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The McConnell Debt Plan

July 14, 2011 - by Donny Shaw

At this point we’re pretty much all aware that raising the debt ceiling is nothing new. Democrats do it and Republicans do it. It’s been done 9 times in the past decade, and corralling the votes to pass the increases each time has been treated as a burden of the majority. The unique problem this time around is that Congress is split between the parties and it’s not clear who the majority is. But regardless of the politics of the situation, it’s something that pretty much everyone in Congress agrees must be done. And that’s the reality that Senate Minority Leader Micth McConnell’s [R, KY] plan, which seems to be the leading proposal right now, reflects.

Final details of the plan have not yet been released, but you can read the basic outline here. Essentially, it would hand the power to increase the debt ceiling over to the President, give Congress the ability to mount (mainly symbolic) challenges to increases, and require the President to submit a hypothetical plan for offsetting increases with spending cuts. As I see it, the basic qualities of the McConnell plan are:

  • Replaces the concrete spending cuts that Republicans had reportedly won in negotiations with a plan to force the Democrats into tought votes for the sake of political gain.
  • Allows the debt ceiling to be increased without needing to round up Republican votes — solves problem of burden of majority in a split Congress by handing more power over to the Executive.
  • Forces Democrats to go down on the record in favor of debt ceiling increases severl times before 2012 elections (i.e. against the resolutions of diasapproval that the GOP will inevitably launch as the three tranches of debt ceiling increases are implemented.
  • Can be passed without apeasing unpopular positions of Tea Party freshman. As long as leadership in both chambers agree to bring it to a vote, the legislation handing debt ceiling increase authority to the President can be approved with Democratic votes only.

That’s that. It would allow the debt ceiling to be raised by $2.5 trillion before the 2012 elections with zerio in offsetting spending cuts or revenue increases being required. From a policy perspective it’s a total cave for the Republicans. If they go with this proposal, they’re banking on a political win. McConnell has basically admitted as much. “My first choice was to do something important for the country,” he said on Tuesday. “But my second obligation is to my party and my conference to prevent them from being sucked into a horrible position politically that would allow the president, probably, to get reelected because we didn’t handle this difficult situation correctly.”

Right now, Republicans are still publicly calling McConnell’s plan their “last choice.” But with total gridlock on a bigger deal and a Moody’s downgrade of the U.S. credit rating looming it’s looking increasingly likely to form at least the basic shape of what finally ends up happening.

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Comments

  • refagra 07/14/2011 9:51am

    I am disgusted by the way our Congress is behaving. They were hired to do a job – to solve national issues and pay for them. They are doing neither. They weren’t paid to go to Washington, meet behind closed doors and sign agreements with other conspirators to extort fellow members of Congress and the President to enact the agenda of a small, fringe element of the public!

    Although there is no process for removing non-producing representatives from office, there should be. They truly do a disservice to our country at a time when tough decisions must be made or we stand to lose the respect of other world powers.

  • luminous 07/14/2011 1:15pm

    Pelosi is smarter then that, she would simply have her caucus vote present the same way she did with the republican budget which forced a whole bunch of republicans to switch their votes to prevent its passage(and use in tv ad’s against them). No matter what games the republicans make with the voting procedure it is simple enough for the minority to step back in the house and force the majority to be the majority.

    Unless of course their is some parliamentary rules I am unaware of? Donny any idea on that one?

    However either way even if the Dems take the vote I am not so sure that would be held up as a negative against them, The ad’s would follow the line that the majority made the minority the majority for this vote because they where to cowardly, would be easy sell I think. Seems to me that the republicans are digging themselves one hell of a hole, what idiots to give democrats a position that could be a positive while held against them as a negative.

  • fakk2 07/14/2011 6:31pm

    Luminous,

    Republicans control only 1/3 of the federal government (House), Democrats control 2/3 of the government (Senate & Presidency). There is no “making minority majority” flip-flop going on here. The issue isn’t even a Democrats versus Republicans issue (sounds like a twilight zone version of Plants vs Zombies), this is a spending issue. the government rakes in $2.6T each year. If the President and Democrats wanted SS checks to be sent out, even without raising the debt limit, we’d have enough money to do so. We’d cut 3/4 of government (EPA, DOE, etc), but we’d still have enough to pay our seniors, pay our entitlements, and pay our defense, pay for what government should be doing and then some. We can’t keep going like this. We’re already 19.12 times more than what we take in each year in debt. At our current levels, it’d take over 20 years to pay off. How much more debt do we want to get into?

  • valleri 07/14/2011 10:31pm

    They can raise the debt ceiling, raise or lower taxes, spend a trillion more in economic stimulus packages and it will not solve the economic problem our country faces. Is it any surprise we are on the verge of economic collapse when China’s economy is growing at a rate of 9.5%?

    Americans, in their rush to save a buck, have failed to look at the true cost of buying foreign made products. Sure, we may save a few dollars at the point of sale, but it will cost us in lost jobs, higher taxes to accommodate for millions being out of work and not paying taxes, higher crime rates and major cuts to social programs that Americans have counted on to help them in their golden years.

    The politicians in D.C. need to deal with the immediate budget problem then swiftly move towards bipartisan efforts to safeguard what is left of our economy. Everything we buy is made in China – from toys to the two week old ice cube tray I broke today trying to get the last ice cube out of. Enough is enough!

  • luminous 07/14/2011 11:37pm

    Republicans control the house no matter who has the rest of the government, if the house can’t pass something then the republican majority is the problem not the POTUS or US Senate.

    “We’d cut 3/4 of government (EPA, DOE, etc), but we’d still have enough to pay our seniors, pay our entitlements, and pay our defense, pay for what government should be doing and then some.”

    The first thing cut will be “Tax expenditures”, you know deductions/credits/write offs/subsidies, not a single program ran by the government will be cut one cent because of this. What will happen is that corn subsidies, oil subsides, coal subsides, employment hiring credits, etc will be cut.

    Their are a couple trillion worth of these “Tax expenditures” that can easily be cut, republicans attempts to undermine the tax system over the years has given Obama a large amount of room to work with.

    Closing any of our 159 foreign military bases would help, and the $1.2 trillion dollar military budget is ripe for cuts.

  • HildaSuf 07/20/2011 4:27am

    The Republicans’ should not cave – the Democrats should have to defend their claim to resist cuts to federal expenditures/excess (cutting healthscare would really help)- at the same time people are supposed to support keeping the overpowerful federal government healthy.
    We need more bureaucracy to fix the problems that existing bureaucracy is not fixing – Ohio’s Richard Cordray to lead consumer agency – probably just as good of an idea as financial “reform” agencies, healthscare tax preparation, and unfunded EPA mandates.

  • richarddelta 01/16/2012 11:40pm

    i suppose the debt plan is fair.
    Best slow cooker

  • HildaSuf 02/07/2012 3:20pm

    “…if the house can’t pass something then the republican majority is the problem not the POTUS or US Senate …” – The Republican majority in the House has passed many bills – the problem is Reid deems most Republican thought Dead On Arrival – the Senate is the problem, not the House.

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