Republicans announce their concession in debt fight.

[SirNitram]

Link

Republican leaders won't accept tax increases in exchange for deep entitlement cuts, and say they'll only raise the national debt limit in exchange for a spending cut package that's revenue neutral.

That leaves them vulnerable to the charge that they're not negotiating in good faith -- that they're refusing to budge on anything of ideological importance to them under the threat of a catastrophic debt default. So they need an answer when pressed: If President Obama has agreed in principle to cut entitlements, over howls of protests from members of his party, what are Republicans prepared to offer that amounts to similar political risk in their own party.

Here's what they've settled on: We'll agree to raise the debt limit!

At his weekly press availability House Majority Leader Eric Cantor (R-VA) said the key Republican concession is "the fact that we are voting -- the fact that we are even discussing voting for a debt ceiling increase." He claimed this was a significant move. "What I don't think the White House understands is how difficult it is for fiscal conservatives to say they're going to vote to pay for a debt ceiling increase."

Just before leaving for the White House, Speaker John Boehner (R-OH) also told reporters that a "balanced" approach is one where Obama agrees to the GOP's fiscal framework and Republicans agree to prevent a default.

"Most Americans would say that a balanced approach is a simple one: the administration gets its debt limit increase, and the American people get their spending cuts," Boehner said. The glaring problem with this interpretation is that Republican leaders have admitted that raising the debt ceiling is imperative -- not an arbitrary policy preference of the President's.

"I agree with the President we can not allow our nation to default on our debt," Boehner said at the same press conference.

A week ago, Politico reporter David Rogers questioned Cantor's assertion that Republicans are only talking about raising the debt limit because Obama asked them to.

"Even if he never asked you to raise the debt limit, you recognize as a responsible House leader you would have to raise the debt ceiling?" Rogers pressed.

"There is no question that the amount of increase in the debt limit is in direct correspondence to fiscal mismanagement in the past," Cantor said in response. "These are bills that have been run up. That has to be done, yes. I have always said so."

In the end this isn't a question of whether Republicans will find an acceptable price for raising the debt limit. It's about whether Republicans will budge at all on the issue of revenue neutrality, and whether they'll agree to raise the debt limit until after the 2012 elections, even if the final debt limit bill doesn't cut deficits by $2 trillion or more.

In short, they have conceded they will not be ridiculously reckless, and won't do any more. Given that all markets respond on rumours, fears, hopes, and lies, I think not passing this will scare enough people to do serious economic harm. With the U6 Unemployment measurement at 16%, this is deranged.

[Alyeska]

The GOP has been playing a game of chicken on this particular issue in congress right now. They keep moving the goal posts every time someone say "fine, lets deal". I wonder if its going to come back to bite them in the ass. I wonder if the Democratic leadership will grow a F*cking spine and hammer the GOP in another area as retaliation and remind them that playing chicken with the country is not acceptable.

These fuckers are willing to let the country burn purely to spite the Democrats. Gah, it infuriates. All because of the "Tea Party revolution". Apparently some elements of the GOP are starting to realize the monster they've gotten in bed with. Some within the GOP were actually in the process of making a deal with Obama when the Tea Party element derailed the entire agreement forcing No Compromise.

http://www.politico.com/news/stories/0711/58662.html

[JME2]

I wonder if the Democratic leadership will grow a F*cking spine and hammer the GOP in another area as retaliation and remind them that playing chicken with the country is not acceptable.

The time to grow a spine was 2009-2010, before the political damage caused by the midterm election.

Still, they need to do something. I believe without any doubt, as you pointed out, that the GOP will burn us all to spite the Dems. This has to stop.

[Thanas]

So Obama sacrifices social security for what he would have gotten anyway?

[Questor]

So Obama sacrifices social security for what he would have gotten anyway?

I actually don't read this the same way, I read it as the Republicans saying that that their part of the "compromise" is agreeing to the debt ceiling hike at all. Here is the Yahoo News article on the same subject.

GOP leaders say they’ve sacrificed enough already on debt negotiations

Amid ongoing negotiations with President Obama over raising the debt ceiling, House Republican leaders responded to Obama's call Monday for compromise by saying that their openness to raising the debt ceiling at all is sacrifice enough.
"A vote to increase the debt limit in this country is an existential question for a fiscal conservative," House Majority Leader Eric Cantor said Monday. "These votes aren't easy. ...What I don't think that the White House understands is how difficult it is for fiscal conservatives to say they're going to vote for a debt ceiling increase."
Congressional leaders are heading into a second straight day of negotiations with the president today over raising the nation's $14.3 trillion debt ceiling, which Republicans have refused to support without "major" cuts to federal spending. The White House has suggested a compromise that includes restructuring the nation's entitlement programs--currently the main drivers of debt--in exchange for tax increases, but Republicans continue to refuse any deal that raises rates.
"Adding tax increases to the equation doesn't balance anything," House Speaker John Boehner said before today's meeting with Obama, arguing that as a lead Republican negotiator on the issue, he's already "going to take my fair share" of hurt by merely talking to the president about raising the debt limit.
Cantor went so far as to say that the issue of taxes was an "irreconcilable difference" between his caucus and the White House, and also rejected Obama's offer to hold off on raising taxes for two years.
"We're not going to burden small business people or those looking to invest, saying 'hey, not this year, but maybe next year your tax rates are going to go up,' " Cantor said. "That doesn't make sense."
Boehner announced Saturday that he would reject a wide-ranging deal offered by the White House, settling instead for a smaller settlement to get Congress to increase the debt ceiling, which the Treasury Department says must be done by August 2 or the federal government could risk default.
The president says he hopes to have a deal completed by July 22.

[Simon_Jester]

This is a fairly standard negotiation tactic- have someone in your organization who's got a reputation for being more radical than you stand there and growl at you for daring to concede something which should so obviously be conceded that any sane person wouldn't even consider was on the table.

It makes you look magnanimous, if you bring it off correctly.

[Edi]

So Obama sacrifices social security for what he would have gotten anyway?

He offered to sacrifice it, knowing the Republicans would not accept due to ideology, but it was still a stupid move, because now that he has brought it to the table for absolutely no gain to anyone but the "Fuck'em and die in the gutter" wing of Republicans, he has yet again conceded to frame the discussion on Republican terms. It will come back to bite him in the ass later, even if he may extract some political benefit from this now. Assuming he doesn't bungle that up too.

[JME2]

GOP leaders say they’ve sacrificed enough already on debt negotiation

Oh fuck you, you little ass-wipes.

God, I'd love to see these fuckers lose the House next Fall.

[Stravo]

Again, I don't see Democrats drumming home the point in these negotiations that the Republicans are standing firm on not raising taxes on the very rich (not the Democrat Rich who make over 100k) and oil companies. They are allowing the Republicans to frame it as "We're against raising taxes" Why the FUCK do they do this every time, Every fucking time, Democrats allow the Republicans to control the rhetoric and frame the arguments. Are they really and truly that bad? Don't the Dems see every time how when they are on the right side of an issue how they can hammer the other side - "You don't want us raising taxes on the people who have not been hurt by this economy to save those that have." or even frame it as well in a "kitchen table" type language - "sometimes you can only cut costs so far in a household budget before you have to consider making more money or finding more income. For a government, more income means higher taxes. If you don't want to raise taxes, on oil companies and the rich, then it means you no longer will get xy and z benefits. It's really that simple"

Sometimes I honestly wonder whether these two parties are in bed with each other, the Democrats act intentionally stupid so that in the end some half assed "compromise" is made that accomplishes nothing but keeps their corporate daddies happy.

[Eleas]

Don't the Dems see every time how when they are on the right side of an issue how they can hammer the other side - "You don't want us raising taxes on the people who have not been hurt by this economy to save those that have." or even frame it as well in a "kitchen table" type language - "sometimes you can only cut costs so far in a household budget before you have to consider making more money or finding more income. For a government, more income means higher taxes. If you don't want to raise taxes, on oil companies and the rich, then it means you no longer will get xy and z benefits. It's really that simple"

Wouldn't that kinda risk destroying any hope of support from industry and the rich?

[erik_t]

And the GOP brings in the long-snapper to punt.

link
The Big Blink? McConnell Proposes Giving Obama Authority To Raise Debt Limit Alone

Senate Minority Leader Mitch McConnell (R-KY) has proposed a sort of escape hatch for Congressional Republicans, who have threatened not to raise the national debt limit -- and trigger a default -- if Democrats don't agree to trillions of dollars in cuts to popular social programs.

The plan is designed to give President Obama the power to raise the debt limit through the end of his first term on his own, but to force Democrats to take a series of votes on the debt limit vote in the months leading up to the election.

The development confirms suspicions that the GOP was unwilling to truly use the looming debt ceiling as leverage to force conservative-friendly changes to popular entitlement programs, but suggests strongly that Republicans plan to continue politicking on the issue of debt and deficits through the 2012 elections.

In what McConnell described as a "last-choice option," McConnell proposed a method by which the country could avoid default if debt negotiations led by President Obama fail to produce a grand bargain on debt reduction.

"If we're unable to come together, we think it's extremely important that the country reassure the markets that default is not an option, and reassure Social Security recipients and families of military veterans that default is not an option," McConnell said.

The plan would require Congress to pass a bill allowing Obama to raise the debt limit on his own contingent on him taking a series of steps: Obama would have to notify Congress of his intent tor raise the debt limit -- a high-sign to Congress that would be subject to an official censure known as a "resolution of disapproval," and which Obama could veto. If he vetoed the resolution, and if Congress sustained the veto, then Obama would also have to outline a series of hypothetical spending cuts he'd make, equal to the amount of new debt authority he gives himself.

(article continues)

The right-wing interwebs are aflame at the idea, but this looks like it might be the beginning of the end. Of course Mitch has to drag his furious congressional compatriots along for the ride.

[Anguirus]

At his weekly press availability House Majority Leader Eric Cantor (R-VA) said the key Republican concession is "the fact that we are voting -- the fact that we are even discussing voting for a debt ceiling increase." He claimed this was a significant move. "What I don't think the White House understands is how difficult it is for fiscal conservatives to say they're going to vote to pay for a debt ceiling increase."

Would be nice of the reporter to mention how eagerly they did so for the Bush White House.

[SirNitram]

Mitch's proposal is a bad idea by all possible measures, especially for Democratic politics. But it's showing how desperate the GOP is getting to try and get themselves out of the fact that Obama's refusal to accede to the GOP deals, and the other option is default. The cracks are forming.

[Crossroads Inc.]

In a way this gives me "SOME" hopes, it shows those at the top of the GOP right now actually DO realize that if we default America is FCKED. That said it shows to just what lengths they will go to to try and purposly screw over Obama at this point.
The very idea of basically saying "We won't pass it, let the President pass it by himself" of course he adds that it does have to be voted on, surprise surprise, only by democrats.

Dear god, we have really reached new levels of mindless assholeishness in America. I know there has been dirty politics in the past but I don't know if it has ever been so "organized" untill the last 10 years or so.

[CJvR]

I have never questioned the sanity of US politics more than now. Quite frankly it seems as if a large part of the elected lunatics WANT a default and are cheerfully dancing over to the edge of the cliff. Just... wow!

[Sriad]

default

Although failing to raise the debt ceiling would be a total disaster it wouldn't be QUITE that bad... we'd "only" shut down 100% of discretionary spending like federal law enforcement and prisons, paying active soldier's salaries, national parks, and so on... Day-by-day income would be enough to pay interest on the most important parts of the national debt, cover medicare, and get out social security checks so we don't have little old ladies starving in their homes.

...Basically like being hit with an 9.0 earthquake instead of a 10.0.

[Ariphaos]

default

Although failing to raise the debt ceiling would be a total disaster it wouldn't be QUITE that bad... we'd "only" shut down 100% of discretionary spending like federal law enforcement and prisons, paying active soldier's salaries, national parks, and so on... Day-by-day income would be enough to pay interest on the most important parts of the national debt, cover medicare, and get out social security checks so we don't have little old ladies starving in their homes.

...Basically like being hit with an 9.0 earthquake instead of a 10.0.

Revenue does not actually fully cover nondiscretionary spending. Something would have to be cut.

[SpaceMarine93]

Its obvious - they are either deliberately delaying solving of the the debt issue in Congress until the last possible moment and then blame every problem that arose in between to President Obama in an attempt to further discredit him, or they are just a bunch of inflexible, idealistic morons who would rather allow another catastrophic economic collapse than doing what is necessary to save the American economy that is at odds with their ideals.

For goodness sake, if we don't raise the debt limit right now, America would never recover! And yet these fools just keep trying to stop people from doing the right thing again and again. I just want to know, why?

[Flagg]

Its obvious - they are either deliberately delaying solving of the the debt issue in Congress until the last possible moment and then blame every problem that arose in between to President Obama in an attempt to further discredit him, or they are just a bunch of inflexible, idealistic morons who would rather allow another catastrophic economic collapse than doing what is necessary to save the American economy that is at odds with their ideals.

For goodness sake, if we don't raise the debt limit right now, America would never recover! And yet these fools just keep trying to stop people from doing the right thing again and again. I just want to know, why?

Political gain. If the economy does significantly better Obamas reelection is a lock, and as Mitch McConnel the minority leader in the Senate has said numerous times, his top priority is seeing that Obama is a 1 term president.

[Coalition]

Eric Cantor might be hoping for a default, with his conflict of interest:
http://www.salon.com/news/politics/war_ ... f_interest

In short, he has a few thousand in a fund that 'shorts' US Treasury bonds. If the bonds lose value, the fund gains money. So if he wants to make money, he needs to find a way to make the treasury bonds lose money.

[CJvR]

For goodness sake, if we don't raise the debt limit right now, America would never recover! And yet these fools just keep trying to stop people from doing the right thing again and again. I just want to know, why?

One impression I have gotten from this insanity is that some seems to see this as an oppertunity to force the state to cut things they dont approve off. Perhaps Obama should put some different items on the chopping block first, stuff the opposition actually favors.

[erik_t]

Eric Cantor might be hoping for a default, with his conflict of interest:
http://www.salon.com/news/politics/war_ ... f_interest

In short, he has a few thousand in a fund that 'shorts' US Treasury bonds. If the bonds lose value, the fund gains money. So if he wants to make money, he needs to find a way to make the treasury bonds lose money.

Cantor is wealthy enough that I'm sure he has far, far more money in stocks that would lose a shit-ton of money in the default doomsday scenario. Take off your tinfoil hat.

[aerius]

Pretty much. If you short something to zero you clear a 100% profit, the Proshares Ultras are 2X leveraged funds so if US Treasuries go to zero you clear a 200% profit before fees & slippage. At best he'll clear a $30k profit off his holdings, but he wouldn't be able to collect since if US Treasuries go to zero we're probably looking at Mad Max.

[Crossroads Inc.]

Well the shoe is on the other foot now...
After it seemed like the GOP had come to thier senses Obama Storms Out of the talks now.
No idea what got to him other then this:

WASHINGTON (AP) — President Barack Obama has ended a nearly two hour debt-limit negotiation brusquely, declaring: "Enough is enough" as he rejected Republican demands that he accept a short-term extension of the government's borrowing authority.
Democratic officials and Republican aides familiar with the negotiations say the meeting ended after White House officials had identified more than $1.5 trillion in spending cuts over 10 years to reduce the deficit. Pressed by House Republican leader Eric Cantor to accept only months-long debt ceiling increase, Democratic officials say Obama announced: "Enough is enough. We have to be willing to compromise. It shouldn't be about positioning, and politics and I'll see you all tomorrow."
The officials spoke on condition of anonymity to describe the closed-door meeting.

[JME2]

Hmm.

I wonder what set him off, too.