Below is an outline of the GOP’s debt-ceiling bill obtained by National Review Online. The document originated from staff to a senior member of the House Appropriations Committee and is dated yesterday.Now, before I comment, let me lay out two other facts.
One Year Debt Limit Increase
Not a dollar amount increase, but suspending the debt limit until the end of December 2014.
Similar to what we did earlier this year.
Want the year long to align with the year delay of Obamacare.
One Year Obamacare delay
Tax Reform Instructions
Similar to a bill we passed last fall, laying out broad from Ryan Budget principles for what tax reform should look like.
Gives fast track authority for tax reform legislation
Energy and regulatory reforms to promote economic growth
Includes pretty much every jobs bill we have passed this year and last Congress
All of these policies have important positive economic effects.
Coal Ash regulations
Energy production on federal lands
EPA Carbon regulations
Regulatory process reform
Consent decree reform
Blocking Net Neutrality
Mandatory Spending Reforms
Mostly from the sequester replacement bills we passed last year
Federal Employee retirement reform
Ending the Dodd Frank bailout fund
Transitioning CFPB funding to Appropriations
Child Tax Credit Reform to prevent fraud
Repealing the Social Services Block grant
Health Spending Reforms
Means testing Medicare
Repealing a Medicaid Provider tax gimmick
Altering Disproportion Share Hospitals
Repealing the Public Health trust Fund
First, the debt ceiling or debt limit:
doesn’t authorize new spending; instead, it provides the funding to pay for spending commitments that Congress has already made. The Treasury can’t issue new debt once the limit has been reached, but it can forestall a crisis for several months via stop-gap measures. Once these measures are exhausted, the government would be forced to slash spending - an outcome that could result in a partial government “shutdown” and/or a debt default (i.e., the failure to make interest and/or principal payments on time).The mere threat by Republicans to refuse to raise the debt ceiling in 2011 were a major factor in the downgrading of the USA's credit rating being lowered by Standard & Poor that year. As The New York Times summarizes today:
Economists of all political persuasions have warned that a failure to raise the debt ceiling by the Treasury’s deadline of Oct. 17 could be catastrophic. The world economy’s faith in the safety of Treasury debt would be shaken for years. Interest rates could shoot up, and stock prices worldwide would most likely plummet.In other words, the Republicans in Congress are, effectively, demanding that President Obama surrender his entire agenda, every victory from his first term, or they will crash the economy like the Titanic into the iceberg. On purpose. Even though he was just re-elected, and the House is only in Republican hands through gerrymandering--as the GOP itself acknowledges--they will dash the U.S economy into the rocks unless he surrenders unconditionally. Because if they win this time, they will do it again next year. And the year after. And the year after that.
“Defaulting on any obligation of the U.S. government would be a dangerous gamble,” Doug Elmendorf, the director of the nonpartisan Congressional Budget Office, told the House Budget Committee on Thursday. “In a very uncertain world, the one thing everyone has been able to count on is that the U.S. government will pay its bills on time.”
There is only one proper answer to them:
Ronald Reagan was right to deplore negotiating with terrorists, although he later was forced to admit he did just that. Today, his party is playing the part of those with whom Reagan negotiated, against his own precepts. So far, the White House is treating them as such, quite rightfully.
Stay the course; no deal, Mr. President.