The *Budget Fight* Thread (Jan-Feb-March 2013 Edition)

[Elessar78]

Not raising the debt ceiling is just stupid. It is the only action that could force us into default on our debt. It would force us to balance the budget immediately which sounds great but it would cause massive, indiscriminate cuts across the board. Thousands of federal workers would lose their jobs, industries dependent on federal contracts would suffer, benefits to social security and medicare would be cut, as well as defense spending. Not exactly the things you want when a) you're trying to stoke this recovery and trying to raise revenue by growing the economy.

[Fergasun]

For those interested, we aren't likely to hear much news the next couple of weeks because Congress is out of session. The House resumes on January 14th, and the Senate will resume on January 21st. It looks like the date that Treasury has to meet is February 15th... although official we've hit the debt ceiling. You would think if the GOP was really serious about stopping a debt ceiling raise they would move to block the Treasury Secretary from playing games to extend the debt limit out. Even it it's just symbolic since it wouldn't pass the Senate, they have taken so many symbolic votes over the past 2 years that why would this be any different?

Actions speak louder than words my GOP friends...

[Fergasun]

Politico: (Debt Debate) No Easy Path to Avoid Chaos

So it’s not surprising that Boehner’s chief of staff told a gathering last week at the Republican National Committee headquarters that Congress may end up raising the debt ceiling every month or every three months. The idea is gaining ground among Republicans as a tactic to wear down Obama and force him to cut spending, repeatedly and deeply.

...

Even if Republicans cave on the debt ceiling and raise it for an extended period, they could force short-term patches for the sequester and a bill to fund government agencies as a way to extract deep spending cuts. Steven Bell, a longtime budget aide to former Sen. Pete Domenici (R-N.M.), said he views this as the most likely scenario: extend the country’s borrowing authority for three months and allow the sequester to kick in. “Do not underestimate the number of people who are really frustrated, really unhappy, who are saying I’m not going to do this anymore,” said Bell, senior director of economic policy at the Bipartisan Policy Center. In their view, the sequester “is the only way to get real cuts.”

Oh joy! Cannot wait!

More:

FederalTimes.Com: Republicans urge entitlement cuts to void Defense sequester

New GOP Sen. Deb Fischer of Nebraska signaled congressional Republicans will seek to void all pending cuts to planned Pentagon spending. In Republicans’ weekly address on Saturday, Fischer called for permanently turning off $500 billion in across-the-board Pentagon cuts set to be triggered March 1. A deficit-reduction package of $1.2 trillion passed by both chambers and signed by President Obama would void those defense cuts and an equal amount of domestic cuts. During her year-and-a-half campaign, Fischer said Americans she encountered shared one view: “Washington must cut out-of-control spending."

...

Last week, White House Press Secretary Jay Carney said Obama wants to eliminate all the pending sequestration cuts. But Carney reiterated the president’s demand that a package to void them must include other federal cuts and new revenues. The latter has been called “a non-starter” by even some moderate GOP senators.

Interesting tone she set there.

Also, no one is talking about it, but I imagine some tax returns might get delayed because of the debt-ceiling/budget fight. Think about how much fun that everyone in this continuing economic environment.

[Larry]

Has the GOP Congress considered, oh, I don't know, passing a budget that contains the cuts they (loudly and repeatedly claim they) want?

I know. Silly question.

The GOP doesn't want the GOP to cut spending. They want to take hostages, and demand that somebody else cut spending. (So that they can then run to the voters, and tell the voters to vote GOP, because somebody else cut spending.)

[Fergasun]

Has the GOP Congress considered, oh, I don't know, passing a budget that contains the cuts they (loudly and repeatedly claim they) want?

I know. Silly question.

The GOP doesn't want the GOP to cut spending. They want to take hostages, and demand that somebody else cut spending. (So that they can then run to the voters, and tell the voters to vote GOP, because somebody else cut spending.)

Larry,

That's not true. I don't know when Paul Ryan unveiled the "Path to Prosperity" (2010?), but that essentially is the framework for their FY2011, FY2012, and FY2013 budgets. If you Google it you can find the latest (FY2013) plan. Basically cut taxes and cut government programs that benefit the middle class under the guise of "saving them for the future". If you look closely he's only claiming $4.4T in deficit reduction over 10 years.... which means $440/year which would mean we run deficits of $600B.

There's also the Republican Study Committee budget, which is more aggressive at cutting the government than Paul Ryan's plan. Last year the RSC plan did not pass the House.

3, 2, 1 before someone comes in here talking about how Democrats didn't pass a budget. Their budget is to maintain levels of spending, and not make any cuts, nor any increases to spending. Discretionary spending caps were put in place last year.... so I think this year or next there may be mandatory spending (social security, medicare) cuts. There was also a budget proposal by progress (far-left) groups which increased spending (kind've the Democratic version of the RSC).

Neither side will get what they want, they have to figure out how to give up just enough, and get just enough to be happy and kick the can down the road again. It would be nice if they rolled FY14 into whatever deal they make (we didn't have much drama over the FY12 budget)... but I think the GOP strategy might be to continue funding the government at smaller increments. They need to start working on that huge tax reform and social program reform stuff if they are really going to put that into FY14.

[Thiebear]

So we want the House to pass a budget,

The Senate to update it and have it go to committee

and then the President to sign it?

or a variation of that each year? that keeps us from going 20trillion plus while the growth stays below 3%

[Gallen5862]

http://www.washingtonpost.com/politi...712_story.html

House set to vote on Hurricane Sandy relief package

The House is set to vote Tuesday on $50 billion dollars in relief for victims of Hurricane Sandy, a package designed to speed aid to devastated communities in New York and New Jersey, and a vote that could provide an early test of the resolve of Republican deficit hawks.

The package is likely to be approved on the strength of votes from Democrats and Republicans who hail from communities hit hard by the Oct. 29, 2012 storm, as well as others who come from communities that have faced recent natural disasters.

The House will vote on an underlying bill that includes $17 billion intended to cover immediate relief needs, including $5.4 billion for the FEMA fund that funnels aid directly to individuals and local communities to rebuild.

Later, the House will take action on an amendment that would provide $33.6 billion in additional money to cover a longer-term effort to rebuild.

Splitting the bill into two pieces allows those Republicans who want to vote to provide immediate help to withhold their votes from the longterm effort.

[Thiebear]

Once the republicans caved and gave up the AMT tax, some taxes on the 250k and the wanted tax increases on the 400k.

Aren't we supposed to follow that up with Spending constraints..

Lets say 2 concessions:

Put that PAYGO back on the mandatory list again....

Recommend and Pass a Budget each year when due by law...

Offer that and then ask the Republicans to accept 2 concessions.

Do that for a couple months and we might just be back to the Pres/Congress we had in the 90's.

[Gallen5862]

http://www.washingtonpost.com/blogs/...endment-fails/

House passes $17 billion in Sandy aid, conservative amendment fails

The House has agreed to a bill that includes $17 billion intended to cover immediate relief needs for victims of Hurricane Sandy, including $5.4 billion for the FEMA fund that funnels aid directly to individuals and local communities to rebuild. The measure passed on a 327 to 91 vote. Later, the House will take action on an amendment that would provide $33.6 billion in additional money to cover a longer-term effort to rebuild devastated communities in New York and New Jersey.

http://www.washingtonpost.com/politics/house-set-to-vote-on-hurricane-sandy-relief-package/2013/01/15/984d5dec-5f32-11e2-b05a-605528f6b712_story.html

House approves Hurricane Sandy relief package

The House on Tuesday approved $50 billion in relief for victims of Hurricane Sandy, a package designed to speed aid to devastated communities in New York and New Jersey, and a vote that provided an early test of the resolve of Republican deficit hawks.

The package was adopted on a 241 to 80 vote, on the strength of support from Democrats, as well as 49 Republicans, who mostly hail from communities hit hard by the Oct. 29, 2012, storm.

[Stadium-Armory]

Not raising the debt ceiling is just stupid. It is the only action that could force us into default on our debt. It would force us to balance the budget immediately which sounds great but it would cause massive, indiscriminate cuts across the board. Thousands of federal workers would lose their jobs, industries dependent on federal contracts would suffer, benefits to social security and medicare would be cut, as well as defense spending. Not exactly the things you want when a) you're trying to stoke this recovery and trying to raise revenue by growing the economy.

Yup.

http://www.politicususa.com/fitch-ratings-warns-debt-ceiling-ineffective-controlling-debt.html

Fitch points out that the Republican strategy of using the debt ceiling as a mechanism for lowering debt is an ineffective and potentially dangerous plan, “In Fitch’s opinion, the debt ceiling is an ineffective and potentially dangerous mechanism for enforcing fiscal discipline. It does not prevent tax and spending decisions that will incur debt issuance in excess of the ceiling while the sanction of not raising the ceiling risks a sovereign default and renders such a threat incredible.”

In other words, Republican talking points on the debt ceiling are absurd. This is not the way to go about tightening your belt because it does nothing but lower your credit rating. This should be obvious, since the debt ceiling represents money Congress already spent, but apparently things need to be spelled out slowly for modern day Republicans. If you don’t pay off your credit card, they jack up the rate and you fall deeper into the hole. That’s the same idea as not raising the debt ceiling.

Refusing to raise the debt ceiling is only going to make things worse, and add more debt, so this Republican threat is obviously not coming from real concern over actual debt.

Republicans keep saying that spending is the problem and so they must get cuts or else. If that is their position, they need to take it up with themselves. Why haven’t they made defense cuts if they’re so worried about spending?

[Hersh]

For those interested, we aren't likely to hear much news the next couple of weeks because Congress is out of session. The House resumes on January 14th, and the Senate will resume on January 21st. It looks like the date that Treasury has to meet is February 15th... although official we've hit the debt ceiling. You would think if the GOP was really serious about stopping a debt ceiling raise they would move to block the Treasury Secretary from playing games to extend the debt limit out. Even it it's just symbolic since it wouldn't pass the Senate, they have taken so many symbolic votes over the past 2 years that why would this be any different?

Actions speak louder than words my GOP friends...

Do you think many of the Republicans pushing for default actually understand what would happen to the economy? I'm positive that at least half of those that vote for the republican party don't have a clue as to what would happen.

[chipwhich]

Do you think many of the Republicans pushing for default actually understand what would happen to the economy? I'm positive that at least half of those that vote for the republican party don't have a clue as to what would happen.

And I'm positive nobody will let that happen. Do you really think everyone doesn't know this?

[Elessar78]

Do you think many of the Republicans pushing for default actually understand what would happen to the economy? I'm positive that at least half of those that vote for the republican party don't have a clue as to what would happen.

In all fairness, half of Progressives (me being one of them don't understand it either).

I don't even stand a chance explaining this over the dinner table to my conservative in laws because it requires more than a sound bite explanation. They're not stupid people but just unwilling to listen.

[Hersh]

And I'm positive nobody will let that happen. Do you really think everyone doesn't know this?

I think there are a lot of people on the right that would willfully let it happen because they believe the end justify the means. They don't have a clear understanding on the crippling effect it would have on a lot of industries they support.

[chipwhich]

I think there are a lot of people on the right that would willfully let it happen because they believe the end justify the means. They don't have a clear understanding on the crippling effect it would have on a lot of industries they support.

No, they wont. They want their jobs.

[Thiebear]

So lets see how we are doing: http://www.nytimes.com/interactive/2010/11/13/weekinreview/deficits-graphic.html

Allow expiration for income above $250,000 a year - 30 billion (modified to slightly less due to the changes).

Millionaire's tax on income above $1 million - 50 billion

As was said about the widgets for California when when we were going through that NYtimes article: It should be mandatory Congress do a preliminary vote with the ones that pass going to committee for review and real vote.

[Fergasun]

So lets see how we are doing: http://www.nytimes.com/interactive/2010/11/13/weekinreview/deficits-graphic.html

Allow expiration for income above $250,000 a year - 30 billion (modified to slightly less due to the changes).

Millionaire's tax on income above $1 million - 50 billion

As was said about the widgets for California when when we were going through that NYtimes article: It should be mandatory Congress do a preliminary vote with the ones that pass going to committee for review and real vote.

I don't think people get why Congress does what it does. People on the right think, "we can just pass a budget in regular order and then blame the Democratic Senate." Yes, but as soon as you do that the Democrats are going to take to the airwaves and talk in detail about the GOP's cuts and how damaging they will be to the middle class. Also, I will throw this out, what incentive does the Senate have to pass a budget? It's not like the House where the GOP has the "luxury" have a majority and doesn't have to compromise to pick up votes on the budget. The Senate has to craft a budget that will get 5 GOP votes in the Senate to pass, and the only way they do that is by making some cuts. Why would they do such a thing? All of those previous committees failed.

Conference committee is an interesting thought, but it has the same pitfalls as all the other debt-reduction committees that have been proposed (the "super committee", and I thought there was another committee before that). What is the benefit of having something like 8 poliicians on each side arguing over the Federal budget, and then in the end they won't agree on anything.

Hence, we end up with these one-on-one negotiations. If the rank-and-file want to go through reglular order, they need to understand that it requires 228 willing to compromise in the House and 60 willing to compromise in the Senate. I doubt very much that the House will present a "softened" Federal budget as a compromise. Why negotiate against yourselves? If they were really clever they would start out with the Ryan budget and then start paring out some of their cuts. For each cut they have 2 or 3 alternatives which are "softened"... and include an option with no cuts. That would be a nice little war.... and the GOP could do it, but I think it would take time.

Besides, pretty much now everyone has realized that its medical costs that are driving Federal spending and the deficit.... whether or not our government will break the medical industry is another question. They didn't break the banks in 2008, so why would anyone expect them to break the medical industry?

[Gallen5862]

http://www.washingtonpost.com/business/economy/house-republicans-plant-to-keep-debt-limit-but-suspend-it-until-may/2013/01/22/14bc4f3e-64ae-11e2-85f5-a8a9228e55e7_story.html

Obama ‘will not oppose’ House GOP plan to suspend debt limit until May

Forget about raising the federal debt limit. House Republicans are proposing to ignore it altogether — at least until May 18.

The House plans to vote Wednesday on a measure that would leave the $16.4 trillion borrowing limit intact but suspend it from the time the bill passes until mid-May. The declaration that the debt ceiling “shall not apply” means that the government could continue borrowing to cover its obligations to creditors until May 18.

This approach — novel in modern times — would let Republicans avoid a potentially disastrous fight over the debt limit without actually voting to let the Treasury borrow more money.

[Gallen5862]

http://www.washingtonpost.com/politics/hold-house-votes-to-suspend-debt-limit/2013/01/23/58f2013c-6574-11e2-85f5-a8a9228e55e7_story.html?wpisrc=al_comboPNE_p

House votes to suspend debt limit

A measure to suspend the nation’s legal limit on borrowing for nearly four months cleared a key vote in the House Wednesday, as Republicans broadly endorsed a new tactic that would temporarily remove the threat of a potentially calamitous government default from their ongoing fight with Democrats over government spending.

The measure, which would set aside the legal debt ceiling and allow the government to borrow as needed to meet spending obligations through May 18, was adopted on a 285 to 144 vote.

Just before the vote, Democratic leaders in the Senate said they would accept the House measure without changes and a Senate vote is expected as soon as next week. And the White House, too, has said President Obama will not stand in the way of the bill.

[Larry]

Do you think many of the Republicans pushing for default actually understand what would happen to the economy? I'm positive that at least half of those that vote for the republican party don't have a clue as to what would happen.

The voters? And the Republican cheering section in here?

Just a personal opinion, but yeah, the impression I get is that yeah, about half of them have no clue whatsoever.

The people in Washington?

I hope not. I really hope that it's just rhetoric, for one reason or another.

(I profoundly wish I could be sure.)

[The Evil Genius]

[Gallen5862]

http://www.washingtonpost.com/politics/senate-leaders-reach-deal-modifying-filibuster-procedures/2013/01/24/48a8ca16-6648-11e2-85f5-a8a9228e55e7_story.html

Senate leaders reach deal modifying filibuster rules, keep 60-vote hurdle

Senate leaders reached a deal Thursday that keeps the chamber’s long-standing, 60-vote threshold for halting a filibuster but streamlines some of the chamber’s more cumbersome procedures.

The key new proposal allows the elimination of one filibuster vote during the “motion to proceed” to a bill, when the chamber begins considering legislation. Republicans have increasingly filibustered the motion to begin debating legislation to either slow passage of or block bills altogether.

GOP senators say they use the move because Reid has been increasingly using an even more arcane maneuver that prevents them from offering amendments to legislation. So the proposal, crafted by Sens. Carl Levin (D-Mich.) and John McCain (R-Ariz.), would guarantee that the opposing side would get to offer at least two amendments if Reid tried to shut off a wide-open chance to offer amendments.

[Larry]

Really not a fan of either side deciding to change the rules. My personal opinion is that if the rules have worked this long, then the problem isn't the rules.

At least it looks like a bipartisan proposal, though.

[Tulane Skins Fan]

Really not a fan of either side deciding to change the rules. My personal opinion is that if the rules have worked this long, then the problem isn't the rules.

At least it looks like a bipartisan proposal, though.

Nothing personal, but kinda goes against the concept of the attempt to create a more perfect union. We can always improve.

[Jumbo]

Whatever else one my find this to be (simplistic, partisan, erroneous, whatever) i thought it was worth posting and will take any heat for that choice. <insert missing and mourned grin smiley>