The WTF do we do now moment --- for Democrats
by digby
Greg Sargent reports that the House Republicans are digging in on no new revenues and lays out their final choices:
As Ezra Klein notes, it’s still unknowable: “what no one quite knows is what the House GOP will accept when the clock is one minute from midnight, or, in more pessimistic tellings, the Dow is 1,000 points below whatever it was at the day before.”
This “WTF do we do now” moment can take one of two forms: Either House Republicans agree to new revenues, or they agree to the McConnell proposal. But one of those two things has to happen. And that moment is almost upon us.
There is another "WTF do we do now" scenario: Democrats agree to more spending cuts with no tax hikes. Is it really so impossible to see them doing that under these same "Armageddon" pressures? Particularly when their President and the Democrats in the Senate are all eager to do "tax reform" down the road?
Assuming they don't hammer out a Grand Bargain that the Republicans can get behind (which I still think is very possible) if Boehner and the President come up with a last ditch plan to cut more spending with say, a non-binding promise to talk about tax-hikes in the future (something the Village will be thrilled to endorse as a perfect bipartisan agreement) and maybe some UI, I just don't see the House Democrats being the ones to hold out and let the country default. They just aren't crazy enough (and everybody knows it.)
We already know that there are 1.5 trillion in cuts agreed to under the McConnell plan. The Republicans are demanding 2.4 and the Democrats say the difference must be in the form of tax hikes. What if they agree to split the difference?
Andrea Mitchell just tweeted:
Budget Chair Paul Ryan on show -I think we should grab the spending cuts we can right now. Says there has been lot that is constructive.
(If he thinks it's constructive ... watch grandpa's wallet.)
Considering what we've been watching for the past two months, I wouldn't be the least bit surprised if 2 trillion isn't the real fallback. Pushed against the deadline, I can easily see the Dems being arm twisted as long as there's some band-aid they can throw on it afterwards. After all the talk about 4 trillion and massive cuts to entitlements, they'll even spin it as a "win." (And anyway, there's now the Gang of Six budget talks ahead in which everyone can pretend to be really, really serious about raising revenue in exchange for a thorough shredding of the safety net. It's all good.)
The President and the speaker badly want a deal to show for all this sturm und drang. So it's a matter of which House caucus will blink first in the countdown to Armageddon. If you were a betting person, which side would you bet on?
Update: This just in:
A Congressional aide briefed on ongoing negotiations between House Speaker John Boehner and President Obama says the two principals may be nearing a "grand bargain" on to raise the debt limit which would contain large, set-in-stone spending cuts but only the possibility of future revenue increases.
"All cuts," the aide said. "Maybe revenues some time in the future."
[...]
A White House spokesman called the claims from aides "not credible" -- the result of having a "3rd hand version of the facts."
However two aides and a third source, close to the principals confirmed that Obama has been emphatic with Democratic negotiators that his preference is to negotiate a big deal with Boehner and squeeze it through Congress.
Lacking still, including among Democratic sources, is any sense of what's in the still-forming plan -- vis a vis both spending and revenue. And Democrats, particularly in the House, will have a lot to say over whether the deal is acceptable -- their votes will be necessary for Boehner to pull off a grand bargain.
Again, anyone want to bet on them being "crazy" enough to defy their President and default on the debt?
(On the other hand, who knows if this is true --- it ain't over til it's over. But if it is true, I was definitely channeling the zeitgeist. I wrote this piece immediately after Sargent posted this morning at 9:30 my time.;)
.