Enter Stage Right
by digby
They're coming out of the woodwork now with silly plans to "leverage" the debt ceiling vote to supposedly force Democrats to compromise and enact their preferred spending cuts. This one by the new Tea Party/Club for Growth radical Senator Pat Toomey, is a doozy. He's basically proposing to pass a law which will require that in the event of the debt ceiling not being raised, all interest owed to bond holders must be paid first (so as to ensure the business and markets don't feel "uncertainty" dontcha know.)Meanwhile, the rest of the budget would have to be slashed by at least a third, with massive, immediate cuts to programs. He doesn't want to have to do this ...
Projects would be postponed, some vendor payments would be delayed, certain programs would be suspended, and many government employees might be furloughed. Default would easily be avoided, but these cuts would certainly be disruptive. That's why I hope we can avoid this scenario.
But it would be even worse simply to raise the debt ceiling without regaining control of federal spending. The recent surge in spending, both in absolute dollars and as a percentage of our GDP, has driven us to record deficits and an explosion of debt. The growth in discretionary spending has been the most dramatic, but in the future mandatory entitlement spending will be the deficit driver. Congress must address both in order to put the government back on a sustainable fiscal path.
The vote on whether to raise the debt ceiling—and, if so, by how much—is our best opportunity to insist that any increase in our nation's debt be coupled with concrete steps toward fiscal sanity. Congress should make increasing our debt contingent on immediate cuts in spending and effective reforms of the spending process that helped get us into this mess.
Remember: the Republicans have no leverage. They know they cannot refuse to raise the debt limit and Eric Cantor has already made that clear to his fractious teabaggers. The President can veto any nonsensical bill like this. The Senate doesn't have to pass it. Any capitulation is unnecessary. If they do it, it's because they are pretending that the Republicans have taken a hostage, not because they actually have one.
It's going to be quite entertaining to watch these kabuki dances over the next few months. I only wish I had more faith that the Democrats weren't going to jump on stage and join in.
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