Trying to make sense of the McConnell debt-ceiling plan

Sly as a fox or sneaky as a weasel? Senate Minority Leader Mitch McConnell has offered a contingency plan for a debt-ceiling increase that is being viewed both warily and cheerfully on the right — and with shock, but early seeming delight, in some precincts of the left.

Let’s try to figure out what’s going on.

Rich Lowry at National Review Online seems to have the most details about what the McConnell plan would entail. It is a backward legislation process by which the president gets what he wants, even if neither chamber can muster a majority vote in favor of what the president wants, unless a super-majority (two-thirds) of both chambers votes to override the president’s veto of the disapproval of his plan. And this process would play out three times during the next 12 months, with the president making three separate requests in the amounts of $700 billion, $900 billion and $900 billion.

Confused yet?

The plan is being called an automatic debt-ceiling increase for President Obama, which isn’t technically true — but it is true for all intents and purposes, because veto overrides are fairly rare things.

There are two apparent catches where Obama is concerned. First, he can only get a $100 million increase before Congress votes. And those votes require him to submit a plan for cutting spending — there’s no mention of raising taxes — by an amount equal to each total request. That means a total of $2.5 trillion in cuts if he’s to get all three requests.

Second, by giving the impression that a debt-ceiling increase is there for Obama’s taking if further negotiations break down, McConnell is trying to kill the arguments that congressional Republicans are blocking a deal and risking a (technical) default of the federal government.

Yet, at first glance, I have strong reservations about each point.

On the first point: There is nothing in the McConnell plan, as far as I can tell right now, to allow Congress to direct where the spending cuts go (other than the potential, but highly unlikely, veto override). As far as I can tell, Obama could simply say he’s going to cut the defense budget by $2.5 trillion over the next 10 years — which Republicans and, I suspect, even a lot of Democrats would find objectionable — and Congress would be virtually powerless to stop him. (To my friends on the left: Try to keep in mind that in future years, this arrangement could set a precedent for cutting Obamacare, Medicaid, welfare, etc. in the same way.)

Worse, there does not appear to be much of an enforcement mechanism for making sure the cuts actually happen. Congress would have to incorporate them in future appropriations bills. But what if, for instance, Senate Democrats filibustered those appropriations bills until the cuts were removed. Or, worse, what if Obama went back on his word and vetoed the appropriations bills, negating the cuts he promised to make? Those scenarios may or may not be likely, but in this kind of situation I think it’s worth examining such possibilities.

And still worse, this arrangement would seem to have the same problem that congressional Republicans have complained about regarding the cuts Obama already has proposed: That they’re back-loaded in a way that keeps deficits large now and makes future cuts less likely to actually be made.

In other words, this does not seem likely to produce good fiscal policy.

Now, on the second point: This may or may not be good politics — it’s not obviously good politics, imo — but it strikes me as too clever by half and too cynical by full. I think it could easily be seen, and rightly so, as an abdication of duty.

Let the House pass a debt-ceiling measure, and let McConnell attempt to bring it to the Senate floor. Or, let them say that they’ll approve a debt-ceiling increase if the Senate will approve and Obama will sign the Ryan budget plan for 2012. And if Senate Democrats won’t take up either measure and won’t propose an alternative, we’ll know who stood in the way.

The GOP doesn’t need to resort to this kind of gimmickry. Or can someone convince me that this is actually a good idea?

– By Kyle Wingfield

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185 comments Add your comment

GTT

July 12th, 2011
4:14 pm

Nope. Sure can’t, because it’s not.

Ken

July 12th, 2011
4:22 pm

I’m all for cutting 2.5 trillion in defense, and we’ll still outspend the rest of the planet.

Bill

July 12th, 2011
4:34 pm

The Republican leadership clearly fears it has lost control over too many of its insane Tea Party members. I can hardly believe this plainly idiotic, bad-faith proposal.

Blue Man on a Red Island

July 12th, 2011
4:35 pm

The Republicans only have themselves, and Grover Norquist, to blame for this one. Obama out flanked them with the $4T offer and the Republicans have been in retreat since that moment.

McConnell and the others are seeing what many of you refuse to. The majority of Americans want a balanced approach to this. 80/20 spending versus revenue was a major win for them but that little pledge to Grover made it impossible to say yes to the best deal they were going to get. Now they are stuck trying to defend huge cuts to programs that benefit a huge number of Americans while trying to convince us all that the top 2% should make no sacrifice. That’s a losing argument and they know it.

Spin it all you want but McConnell’s plan is a surrender and a big win for the Democrats.

WIDTAP

July 12th, 2011
4:35 pm

It’s worse than you think.

When the Congress votes to disapprove, and the President vetos the disapproval, the proposed budget cuts get blocked, but the debt limit still increases. Then Republicans go into 2012 talking about how the President increased the debt-limit without doing anything about the cutting spending or raising revenue.

The Constitution puts the power of the purse in Congresses hands. Congress needs to take upfront responsibility for the budget rather than asking any President to make cover for them.

that's goofy

July 12th, 2011
4:46 pm

I agree w/ Bill.

The GOP has left themselves with no room to negotiate. The all or nothing approach is stupid. The President is willing to cut spending – but he wants to close loopholes.

Stephenson Billings

July 12th, 2011
4:52 pm

I say don’t do anything. I mean, when we meet the “ceiling” it’s not as if the gov’t will stop servicing its loans. They’ll still get serviced first and the rest of the gov’t will have to make due with what’s left… shazam! automatic spending cuts.

CJ

July 12th, 2011
4:54 pm

I agree with Kyle that the McConnell proposal is gimmickry. But refusing to raise the debt ceiling unless the Democratic Senate and the Democratic President succumb to Republican demands is extortion.

Stephenson Billings

July 12th, 2011
4:59 pm

Why raise taxes?

“Federal tax revenues have exceeded federal interest payments on the national debt by more than 10-fold during the presidency of Barack Obama, according to the daily accounting statements published by the U.S. Treasury Department.

There is no way the U.S. government would need to default on its interest payments on the federal debt if the debt limit were not increased and the government allowed to borrow more money than it already has.

Also, with the current revenue stream, the federal government can afford to pay entitlement and veterans benefits and wages and insurance payments for federal workers–without having to borrow new money.

[snip]

In fact, since Obama has been president, after the government paid the interest on the debt, plus Medicare, Medicaid, Social Security, Veterans Affairs, and federal workers’ salaries and insurance, it still had $491.826 billion in tax revenue left to spend on discretionary items.”

ByteMe

July 12th, 2011
5:05 pm

I think it could easily be seen, and rightly so, as an abdication of duty.

It is. Congress is responsible for spending and taxation, not the President. How could this possibly be Constitutional?

It does seem like he’s trying to be too clever and he’s created a plan only Democrats could love with its complexity. It won’t fly. The Tea Partiers in his own party will likely slap it around because it takes fiscal policy out of their hands.

Kyle Wingfield

July 12th, 2011
5:11 pm

CJ: And Democrats’ refusal to raise the debt ceiling unless the Republican House succumbs to their demands is just pattycake?

CJ

July 12th, 2011
5:26 pm

Kyle,

Will the Democratic Senate pass a clean debt-ceiling bill? Yes. Will President Obama sign a clean debt-ceiling bill, which he originally requested? Yes.

The Dems are saying that if you have demands, then we have some requests of our own. That’s not unusual in a hostage negotiation:

At the beginning of a hostage crisis, the hostage-takers’ demands are often unreasonable. Of course, the negotiator can’t just give them anything they ask for, even if it would mean safety for the hostages…Plus, if anyone who took hostages immediately had all of his or her demands granted, the world would face one hostage crisis after another.

However, the negotiator can ‘chip away’ at the situation by offering minor concessions…In return, the hostage-takers can trade some of the hostages or some of their weapons or agree to downgrade some of their demands. By continuing this process, the negotiator can gradually weaken the hostage-takers’ position.

http://people.howstuffworks.com/hostage-negotiation5.htm

I Report (-: You Whine )-: Thee Magnificent!!! mmm, mmmm, mmmmm! Just sayin...

July 12th, 2011
5:27 pm

Would anyone like to bet that Nasty Pelosi doesn’t understand this one either?

Blue Man on a Red Island

July 12th, 2011
5:28 pm

@Kyle – Democrats proposed a clean bill to raise the debt ceiling as ha been done time and time again. Republicans had that option but chose to, for the first time, tie it to other matters. Republicans started the demand game, trying to blame that on Democrats now that your side is caving is pure partisan rhetoric.

jconservative

July 12th, 2011
5:28 pm

Kyle, the title of the column, “Trying to make sense of the McConnell debt-ceiling plan” is really a creative title.

But this is not a debt-ceiling plan. This is just another tactic in the 2012 presidential election.

But it is still humorous.

And the White House wanting to cut $4 trillion and the Republican leadership saying that is too much. That in itself is the laugh of the year to date.

And now Obama is saying no debt ceiling increase and no Social Security checks on August 3.

Will Obama just say that no debt ceiling increase and no August paychecks for all 537 elected officials? That would be a “laugh out loud”.

This would get done quicker and smoother if their was a clear cut Republican presidential front runner who could call the shots for the House. But alas.

Blue Man on a Red Island

July 12th, 2011
5:29 pm

CJ – You said it much better than I did. My refresh button is too slow.

ByteMe

July 12th, 2011
5:29 pm

CJ: excellent response.

Kyle Wingfield

July 12th, 2011
5:33 pm

CJ: Then why hasn’t Harry Reid brought up a clean debt ceiling bill? As far as I’m aware, only the House has held a vote on such a bill. Is Reid concerned that holding such a vote — and watching it fail — would prove that Republicans aren’t the only “radicals” here?

But nice hostage-takers reference. Glad to know the New Civility is still alive and well.

Kyle Wingfield

July 12th, 2011
5:35 pm

My guess is that Reid’s problem isn’t just that he doesn’t have any Republican votes, but that he doesn’t have all that many Democratic votes for a “clean” bill, either.

JDW

July 12th, 2011
5:37 pm

Well Kyle, first off a 4 to 1 ratio of spending cuts to revenue increases isn’t just “pattycake”! In any fair negotiation I have ever seen that is a HUGE win. Want to ‘splain why the Repugs don’t take the win?

Second off I find myself continuing to ask how the heck we got from 2001 to here…

As President Bill Clinton was leaving office. The Congressional Budget Office estimated then that the government would run an average annual surplus of more than $800 billion a year from 2009 to 2012. Today, the government is expected to run a $1.2 trillion annual deficit in those years.

According NY Times research…

You can think of that roughly $2 trillion swing as coming from four broad categories: the business cycle, President George W. Bush’s policies, policies from the Bush years that are scheduled to expire but that Mr. Obama has chosen to extend, and new policies proposed by Mr. Obama.

The Business Cycle(IMO a direct result of Duhbya)-37% at fault

President George W. Bush’s policies 33% at fault…. That legislation, like his tax cuts and the Medicare prescription drug benefit, not only continue to cost the government but have also increased interest payments on the national debt.

Bush policies Mr. Obama has chosen to extend (at great cost to us and himself)-20 %…for example Iraq, tax cuts for wealthy, bailouts signed by Bush etc…

Lastly we have new policies proposed by Mr. Obama – 10%….THATS RIGHT 10%….About 7 percent comes from the stimulus bill that Mr. Obama signed in February. And only 3 percent comes from Mr. Obama’s agenda on health care, education, energy and other areas.

So maybe you could explain how it is that we find ourselves in a situation created primarily by Republicans that they now want to lay off on someone else and refuse to be party to a fair and balanced solution?

http://www.nytimes.com/2009/06/10/business/economy/10leonhardt.html

Michael H. Smith

July 12th, 2011
5:38 pm

Yeah, right! :roll:

Blue Man on a Red Island

July 12th, 2011
5:40 pm

@ Kyle: What’s the point of the Senate bringing up that bill knowing the House wouldn’t vote for it?

Your getting into Bachmann territory with your revisionist history as to where the correlation between increasing the debt ceiling and deficit reduction came from.

Jefferson

July 12th, 2011
5:40 pm

Politicians don’t like simple. Why not just have a bill to raise the debt ceiling as the only item on the bill and vote on it. If you raise it, the gov’t doesn’t default if you don’t the gov’t defaults. What could be simpler? Then you know who voted to default.

Gordon

July 12th, 2011
5:42 pm

Both sides understand the need to raise the debt ceiling, and both sides understand the need for spending cuts. A clean bill would be one that does both and nothing else, and that is what the Republicans back. It is the Democrats who are introducing something else into the mix: revenue increases. Even Obama, who has proposed 5 times the spending cuts as revenue increases, understands the bulk of this will have to be done with spending cuts. And it was he who said 6 months ago that raising taxes now, even on the wealthy (those “millionaires and billionaires” who create jobs), was not a good idea at this time of nearly 10% unemployment.

Kyle Wingfield

July 12th, 2011
5:42 pm

JDW: I’ll believe this 4:1 business is serious when a) the spending to be cut is spelled out as explicitly as the tax increases, and b) the plan doesn’t front-load the tax increases and back-load the spending cuts.

We’ve seen this movie before: Tax increases now for spending cuts later…which never fully materialize.

Gordon

July 12th, 2011
5:43 pm

Jefferson,

Why even have a debt ceiling? What meaning does it have? There are people in this world who believe there should be limits on spending. Kind of a simple idea.

Kyle Wingfield

July 12th, 2011
5:45 pm

Blue Man @ 5:40: The House did just that with the 2012 Ryan budget. What was the point? Going on the record in favor of something rather than just pontificating. It was arguably the same when the Democratic-led House passed a cap and trade bill.

At some point, you have to be for something. Why aren’t Reid & Co. being branded the “Senate Majority of No”?

Jefferson

July 12th, 2011
5:48 pm

Gordon, the bills have to be paid. The debts are already created. They have been rung up for the last 10 years.

Why do people have mortgages, should they save their whole life to try to buy with cash?

Jefferson

July 12th, 2011
5:51 pm

But you are right, Gordon — it had no meaning for Presidents Reagan, Bush(s), and Clinton, but now it does ?

Michael H. Smith

July 12th, 2011
5:54 pm

What did dear ruler obumer once say about raising the debt ceiling… HMMM!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

C’mon “comrades” neither YOU DEMOCRATS or YOUR DEAR RULER can walk back his bold statement made as a Senator on raising the debt ceiling now. :lol:

ABC News ~

In March 2006, then-Sen. Barack Obama, D-Ill., found the notion of raising the debt ceiling quite distasteful.

“The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure,” he said. “It is a sign that the U.S. Government can’t pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government’s reckless fiscal policies. … Leadership means that ‘the buck stops here.’ Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt and a failure of leadership. Americans deserve better. I therefore intend to oppose the effort to increase America’s debt limit.”

He did. It passed narrowly – by a vote of 52-48.

http://blogs.abcnews.com/politicalpunch/2011/04/obama-2006-vs-obama-january-2011-vs-obama-april-2011-on-the-debt-ceiling.html

Who is the failed leadership now mr. obumer !?

Blue Man on a Red Island

July 12th, 2011
5:55 pm

@ Kyle: I would argue the benefits of holding a vote that you know has no chance of passing. The Republicans did it with not just the Ryan plan but also did so with the debt ceiling already and it got them exactly nowhere on both issues.

Harry Reid, as well as Obama, have been very clear that they would support a clean bill to raise the debt ceiling as both have stated it many times. If you aren’t clear where they stand on this issue my guess is you are in the vast minority.

CJ

July 12th, 2011
5:57 pm

I’m speculating, Kyle, but I suspect that part of the reason is that, to their disgrace, big media have handed the microphone over to Republicans and allowed them to make raising the debt ceiling politically unpopular–as if not raising it is somehow courageous rather than scandalous (the media is beginning to change its tune). Given the polls on this issue, I suspect that the Senate hasn’t wanted to vote to raise it with a clean bill unless a clean bill would pass the House too…which the House must also do before it can get to the President’s desk.

I agree with you that Reid should have held the vote and that Democrats should have voted raise the limit. Nobody is nominating Obama and the Dems for a “Profiles in Courage” award. In my opinion, they should have been explaining the consequences of not raising the debt ceiling to the American people instead of negotiation with Republicans. They’re on the case now, but it might be too little too late.

Michael H. Smith

July 12th, 2011
6:00 pm

Kyle Wingfield

July 12th, 2011
5:45 pm

Oh c’mon Kyle, you know it’s different when you’re talking about good socialists Big GUB’MENT Democrats. I mean, they don’t even need any budgets, do they?!

JDW

July 12th, 2011
6:03 pm

Kyle, if one party refuses to create the detail behind the framework how does it get spelled out? Boner tried and Norquist et al made him backtrack in less than 3 hours…as for tax increases now for spending cuts later WHEN have you seen this game before? The last tax increase in this country was under Clinton and it led to a balanced budget.

JDW

July 12th, 2011
6:07 pm

@ Gordon….”Why even have a debt ceiling?”

As many have speculated it may in fact be unconstitutional. Furthermore Debt Ceilings have NOTHING to do with increased spending…this issue is about paying the debts that CONGRESS HAS AUTHORIZED ALREADY. You want less spending…don’t authorize programs al la Medicare Part B that you don’t fund.

Michael H. Smith

July 12th, 2011
6:10 pm

Yeah and the LAST TAX increases did NOT take place during a down economy with an unemployment rate of 9.2%.

and obumer is no Bill Clinton

JDW

July 12th, 2011
6:11 pm

@MKS…

“C’mon “comrades” neither YOU DEMOCRATS or YOUR DEAR RULER can walk back his bold statement made as a Senator on raising the debt ceiling now.”

I would not expect him to backtrack. He was certainly right in 2006 and the same holds true today. The failed leadership of DUHBYA and the rest of the gang led us to that point and we are still cleaning up the mess!

JDW

July 12th, 2011
6:14 pm

“Yeah and the LAST TAX increases did NOT take place during a down economy with an unemployment rate of 9.2%.”

So? Seems to me the economy functioned just fine at that level of taxation and it is a damn sight easier to swallow than either default or spending cuts targeted at those that can least afford them

Michael H. Smith

July 12th, 2011
6:23 pm

Write this down somewhere for future reference (possibly a blog) Kyle on what happens after obumer and these whining “A” socialists get their “D” tax increase back a.k.a. “those old bush tax cuts”.

1) No real spending cuts will take place

2) Size and power of the federal government grows

3) Greater deficit spending occurs once those regained bush tax cuts have been spent in about, oh what say, 90 days?

Now the sensible readers should understand why we conservatives oppose giving into increasing taxes of any kind before FORCING cuts in spending, reductions in the power and size of the federal government. If we don’t it will be BIG GOVERNMENT BUSINESS WORSE THAN USUAL

Michael H. Smith

July 12th, 2011
6:33 pm

It seems “me”, as in YOU, missed something in reading that comment. Try this one more time: There was no economic down turn under Clinton as there is under obumer presently and unemployment wasn’t 9.2% under Clinton.

Clinton and obumer are nothing alike nor is economy of the ’90s anything like 2008 (actually 2006) to the present. That’s what isSO!.

John

July 12th, 2011
6:38 pm

Kyle, why should Harry Reid bring up a clean debt ceiling bill? The Republicans would only filibuster it like they always do. Republicans got themselves into this mess not they’re trying to squirm their way out of it. Look at what Boehner said today…it’s Obama’s problem.

Blue Man on a Red Island

July 12th, 2011
6:43 pm

@ Michael – Spare us. If you “conservatives” were truly worried about spending you would not have started two wars, passed a major tax cut and enacted a new entitlement program without funding any of it.

stranger in a strange land

July 12th, 2011
6:45 pm

The term ‘fubar’ would apply in this case?

Michael H. Smith

July 12th, 2011
6:50 pm

I’m sitting very firmly Kyle, how about you, are you squirming? :lol:

Hey the Dems are crying this full faith and credit non-sense.

All it would take is ONE… are you getting this liberals…. only ONE failed bond issue and the so-called full faith and credit of the United States of America wouldn’t be worth a lukewarm bucket of soured spit to anyone.

If this country does not address its debt NOW not years from NOW the debt ceiling really won’t matter one way or the other… just ONE failed bond issue is all it will take and we shall be as bad off if not worse off than Greece.

John

July 12th, 2011
6:52 pm

This has more to do with politics than raising the debt ceiling or the deficit. Eric Cantor said yesterday asking conservatives to raise the debt ceiling is a big deal…yet he himself voted to raise it several times…he did in 2002, 2003 and 2004. It was raised 7 times during the Bush administration. They didn’t have a problem with deficits while they controlled Congress and the White House. The Republicans got themselves in a bind…they voted to kill medicare as we know it in the Ryan Plan and found themselves the subject of a backlash at town hall meetings and recently lost a seat in a very Republican district. The leadership basically threw their members under the bus by forcing them all to go along with it…look what happened to Newt when he spoke against it. Knowing the Democrats can use this issue in the 2012 elections, they are basically trying to force Democrats to gut Medicare and remove the issue from the 2012 election cycle.

Michael H. Smith

July 12th, 2011
6:55 pm

Blue Man on a Red Island @ spare yourself and your ignorance of fact: Bush was not a conservative. :)

Oh and by the way has obumer and your Democrats stopped any wars lately?

Oh yeah, that’s right dear ruler went on the offensive in Libya without going to Congress didn’t he?

Huh! SPARE YOU LIBERALS, INDEED!

Lil' Barry Bailout

July 12th, 2011
6:55 pm

Blue Man on a Red Island: If you “conservatives” were truly worried about spending you would not have…passed a major tax cut…
——————

Tax revenues went up after our President Bush’s tax cuts were implemented.

Obozo promised during the 2008 campaign to end our President Bush’s tax cuts even before they expired. Then he changed his mind and agreed with our President Bush’s tax policy. Now he’s changed his mind again and wants to raise taxes. Your Idiot Messiah is like a squirrel in the middle of the road who can’t decide which way to scamper and is about to get flattened.

Don’t fear facts.

Lil' Barry Bailout

July 12th, 2011
6:56 pm

McConnell’s plan is too darn confusing.

Bring on the balanced budget, er, debt limit.

Lil' Barry Bailout

July 12th, 2011
6:59 pm

CJ: Will the Democratic Senate pass a clean debt-ceiling bill? Yes. Will President Obama sign a clean debt-ceiling bill, which he originally requested? Yes.
——————–

Of course they will, they can’t continue their reckless, un-American spending without a clean increase.

Not going to happen though–the adults have arrived to clean up your Idiot Messiah’s mess.

Blue Man on a Red Island

July 12th, 2011
7:06 pm

You guys have me confused as an Obama fan. I am a progressive (liberal, whatever makes you feel superior), and Obama is not. I do, however, side with the Democrats on this one. Conservatives helped run up the debt and they want to cut it on the backs of the less fortunate.

How’s that plan working out so far?