ?

“Considering that a true restructuring simply isn’t possible with Obama in the White House and Harry Reid in charge of the Senate,…”

Heck, a true restructuring would be darned difficult even with a 3/4 majority of Republicans in the House and Senate, and a fiscal Conservative in the White House. *Any* improvement in our headlong dash for the financial crash will be appreciated.

Will that be victory? Lots of good thoughtful responses here but I’ll keep it simple…..NO 🙁

aguyfromjersey | July 18, 2011 at 3:56 pm

Since the GOP punted on the continuing resolution, they are obligated to cover the amount allocated for this year. (So much for working in a bipartisan way and kicking the can down the road) They must fund the government, at those approved levels, till the end of the budget cycle (Oct 30 ?) Limit raising of the debt limit to what is needed, with a little room to spare.
After that, all bets are off. Cut It, Cap It. This fight should be ongoing, Where is the Budget for 2011 – 2012? How can they talk about cutting next year when we don’t know how much next year is? Paging Harry Reid!!
Off Topic State wide elections in New Jersey this year (Assembly and Senate, all seats are up for grabs). If I was in charge, I’ll wait is see what happens here in November before I’ll make a prediction on 2012

MaggotAtBroadAndWall | July 18, 2011 at 4:43 pm

I don’t think the Republicans can win.

If they negotiate a “big deal”, then Obama will get all the credit. If they go small ball, it will be viewed as a push with no winner and no loser. If some version of the McConnell plan gets implemented, then the Republicans will look like they punted. And since this third options is the worse option for the Republicans (in my view), then I’m reasonably confident the Republicans will cave and pursue this option.

I think they over-played their hand. They underestimated the degree to which Obama would demagogue them from the bully pulpit, and they definitely under-estimated how the media would push whatever narrative Obama created.

0bama will likely cave. 0bama caves on everything….
letting the country default screws him over hugely in the election. even more so… if he raises taxes and the unemployment accelerates.

let him veto… he’ll take the fall for it.

We’re going to have a hard time painting anything as a victory.

We have a lot of folks on our side who are ready to go off the cliff, flags flying – for them, anything short of capitulation by Obama won’t be good enough. Combine that with what we know the MSM will do – whatever happens, it’ll be a victory for Obama & defeat for us – and we’re going to be behind the 8-Ball.

Our side needs to realize a few things:

It’s not enough to convince “our side” of the rightness of our cause.

Complaining about somebody else’s “RINO” is a waste of time. “Everything would be fine if you people would get with the program” is not a workable plan. As aggravating as RINOs can be, they were elected by their constituents …. more likely than not, they’re “All the Republican We Can Hope For” from that constituency.

IMO, our best argument against Obama’s class envy rhetoric is “And then what?” As in “Even if we gave Obama all the tax increases he’s talked about, it won’t come close to closing the gap … He’ll need to raise taxes another $XXX billion to do that.”

A few of us discussed this issue. As a conservative, I don’t see how we can lose if we resist spending and raising taxes. If this action puts us in default, then what does that mean? It means that interest rates will return. With interest rates back, we have a place to put our money. Companies can get loans as people will be willing to part with their money for higher interest. The banks may be initially hurt, but they are dead anyway with the load of federal regulation. All this adds up to the fact that the Federal Reserve will be out of the economy without their permission. The market forces will take over. I attribute the Fed to a portion of the blame for our disaster and anemic recovery (actual depression). The rest of the problem with the recovery is due to Obama and his health plan and other regulation. But with a return of interest rates I feel that we may be looking at an improvement. This only occurs with default.

A display set up on the US Capitol plaza by the Democrat party and the Obama administration in hopes of getting cargo from the GOP…

zillions of cargo

My view, is that the battle is being fought on two fronts:

-practical

-philosophical

Unfortunately, they are at odds…at this time.

It always comes down to “Are we Greece?” and “What’s wrong with being Greece?”

I don’t understand why conservatives do not spend millons shouting from the rooftops “Obama increased the debt by three point four trillion dollars and he says he is serious about cutting the debt.

DINORightMarie | July 18, 2011 at 9:32 pm

Victory would be for Republicans to hold the line. No caving.

To pass Cut & Cap Bill, which would build in a $2.5T ceiling increase, 1 time only, with matching cuts. And to send a BBA to the states for ratification.

Also, in addition, vote on a bill/resolution to outline priorities for payments, so the terrorist-in-chief can stop holding the elderly, veterans, etc. hostage and demagogue using them. A despicable act for any one; beneath a President of the United States. Horrible.

If Obama gets anything close to his way, a tax increase or “revenue increase” as he is wont to say, or if the outlined cuts don’t match the ceiling increase, then it’s over for them. Incumbents will be primaried, then voted out. They will have failed. McConnell will be first on that list. Boehner will be next.

Just call the man’s bluff!! If he gets his $2.5T ceiling increase and vetoes it, then it is ALL in his lap. Also…..

I would LOVE to see his boxers twisting in the wind when his silver haired supporters start publicly decrying, “Obama won’t pay my Social Security?! IT’S IN A TRUST FUND!!! He can’t do that – IT’S MY MONEY!!!” …which will beg the question (especially during townhalls and the election): “How come Social Security is not in a trust fund, with the funds waiting to be paid out, as was promised?!” He opened Pandora’s box on that one…..that will hopefully come back to bite him. I can only hope.

Key to passing the Cut, Cap, and Balance Act (where the BBA is voted separately to send to the states) is getting enough RINOs and Dems to see that if they don’t do this, THEY WILL BE VOTED OUT, and they will take the hit when the fit hits the shan. Obama, Reid, they will own it, if the Republicans hold the freakin’ line.

“Never give in. NEVER give in! NEVER GIVE IN!!” –W. Churchill

One of my favorite quotes. Up there with Dame Maggie Thatcher’s quote about socialism running out of other people’s money.

Now, there are two examples to follow. Reaganesque.

Perhaps the better analogy is whether to play checkers or chess with Obama and the Democrats. I think Obama is giving tremendous cover to the do-nothing Senate Democrats. The Senate Democrats have not proffered a spending bill in over 2 years. They are in violation of the law.
There is nothing the House would propose which would make us Conservatives happy that will pass the Senate. The House is playing a losing battle. They are damned if they do and damned if they don’t. Obama and the Senate Democrats know this and are digging in their heels. They have proposed very few cuts. According to McConnell via the WSJ, Jacob Lew has admitted the “Grand Bargain” has only $2Billion in cuts. That’s right …. $2BILLION!

The McConnell Plan is pretty interesting. It forces Obama and the Dems to own the debt problem issue. Sure, there are inherent problems in doing so but I would rather force the Democrats to face political reality (as well as a political reckoning) instead of forcing our side to go over a cliff.
How quickly we forget the disastrous deal Boehner and the rest of the GOP House Leadership made during the 2011 Budget negotiations. The savings they claimed turned out to be quite miniscule. I think it is time to give in just a little bit to win big down the road. It is akin to sacrificing a pawn to capture the Queen.

If not, who/what will rescue the House GOP from their Dunkirk? Cut, Cap, and Balance? Not bloody likely.

FreedomWorks, RedSate, American Majority Action, Let Freedom Ring, and the Club For Growth in draft a letter to Republicans in Congress opposing the McConnell Plan. Of particular note, considering who all is on board this letter, is this paragraph:

“We will refrain from backing any Member of Congress or candidate for federal office, or a leadership position in a Republican Caucus, who supports the McConnell—Reid—Pelosi “Cut, Run, and Hide” plan, to the extent that our various legal structures and rules allow.”

Defeat McConnell Coalition

With the strength of the Repubs in the senate the only victory that I can see is a short term solution. The Senate has not passed a budget! The President has not received a budget. To negotiate at this point is a pointless excercise. Pass a budget and then you may or mayn’t need a compromise. Right now the Repubs are just playing Charlie Brown football. Stop any and all negotiations over debt ceiling until you have a basis from which to compromise.
And yes, this is a wonderful excercise in demonstrating a time for a new party.

Are the Dems going to go for broke (no pun intended)?

Bill Clinton Would Declare The Debt Limit Illegal

National Memo

A Democrat putsch in the wind?

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