Entries Tagged as 'House Republicans'

Boehner is Trapped by His Caucus

December 21st, 2011 at 1:09 pm 46 Comments

An old joke heard often in the Southwest ends this way: “It isn’t always your enemies that get you into it; it isn’t always your friends who get you out of it; but, purchase when you are in it up to your neck, keep your damned mouth shut.”

Unfortunately, Speaker John Boehner’s predicament confirms again the truism above.

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The New Payroll Tax Strategy

December 12th, 2011 at 2:29 pm 84 Comments

House Republicans have made a bid to boldly reverse their public relations disadvantage as gridlock over the extension of the payroll tax holiday and other legislation vital to the economy continues.

For the past month or more, ask Republicans had been scolded as the bastion of the rich and privileged. Democrats wanted to increase taxes on the successful, click using those new taxes to continue long-term unemployment insurance, see a broadened payroll tax holiday, and to insure that health care providers under Medicare don’t take an overnight 27 per cent cut in payment for services.

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GOP Should Act Like a Majority Party on Debt Limit

July 29th, 2011 at 2:14 pm 7 Comments

Upon hearing reports that Jim DeMint played a role in the House’s failure to hold a vote last night on the Boehner Plan, I recalled an episode that occurred during the Reagan administration while the Republicans controlled the Senate.  I was interning with none other than Senator Christopher Dodd (even then they called me “the right-wing intern”).  Say what you want about Chris Dodd – his staff was bright and funny and made up almost entirely of pros.

At the time, Jesse Helms – then known as “Senator No” – was the most right-wing senator.  Senator Helms had such an old-school view on debt that he did not even have a credit card.

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The Cost of the Crisis

David Frum July 28th, 2011 at 7:07 am 39 Comments

The forcing of a debt-ceiling crisis seems likely to have permanent consequences, patient even if it is settled before Default Day, healing reports Bloomberg News:

Conviction that lawmakers will fail sent rates on bills due next month to the highest level since March 31, data compiled by Bloomberg show.

“The politicians should learn from this that they shouldn’t wait until we have our backs against the wall,” Donald Selkin, New York-based chief market strategist at National Securities Corp., said in a telephone interview. Selkin, a 35-year Wall Street veteran, helps manage about $3 billion. “It’s very irresponsible because it can affect the economy and jobs. They’re putting us in a situation where we could have another financial meltdown.”

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Resume the Debt Debate in 2012?

David Frum July 25th, 2011 at 7:45 am 61 Comments

So here’s the new Republican debt-ceiling idea:

Pass a $1 trillion increase in the debt ceiling joined to $1 trillion in spending cuts over the next 10 years, no revenues.

That sounds dramatic. But $1 trillion in spending cuts over a decade is not as big a deal as it sounds, especially if you are allowed to be vague about them. And a $1 trillion debt ceiling increase carries the United States government only into the early part of next year, meaning that this debate will recur in 2012.

House Republicans apparently regard the early renewal of the debt-ceiling debate as a feature, not a bug. It means that they can resume the debate over debt and deficits in the election season.

Except – I thought the 2012 election was supposed to be about the economy? Jobs and the Obama administration’s disappointing record of creating them?

Isn’t that the winning issue?

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Obama’s Weakness Made Debt Crisis Worse

David Frum July 5th, 2011 at 11:17 am 82 Comments

In my latest column for CNN, I discuss how president Obama’s weakness in his negotiations over the debt ceiling have made the debt crisis worse:

Why aren’t the Democrats rebelling?

The debt ceiling negotiations have amounted to a succession of retreats and concessions by President Obama.

At this point, the president confronts two possible outcomes in the coming weeks:

Outcome 1: The president and congressional Republicans reach agreement on a budget package weighted overwhelmingly in favor of the GOP. The president opened negotiations by offering $3 of spending cuts for every $1 of tax increases. His current offer tilts even further to the GOP: $6 of spending cuts to $1 of tax increases.

Better still (from a Republican point of view), the spending cuts come from programs Republicans dislike, like Medicaid, rather than programs they like, like the farm budget. The tax increases meanwhile are designed to be as acceptable as possible to the GOP: no increases in tax rates, but instead trimming some of the less defensible deductions in the tax code.

Outcome 1 represents a very big win for Republicans over the future shape of the federal government, and a correspondingly big defeat for the president.

Outcome 1 also represents the president’s best-case scenario.

The worst-case is Outcome 2. Republicans reject the president’s concessions as insufficient. They refuse to lift the debt ceiling. Denied the legal authority to borrow further, the federal government exhausts its cash sometime in the next three to four weeks.

At that point, the United States will face some kind of federal bankruptcy: paying some claims, deferring others, plunging the U.S. government into financial crisis and probably plunging the whole world into renewed economic crisis.

How in the world did the president arrive at this disastrous predicament?

You can blame his opponents if you want. Yes, the House Republicans have played politics very rough. Not since the era of the Vietnam War has a house of Congress used the threat of national bankruptcy to gain its way on a policy point.

But the roughness of the president’s opponents does not excuse the president’s own mistakes and weakness. On the contrary: from the point of view of the president’s supporters, the roughness of the president’s opponents makes all the more inexcusable the president’s mishandling of the situation.

As Marc Ambinder of the National Journal suggested at the time, the president could have included an increase in the debt ceiling in the December deal to extend the Bush tax cuts. The Republicans dearly wanted that extension. Obama did not use leverage when he had it — and so he became a victim of leverage when he lacked it.

Then, as Republicans discovered the power of their new tool, the president decided to assume they were bluffing, that they would never actually do anything so reckless. Waking up to the reality of the situation too late, he commenced bargaining by offering what he assumed would be an irresistible deal. Wrong again. The Republicans did resist. So Obama offered an even better deal — which predictably only whetted the GOP appetite for still more.

Obama never publicly branded the debt ceiling as “if the Republicans force this country into bankruptcy.” He issued no public call to constituencies like the financial industry to bring pressure to bear on the issue. He did not warn that he would manage any crisis in ways that Republicans would not like. (“If the Republicans in Congress deny me the authority to pay everybody, then I’m going to have to choose some priorities. I don’t think it’s likely that Texas-based defense contractors will find themselves at the top of my list.”)

Instead, he appealed again and again to Republicans’ spirit of responsibility. Good luck with that.

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GOP Gets Budget Cuts Even Without Shutdown

April 4th, 2011 at 12:00 am 20 Comments

Three quick thoughts about the possibility of a government shutdown which could happen on Friday if Democrats and Republicans can’t agree on a budget:

1. It’s probably not going to happen because neither side has a clear political advantage in forcing a shutdown. If anything, the calculus for a shutdown favors the Obama administration and they seem not be to raring for a fight right now.

2. Republicans have clearly won the debate over domestic discretionary spending and will get genuine cuts. This doesn’t really solve any underlying fiscal problems since domestic discretionary spending is only about 15 percent of the budget. So long as they get the direction of domestic spending pointing in the right direction (downward in absolute terms) the precise magnitude of the cuts isn’t that important. At some point, calling for more cuts is going to be a political liability with just about everyone since a fair number of popular, necessary-in-some-form services like courts, food inspection, air traffic control, and interstate highways are in the domestic discretionary budget.

3. If Republicans actually want to make a fiscal difference, they should agree to a longer-term continuing resolution or budget that might even throw a few bones to the Democrats. This will let energetic new GOP members turn their attention to the far more pressing issue of reforming the budget-busting defense and entitlement programs.