YGLESIAS
Apr 13th, 2011 at 10:27 am
The Senate And The Debt Ceiling
As long as we’re taking hostages, I don’t see what’s stopping Democratic Senators—who, after all, constitute a majority—from starting to talk about what concessions they’re planning to demand in exchange for a debt ceiling increase.That would be the ideal negotiating framework. White House demands clean debt ceiling increase, House majority demands big spending cuts, Senate majority demands partial repeal of Bush tax cuts, and we all compromise on just doing the damn debt increase.
Rick Mckay/Cox Washington Bureau
Saxby Chambliss, a Republican.
The Sunday New York Times front-paged the work the bipartisan “Gang of Six” is doing in trying to forge a deficit-reduction compromise. “As Mr. Obama and Republican leaders have warred publicly over the budget, this small group of senators has spent four months in dozens of secretive meetings in offices at the Capitol and over dinner at the suburban Virginia home of Senator Mark Warner, a Democrat. The senators have weathered criticism from bloggers and even colleagues, including the leaders of their own parties, who oppose tampering with Social Security or taxes. The gang nearly collapsed several times, including two weeks ago.”
Bloomberg News notes how Tea Party freshmen are heading home to sell their votes in favor of the Ryan budget plan, which -- among other things -- phases out Medicare. The budget fight spotlights the political risk confronting Republicans as Washington intensifies its focus on the long-term government deficits that will shape the country’s economic future and frame next year’s elections. How Republican leaders balance the expectations of Tea Party activists, who’ve pushed for cuts in popular programs including entitlements, with the need to protect vulnerable members in swing districts will define the party in the 2012 elections.
Elizabeth Drew on the Washington budget battle: "The possibility of a bipartisan 'Grand Bargain' has grown dimmer, given the lines that have now been drawn, and the Republicans’ perhaps inevitable hyperbole about the President’s speech, which they denounced as 'partisan' (Heavens!) and a campaign gimmick. They could not entertain the possibility that Obama’s was a serious, thoughtful offering. The House’s adoption Thursday of the deal made between Obama and House Speaker John Boehner last Friday offers a glimmer of a possibility of compromise on much larger issues, but if the past is prologue, they would be compromises essentially on Republican terms.
On Sunday, Speaker John Boehner’s press office announced he was leading a congressional delegation to Iraq.
By Patrick O’Connor and Damian Paletta
“Gang of Six” members reacted to the news Monday that Standard & Poor’s had downgraded its outlook for U.S. debt with grim warnings about the country’s financial future.
“This is one more warning sign that the financial markets are paying close attention to see if we are serious about addressing our budget deficits and long-term debt,” said Sen. Mark Warner, a Virginia Democrat involved in the bipartisan talks aimed at reaching a compromise on how to close the budget gap. “If we fail to take this seriously, and if our deficit and debt discussions turn into just another game of political brinkmanship, this could result in the most predictable economic crisis in our history.”
The S&P downgrade served as a real-world reminder that bond investors care what Congress does – or doesn’t do. And that bolsters the argument Mr. Warner and others make as they prod colleagues to forfeit a political fight in exchange for a deficit reduction package that maybe one day would balance the budget.
“Today’s warning from S&P highlights the dangers of waiting for the perfect political moment to tackle our debt crisis,” said Oklahoma Sen. Tom Coburn, one of three Republicans in the “Gang of Six” talks. “Waiting until the next election puts our fiscal and national security at risk. It’s time for both sides to drop their partisan talking points and decide what we can do together while we still control our own destiny.”
Mr. Coburn further warns that if the two parties can’t work out a compromise, “We will soon find ourselves negotiating with foreign governments and the international financial community.”
The Gang of Six senators include Messrs. Warner and Coburn, along with Republicans Saxby Chambliss of Georgia and Mike Crapo of Idaho and Democrats Dick Durbin of Illinois, the Senate majority whip, and Budget Committee Chairman Kent Conrad of North Dakota. They have been in talks to introduce legislation mirroring the conclusions of the president’s own deficit-reduction commission. That would include cutting spending, revamp popular entitlement programs like Medicare and Medicaid and possibly even raising taxes on some industries and individuals through a comprehensive reform that seeks to lower the overall corporate rate.
In a typical climate, this plan wouldn’t survive its first press conference. But this year is different.
Erskine Bowles, who co-chaired the White House’s deficit-reduction panel last year, said in an interview that the S&P warning should be “no surprise whatsoever” to officials in Washington or Wall Street.
“The outlook is negative if we do nothing,” he said. “If we make some of these changes that have come forward in some of these plans, then the outlook is bright. Its just more validation that this crisis we face is real.”
He doesn’t seem to suggest the bond markets will give negotiators much room for error.
“When the market really digests this, and if they ever decide that we aren’t serious about facing up to our long-term fiscal problems, then the reactions will be severe and they will be very quick,” he said.
Whether the so-called Gang of Six can actually deliver something when Congress returns from a recess in May could determine whether Democrats and Republicans can come together to resolve the nation’s fiscal problems before the 2012 elections.
As Mr. Obama and Republican leaders have warred publicly over the budget, this small group of senators has spent four months in dozens of secretive meetings in offices at the Capitol and over dinner at the suburban Virginia home of Senator Mark Warner, a Democrat.
The senators have weathered criticism from bloggers and even colleagues, including the leaders of their own parties, who oppose tampering with Social Security or taxes. The gang nearly collapsed several times, including two weeks ago.
The group’s oldest members — Senator Richard J. Durbin, 66, a progressive from Illinois who counts the Senate’s only socialist as a friend and ally, and Senator Saxby Chambliss, 67, a genial Georgia conservative whose nasty first campaign left lingering bad feelings among Democrats, and who is a confidant of Speaker John A. Boehner — illustrate that even with the mounting federal debt intensifying the partisan divide over spending and taxes, the severity of the fiscal threat is forging unlikely alliances.
If Mr. Durbin and Mr. Chambliss can cut a deal on Social Security and new tax revenues, their associates say, then just maybe all of Washington can come together.
For Republicans, that means accepting higher taxes and lower military spending. For Democrats, it would mean agreeing to curbs on the unsustainable growth of Medicare and Medicaid spending, as well as tweaks to Social Security, to avert a big shortfall in 2037 and as a trade-off for Republicans’ support on taxes.
Mr. Durbin and Mr. Chambliss reached those conclusions last year, each confronting the widening annual gaps between projected revenues and spending as the population ages and health care prices rise.
Mr. Durbin, the No. 2 leader in the Senate, was on Mr. Obama’s bipartisan fiscal commission, which recommended some solutions. Mr. Chambliss had joined informally with Mr. Warner to host private tutorials for Senate colleagues of each party with experts like Ben S. Bernanke, the Federal Reserve chairman.
The two senators’ paths merged last December.
Several months ago, with Mr. Durbin as its most surprising yes vote, 11 of the 18 members of the president’s fiscal commission backed a blueprint to pare $4 trillion from projected deficits in the first decade. It would cut domestic and military spending; curb Medicare and Medicaid; and overhaul the tax code, limiting or repealing tax breaks and using the new revenues to lower tax rates and reduce deficits. Separate from its debt-reduction plan, the panel proposed benefit and payroll tax changes to stabilize Social Security for 75 years.
Immediately, Mr. Chambliss and Mr. Warner enlisted four senators from the commission majority to negotiate writing the recommendations into legislation. Besides Mr. Durbin, the others were Senator Kent Conrad, a North Dakota Democrat who leads the Budget Committee, and Senators Tom Coburn of Oklahoma and Michael D. Crapo of Idaho, both Republicans.
“As I said to a Republican recently,” Mr. Durbin said in an interview, “it’s like we’re on a long flight here and we’ve come so far there’s no turning back — we’ve got to land the plane.”
The effort holds peril regardless of the outcome. If successful, a plan could be taken up as Congress debates this spring over raising the nation’s $14.2 trillion debt limit. But the group is hardly assured of support from Senate colleagues, let alone lawmakers in the House, where Republicans, including dozens of new Tea Party supporters, refuse to consider raising revenues. If the group fails, that would probably signal doom for the broader bipartisan effort Mr. Obama wants.
Mr. Durbin, the liberal Democrat, and Mr. Chambliss, the conservative Republican, may have the most at stake. Mr. Durbin could be isolated in the Senate leadership, and Mr. Chambliss potentially vulnerable given Republicans’ penchant for ousting incumbents who deviate from the antitax line. Neither senator faces re-election until 2014.
An administration official recalled that in early 2010, when Mr. Durbin was named to Mr. Obama’s fiscal commission, another White House official told its co-chairmen, “You’ll never get Durbin’s vote.”
Nine months later, Mr. Durbin announced his support in The Chicago Tribune for the recommendations the chairmen had negotiated with members. “The question my closest political friends are asking is this: Why is a progressive like Dick Durbin voting for this deficit commission report?” he wrote. The answer: “Borrowing 40 cents out of every dollar we spend for missiles or food stamps is unsustainable.”
So, Mr. Durbin added, “when we engage in the critical decisions about our nation’s future budgets, I want progressive voices at the table to argue that we must protect the most vulnerable in our society and demand fairness in budget cuts.”
That has been his mantra with disappointed allies in labor, women’s groups and the Senate. Mr. Durbin, in the interview, cited a private meeting requested by Senator Bernie Sanders, independent of Vermont, a socialist and “a good friend.” Their exchange, Mr. Durbin said, captured the increasing difficulty in being a good progressive “at a time of limited resources.”
Mr. Sanders said he respected Mr. Durbin for his good intentions. “But I think the direction in which he is going in working with some of the most very conservative members of the Senate is not correct,” Mr. Sanders said.
Critics suggest that Mr. Durbin is seeking a new role to counter the prominence of Senator Charles E. Schumer of New York, his roommate and his rival in the Senate leadership.
But Andy Stern, a former labor leader who was on the fiscal commission and opposed its report, defended Mr. Durbin, saying, “It’s classic Washington that we can’t imagine that someone does something because they think it’s the right thing to do.”
That is Mr. Chambliss’s claim as well. “I hear my critics; I pay attention to my constituents,” he said in an interview. “But you’ve got to do the right thing and what’s best for the country.”
And Mr. Chambliss has been increasingly outspoken in arguing that additional revenues must be part of a debt-reduction plan, given the scale of the problem.
“I’m taking arrows from some on the far right,” he told the Rotary Club of Atlanta in an appearance with Mr. Warner on Monday. “Are some people going to pay more in taxes? You bet.”
A bolt came in February from Grover Norquist, a Republican antitax activist, who wrote to Mr. Chambliss, Mr. Coburn and Mr. Crapo to say they would violate his group’s “Taxpayer Protection Pledge” if they supported raising revenues for deficit reduction.
The trio countered the same day, releasing a letter telling Mr. Norquist that their effort broke no pledge “but rather affirms the oath we have taken to support and defend the Constitution of the United States against all enemies, foreign and domestic, of which our national debt may now be the greatest.”
Perhaps more troublesome for Mr. Chambliss have been critics at home like Erick Erickson, a conservative blogger, Atlanta radio talk-show host and CNN contributor. “Is Saxby Chambliss Becoming a Democrat?” Mr. Erickson asked in a recent blog post.
For many actual Democrats, Mr. Chambliss remains negatively defined by his 2002 defeat of Senator Max Cleland, a triple-amputee veteran of Vietnam, after a campaign that included an ad picturing Mr. Cleland with Osama bin Laden. Mr. Chambliss’s work on the Gang of Six has done as much as anything to soften attitudes.
Bloomberg News notes how Tea Party freshmen are heading home to sell their votes in favor of the Ryan budget plan, which -- among other things -- phases out Medicare. The budget fight spotlights the political risk confronting Republicans as Washington intensifies its focus on the long-term government deficits that will shape the country’s economic future and frame next year’s elections. How Republican leaders balance the expectations of Tea Party activists, who’ve pushed for cuts in popular programs including entitlements, with the need to protect vulnerable members in swing districts will define the party in the 2012 elections.
Elizabeth Drew on the Washington budget battle: "The possibility of a bipartisan 'Grand Bargain' has grown dimmer, given the lines that have now been drawn, and the Republicans’ perhaps inevitable hyperbole about the President’s speech, which they denounced as 'partisan' (Heavens!) and a campaign gimmick. They could not entertain the possibility that Obama’s was a serious, thoughtful offering. The House’s adoption Thursday of the deal made between Obama and House Speaker John Boehner last Friday offers a glimmer of a possibility of compromise on much larger issues, but if the past is prologue, they would be compromises essentially on Republican terms.
On Sunday, Speaker John Boehner’s press office announced he was leading a congressional delegation to Iraq.
Philip Scott Andrews/The New York Times
Senator Richard J. Durbin, a Democrat.
Gang of Six Sees S&P Move as Sign to Act Soon on Budget Plan
“Gang of Six” members reacted to the news Monday that Standard & Poor’s had downgraded its outlook for U.S. debt with grim warnings about the country’s financial future.
“This is one more warning sign that the financial markets are paying close attention to see if we are serious about addressing our budget deficits and long-term debt,” said Sen. Mark Warner, a Virginia Democrat involved in the bipartisan talks aimed at reaching a compromise on how to close the budget gap. “If we fail to take this seriously, and if our deficit and debt discussions turn into just another game of political brinkmanship, this could result in the most predictable economic crisis in our history.”
The S&P downgrade served as a real-world reminder that bond investors care what Congress does – or doesn’t do. And that bolsters the argument Mr. Warner and others make as they prod colleagues to forfeit a political fight in exchange for a deficit reduction package that maybe one day would balance the budget.
“Today’s warning from S&P highlights the dangers of waiting for the perfect political moment to tackle our debt crisis,” said Oklahoma Sen. Tom Coburn, one of three Republicans in the “Gang of Six” talks. “Waiting until the next election puts our fiscal and national security at risk. It’s time for both sides to drop their partisan talking points and decide what we can do together while we still control our own destiny.”
Mr. Coburn further warns that if the two parties can’t work out a compromise, “We will soon find ourselves negotiating with foreign governments and the international financial community.”
The Gang of Six senators include Messrs. Warner and Coburn, along with Republicans Saxby Chambliss of Georgia and Mike Crapo of Idaho and Democrats Dick Durbin of Illinois, the Senate majority whip, and Budget Committee Chairman Kent Conrad of North Dakota. They have been in talks to introduce legislation mirroring the conclusions of the president’s own deficit-reduction commission. That would include cutting spending, revamp popular entitlement programs like Medicare and Medicaid and possibly even raising taxes on some industries and individuals through a comprehensive reform that seeks to lower the overall corporate rate.
In a typical climate, this plan wouldn’t survive its first press conference. But this year is different.
Erskine Bowles, who co-chaired the White House’s deficit-reduction panel last year, said in an interview that the S&P warning should be “no surprise whatsoever” to officials in Washington or Wall Street.
“The outlook is negative if we do nothing,” he said. “If we make some of these changes that have come forward in some of these plans, then the outlook is bright. Its just more validation that this crisis we face is real.”
He doesn’t seem to suggest the bond markets will give negotiators much room for error.
“When the market really digests this, and if they ever decide that we aren’t serious about facing up to our long-term fiscal problems, then the reactions will be severe and they will be very quick,” he said.
‘Gang of Six’ in the Senate Seeking a Plan on Debt
By JACKIE CALMES
WASHINGTON — Days after President Obama called for forming a bipartisan group in Congress to begin negotiating a $4 trillion debt-reduction package, the parties have not even agreed to its membership. Yet six senators — three Democrats, three Republicans — say they are nearing consensus on just such a plan.Whether the so-called Gang of Six can actually deliver something when Congress returns from a recess in May could determine whether Democrats and Republicans can come together to resolve the nation’s fiscal problems before the 2012 elections.
As Mr. Obama and Republican leaders have warred publicly over the budget, this small group of senators has spent four months in dozens of secretive meetings in offices at the Capitol and over dinner at the suburban Virginia home of Senator Mark Warner, a Democrat.
The senators have weathered criticism from bloggers and even colleagues, including the leaders of their own parties, who oppose tampering with Social Security or taxes. The gang nearly collapsed several times, including two weeks ago.
The group’s oldest members — Senator Richard J. Durbin, 66, a progressive from Illinois who counts the Senate’s only socialist as a friend and ally, and Senator Saxby Chambliss, 67, a genial Georgia conservative whose nasty first campaign left lingering bad feelings among Democrats, and who is a confidant of Speaker John A. Boehner — illustrate that even with the mounting federal debt intensifying the partisan divide over spending and taxes, the severity of the fiscal threat is forging unlikely alliances.
If Mr. Durbin and Mr. Chambliss can cut a deal on Social Security and new tax revenues, their associates say, then just maybe all of Washington can come together.
For Republicans, that means accepting higher taxes and lower military spending. For Democrats, it would mean agreeing to curbs on the unsustainable growth of Medicare and Medicaid spending, as well as tweaks to Social Security, to avert a big shortfall in 2037 and as a trade-off for Republicans’ support on taxes.
Mr. Durbin and Mr. Chambliss reached those conclusions last year, each confronting the widening annual gaps between projected revenues and spending as the population ages and health care prices rise.
Mr. Durbin, the No. 2 leader in the Senate, was on Mr. Obama’s bipartisan fiscal commission, which recommended some solutions. Mr. Chambliss had joined informally with Mr. Warner to host private tutorials for Senate colleagues of each party with experts like Ben S. Bernanke, the Federal Reserve chairman.
The two senators’ paths merged last December.
Several months ago, with Mr. Durbin as its most surprising yes vote, 11 of the 18 members of the president’s fiscal commission backed a blueprint to pare $4 trillion from projected deficits in the first decade. It would cut domestic and military spending; curb Medicare and Medicaid; and overhaul the tax code, limiting or repealing tax breaks and using the new revenues to lower tax rates and reduce deficits. Separate from its debt-reduction plan, the panel proposed benefit and payroll tax changes to stabilize Social Security for 75 years.
Immediately, Mr. Chambliss and Mr. Warner enlisted four senators from the commission majority to negotiate writing the recommendations into legislation. Besides Mr. Durbin, the others were Senator Kent Conrad, a North Dakota Democrat who leads the Budget Committee, and Senators Tom Coburn of Oklahoma and Michael D. Crapo of Idaho, both Republicans.
“As I said to a Republican recently,” Mr. Durbin said in an interview, “it’s like we’re on a long flight here and we’ve come so far there’s no turning back — we’ve got to land the plane.”
The effort holds peril regardless of the outcome. If successful, a plan could be taken up as Congress debates this spring over raising the nation’s $14.2 trillion debt limit. But the group is hardly assured of support from Senate colleagues, let alone lawmakers in the House, where Republicans, including dozens of new Tea Party supporters, refuse to consider raising revenues. If the group fails, that would probably signal doom for the broader bipartisan effort Mr. Obama wants.
Mr. Durbin, the liberal Democrat, and Mr. Chambliss, the conservative Republican, may have the most at stake. Mr. Durbin could be isolated in the Senate leadership, and Mr. Chambliss potentially vulnerable given Republicans’ penchant for ousting incumbents who deviate from the antitax line. Neither senator faces re-election until 2014.
An administration official recalled that in early 2010, when Mr. Durbin was named to Mr. Obama’s fiscal commission, another White House official told its co-chairmen, “You’ll never get Durbin’s vote.”
Nine months later, Mr. Durbin announced his support in The Chicago Tribune for the recommendations the chairmen had negotiated with members. “The question my closest political friends are asking is this: Why is a progressive like Dick Durbin voting for this deficit commission report?” he wrote. The answer: “Borrowing 40 cents out of every dollar we spend for missiles or food stamps is unsustainable.”
So, Mr. Durbin added, “when we engage in the critical decisions about our nation’s future budgets, I want progressive voices at the table to argue that we must protect the most vulnerable in our society and demand fairness in budget cuts.”
That has been his mantra with disappointed allies in labor, women’s groups and the Senate. Mr. Durbin, in the interview, cited a private meeting requested by Senator Bernie Sanders, independent of Vermont, a socialist and “a good friend.” Their exchange, Mr. Durbin said, captured the increasing difficulty in being a good progressive “at a time of limited resources.”
Mr. Sanders said he respected Mr. Durbin for his good intentions. “But I think the direction in which he is going in working with some of the most very conservative members of the Senate is not correct,” Mr. Sanders said.
Critics suggest that Mr. Durbin is seeking a new role to counter the prominence of Senator Charles E. Schumer of New York, his roommate and his rival in the Senate leadership.
But Andy Stern, a former labor leader who was on the fiscal commission and opposed its report, defended Mr. Durbin, saying, “It’s classic Washington that we can’t imagine that someone does something because they think it’s the right thing to do.”
That is Mr. Chambliss’s claim as well. “I hear my critics; I pay attention to my constituents,” he said in an interview. “But you’ve got to do the right thing and what’s best for the country.”
And Mr. Chambliss has been increasingly outspoken in arguing that additional revenues must be part of a debt-reduction plan, given the scale of the problem.
“I’m taking arrows from some on the far right,” he told the Rotary Club of Atlanta in an appearance with Mr. Warner on Monday. “Are some people going to pay more in taxes? You bet.”
A bolt came in February from Grover Norquist, a Republican antitax activist, who wrote to Mr. Chambliss, Mr. Coburn and Mr. Crapo to say they would violate his group’s “Taxpayer Protection Pledge” if they supported raising revenues for deficit reduction.
The trio countered the same day, releasing a letter telling Mr. Norquist that their effort broke no pledge “but rather affirms the oath we have taken to support and defend the Constitution of the United States against all enemies, foreign and domestic, of which our national debt may now be the greatest.”
Perhaps more troublesome for Mr. Chambliss have been critics at home like Erick Erickson, a conservative blogger, Atlanta radio talk-show host and CNN contributor. “Is Saxby Chambliss Becoming a Democrat?” Mr. Erickson asked in a recent blog post.
For many actual Democrats, Mr. Chambliss remains negatively defined by his 2002 defeat of Senator Max Cleland, a triple-amputee veteran of Vietnam, after a campaign that included an ad picturing Mr. Cleland with Osama bin Laden. Mr. Chambliss’s work on the Gang of Six has done as much as anything to soften attitudes.
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