It seems like the Tea Party is actually rooting for us to default on our debt. They're already guaranteed to get huge spending cuts but with a default they believe a crisis situation will force the government to eliminate most social programs and even most federal spending. How does you rationally negotiate with a faction that has no interest in negotiating?
You can't, and that's the problem. Tea Partiers don't seem to understand that a default could cause a global economic crash, or that even a near-default would surely raise interest rates for years to come -- which materially affects each and every one of us.
If Congress doesn't raise the debt ceiling, then we'll have laws in direct conflict with one another (legal spending vs. a legal debt ceiling). Shouldn't the courts (maybe the Supreme Court?) settle this, perhaps by directing Congress to raise the debt ceiling, or abolish it entirely?
There would be another legal mess, too: Which creditors get priority? Would t-bill holders get paid first? Social Security recipients? Government contractors (who have legal agreements to be paid certain amounts by certain dates)? How would the courts sort all this out?
A year ago, the Democrats held comfortable majorities in both the House and Senate, as well as the White House. What excuse do they have for not having dealt with this issue last year? I interpret their strategy as "Let's wait until the Republicans win the House, then trash them for the unpopular cuts the propose."
If you have read my columns or regularly followed this chat, you know that I've slammed the Democrats on many occasions for not taking care of business -- such as passing a budget -- when they had the majorities to do so. They should have taken care of the debt ceiling, too.
Your column presented a side of the discussion that the President is trying to work out a solution while the Republicans are just blocking. What I have read is that indeed the Republicans are blocking but so are the Democrats. How is taking anything off the table not blocking? Everything (military, medicare, Congressional pay, etc) should be on the table. And what plan has the President presented aside from "trust me in 10 years things will be better"?
Democrats haven't taken anything off the table. They'd like to take Medicare and Social Security off, but they haven't issued any ultimatums or said they're not willing to negotiate. Republicans, by contrast, will not discuss new revenue of any nature. That's not me talking, that's what they say -- no deal that is "revenue-positive." Sorry, but being grumpy about the deal isn't the same thing as being definitive.
Congress isn't actually going to let the Aug 2 deadline pass without fixing this, are they? I mean, really - are there enough of them that place politics over the economic wellbeing of millions to actually do that? I'm incredulous that we're at the point where we are, which is why I'm so nervous about it.
Most days, I tell myself that no, they can't actually go through with this tragic farce, they'll find a way to get past August 2 without a default. Some days, I wake up and say wow, it's hard to believe but they're actually going to drive the nation off a cliff. Today I'm having one of those Thelma-and-Louise days, but maybe this chat will make me feel better.
Eugene, back in your June 27th article, you said democrats need to exercise patience in raising tax revenue, because it would be bad for the economy at this time... but now here you are saying Republicans need to allow tax increases / reduce tax deductions. Why the change of heart, or is this just a flip-flop.
Let's be fair, now, and look at what that earlier piece really said. My opinion was, and is, that with the economy struggling to climb out of recession, this is a bad moment for budget cuts or tax increases. I've repeated that blanket admonition several times. I've also said, however, that if we are going to tackle debt-reduction now, we need a balanced approach; I've noted that spending is well above historical levels, as a percentage of GDP, but that tax revenue is well below historical levels. I should also note that in terms of possible impact on the recovery, budget cuts will do much more to slow the economy than the modest tax increases being talked about.
OK, so what can we mere citizens do to get this mess fixed? How likely is it that writing/calling our Congressional representatives will actually help? My rep is a Republican, how likely is he to care that I want him to get something done?
He won't care at all about your opinion if you don't tell him. So call or write. Members of Congress pay attention to their constituents.
I thought the larger problem in 2009/2010 was that the Senate GOP was using the fillibuster in an unprecedented way to block all legislation. Weren't literally hundreds of House bills left languishing? How is that the Dem's fault? Was it because they were too ideological and unwilling to negotiate reasonable terms with the Republicans?
Not entirely. Democrats were not anxious to take some votes before the election that might have given Republicans new ammunition.
How can you blame the Republicans for not budging when they won a landslide mandate, at least in the House, based on the negotation strategy they're employing -- cutting federal spending and holding the line on taxes. Perhaps it's the Democrats who are being intransigent to the will of the electorate.
"At least in the House." See, Democrats were given control of the White House and the Senate. By the electorate.
What about the 14th Amendment option that has been brought up recently?
Some legal scholars say the 14th Amendment mandates that the president do whatever he needs to do -- including additonal borrowing -- in order to avoid a default. Other legal scholars disagree. The official stance of the administration is to downplay this option, if indeed it is an option. President Obama has not addressed the issue publicly.
Here's what I don't understand: Who's going to win if the GOP doesn't play ball? If we assume the GOP is representing the interests of American business/Wall Street, why are they so cavalier about defaulting? Could it be that someone behind the scenes has already run the numbers and Big Business somehow comes out better after we default but still with low taxes? Or does everyone that attends Grover Norquist's Wednesday morning meetings already know that they're going to cave at the last minute, so don't worry? There has to be a grand plan by the GOP here, no?
You're being logical, and I'm not sure that logic is much of a guide. Default would be a disaster for the Wall Street and Main Street business communities. Nobody comes out better. Maybe business leaders think this is just hard-nosed negotiation, and in the end everybody will act in clear self-interest and raise the debt ceiling, as needs to be done. That's what should happen, but like I said, sometimes I don't see how we get there.
Raising taxes is not a requirement to raise the debt ceiling, yet the Democrats refuse to raise the debt ceiling without raising taxes. What about Obama's rejection of a short-term deal? Why do the Dems get to say "no" by the GOP does not?
Wait, wait! Stop the presses! You mean the GOP-controlled House is ready to send President Obama a clean bill that does nothing but raise the debt ceiling? Then our long national nightmare is over. Oh, I forgot, the GOP refuses to raise the debt ceiling without deep budget cuts. My bad.
Boehner says $4Trillion with revenue increases can't pass the House. What he means is that it can't pass his caucus. There are about 180 Democratic votes in play here too. Let's say with all the teeth-gnashing and hand-wringing that Pelosi can deliver 2/3 of the Democrats, about 120 votes. Boehner doesn't need the Tea Party faction to pass such a bill. Leave the 90 or so recalcitrants aside. Boehner ought to be able to deliver 100 of the remaining adults for a total aye vote of 220. Bill passes. If Boehner can't deliver 100 of his own caucus for a bargain that he commits to then, perhaps, he doesn't deserve to be Speaker. Is he THAT weak of a leader?
This is the kind of calculation that Speaker Boehner must have gone through in his head, oh, about a million times. In the end, I think he believed he was losing more than the recalcitrants. The caucus was slipping from his fingers, with Eric Cantor right there to grab it.
Do you agree with your former colleague at the Post, Howard Kurtz, who seemed to say in his recent piece for the paper that the scandal around the News of the World is just a more dramatic version of what most journalism has become now? It seemed an odd defense to me. Even if legitimate papers/broadcast media are paying for stories, I don't think that's the same thing as bribing cops to get dirt on the Royal Family or Prime Minister.
I don't think so, either. I accept the point that journalism is on a slippery slope, in terms of paying for stories (something this newspaper would never do), but it's not the same thing as bribing cops -- or even blackmailing cops -- and illegally hacking into cell phones.
I've been following with interest Rupert Murdoch's troubles in the UK. What do you think is the likelihood that the scandal will reach News Corp.'s US holdings, and in particular Fox News?
I doubt it will reach Fox News. The network doesn't break a lot of tabloid-style stories -- it doesn't break a lot of stories at all -- which suggests to me that it's not resorting to the NotW's illegal but highly effective methods. In terms of other holdings, however, there are some U.S.-based executives who once worked in London and now be in a spot of bother.
Applies to the current crisis but has much wider application: Do you believe (as I do) that strict term limits for everyone - president down to the county clerk - would go a long way to incentivising elected officials to "do what's right" then go back to their way of life?
The presidency, you will recall, is term-limited. As for Congress, I don't know. I understand the temptation, but the problem with term limits is that it takes time to figure out how the government works. Why? Because it's big and complicated. Why? Because this is a big, complicated country. It made more sense to think of term limits in the early days of the republic, but even then there was merit in experience.
It seems to me that this is one giant game of chicken, and the first to blink loses. And if the Republicans do not care about the consequences of defaulting (or think that the consequences will be minor) then they have no incentive to blink. It strikes me that the Democrats are up against a wall, that they have to make a move. My question is, if the revenues are off the table, how can both sides possibly come to a resolution? What will the Republicans accept? If Democrats offer to go back to the 2.5 million deal, what is to stop the Republicans from saying, "we want more, let's go back to the 4 million number, but still no revenues"?
The thing is, though, that Republicans do have a lot to lose if there's a default. Everyone does -- but the GOP might well suffer the most, as it's clear that all other parties are willing to compromise. We shall see.
That's all for today, folks. Thanks so much for participating in a lively hour, and I'll see you again next week.