Closing the Deal?

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The debt ceiling debate is ramping up in both intensity and rumor-mongering. Yesterday, with less than two weeks remaining before the August 2nd deadline, The New York Times reported that President Obama and House Speaker John Boehner “were starting to close in on a major budget deal” which would include a combination of spending cuts and revenue increases engendered by an overhaul in the tax code. Shortly afterward, Fox News reported that both Boehner and the White House “emphatically denied” the Times story. White House Press Secretary Jay Carney concurred with Fox. “There is no deal. We are not close to a deal,” he told reporters. Yet efforts on various fronts are apparently moving forward, albeit somewhat clandestine. And amidst such abounding speculation, rumor must be separated from reality.

In the Senate, Majority Leader Harry Reid (D-NV) announced that he had scheduled a cloture vote on the only bill passed in the House so far, the Cut, Cap and Balance Act. That vote will take place Saturday morning. A cloture vote allows the Senate to place a time limit on the consideration of a bill. If an additional 30 hours of debate are requested, it must be approved by 60 members. Yet that possibility, as well as the chances of the bill itself passing in the Democratically-controlled Senate, are virtually nil. Much of that hopelessness was buttressed by the intensity of outrage the bill elicited from Democrats.

“What a sham! What a scam,” said Senator Mikulski (D-MD). “I’d be tempted to just blow it off if it were not so cruel, stupid and dangerous.” Tom Harkin (D-IA) ridiculed the name of the bill itself. “The cut isn’t just a nick; the cut is more like an amputation: cutting the legs out from underneath the federal government,” Harkin said. “And the cap, is it just a small cap? I prefer to call it a decapitation: taking the head off the federal government’s resources and the power to respond to the needs of our country.” Chuck Schumer (D-NY) called it a “DOA plan to cap, cut and kill Medicare.”

Yet Reid remained firm. “I am committed to allowing a full and fair debate on this bill. I want the proponents and opponents of this bill to have time to air their views,” he said, even as he expressed the hope the vote would happen sooner than Saturday.

The Cut, Cap and Balance Act would “cut” $111 billion in federal spending for FY 2012, along with providing a fixed “cap” on government spending relative to the Gross National Product over the course of a decade. It would begin at 22.5 percent of GDP in 2012, with decreases in spending levels reaching 19.9 percent of GDP in 2021. As for the “balance” part, the bill would require the passage of a Balanced Budget Amendment before raising the nation’s debt limit.

Seemingly, only the cut and cap provisions are doable prior to August 2nd. But a Balanced Budget Amendment requiring approval by a two-thirds vote in Congress and three-fourths of the states’ legislatures? August 2, 2012 would be a long shot. How do Republicans reconcile this? Legislative director Mike Jermain explained that if CC&B were passed, followed by the approval of two-thirds of each chamber of Congress required for a constitutional amendment, spending could be capped while awaiting the three-fourths approval of state legislatures necessary to pass such an amendment.

Meanwhile the other plan, commonly known as the “Gang of Six” proposal that originated in the Senate, reached the House. It was met with the same level of “enthusiasm” from House Republicans as CC&B received from Senate Democrats. The Gang of Six also elicited equal amounts of criticism. “In case Senator Reid didn’t notice, a bipartisan ‘Gang of 234’ just sent him the way forward. It’s called the Cut, Cap, and Balance Act,” said Jim Jordan, chairman of the House Republican Study Committee. “The plan fails to significantly address the largest drivers of America’s debt, and it is unclear how the goals of tax and entitlement reforms would be enforced,” said House Majority leader Eric Cantor. Paul Ryan, the Republican chairman of the House Budget Committee, dismissed it as a “backroom bill.”

But it gets even more curious regarding the Gang of Six efforts. As reported by several news sources earlier this week, this seemingly dead-in-the-water proposal was resuscitated by the return of Tom Coburn (R-OK) who “unexpectedly” rejoined the bipartisan group on Wednesday. That raised the hope, expressed by Senate Budget Committee Chairman Kent Conrad, that this package of debt reductions and tax increases would be “married” to the debt ceiling talks.

Twenty-four hours later, the marriage was off. Coburn announced that Cut, Cap and Balance stood the best chance of keeping the country from defaulting. “It’s the only bill that has passed the House,” Coburn contended. “It has a chance of meeting the August 2nd deadline. There are other ideas out there. The gang of six wasn’t intended to be tied to the debt limit. There’s no way it can be tied to the debt limit before August 2nd. This is our opportunity.”

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  • Cuban Refugee

    Although I am not an economist, and balancing the checkbook can be an occasional challenge, I am positive of this: Americans are up the proverbial "sh&@'s" creek without a barrel. For too long, we did not watch the store's cash register, and our corrupt employees decided to take over the business. They stole our money with impunity, extended credit that was never repaid, doled out our future security to their cronies and to lazy ne'er-do-wells, and spent the rest on frivolous projects. The worst offense was that they sold our formerly successful enterprise to a nefarious consortium of radicals who wish to open our doors wide. If only we had installed hidden cameras to catch them in the act — if only we had been more vigilant …

    • WilliamJamesWard

      It seems you are correct and who can we pin the robbery on, it is the Congress
      no matter what buffoon occupies the White House, the Presidency is merely
      a distraction to take away what the ensconced crooks are about. Government
      in America has become a vast criminal enterprise that works the citizenry
      like playing a fiddle. It seems it is Washington D. C. or America, we desperately
      need to change every person in government, elected, appointed or hired in order
      to save the victim which happens to be us.

      Sick to death in America……………….William

      • Cuban Refugee

        After reading your reply, William, I reread my post and had to laugh even in the face of the disaster that surrounds us. Just before I read this piece yesterday, I viewed a picture slide show of my little niece's birthday party; it was accompanied by a repetitive ditty:
        Oh, playmate, come out and play with me
        And bring your dollies three.
        Climb up my apple tree,
        Look down my rain BARREL
        Slide down my cellar door
        And we'll be jolly friends forever more.
        This tune must have been at the forefront of my mind when I converted paddle into barrel. The prospect of living under communism again has me singing nursing rhymes … and interspersing their lyrics in my comments.
        You sign off "Sick to death in America," and I say we must never allow them to kill our spirits. We must continue to be healthy, resplendent lights of the world no matter how much darkness is imposed.

        • WilliamJamesWard

          Back in the late "50's my family had new neighbors named Rufo, the
          father was in the Trujillo government as finance minister. I believe he
          went to work as and accountant. As I remember my late brother had
          a crush on the daughter and was pals with the son and I remember
          his name was George, so I assume as and only son the father would
          be a George also, George Rufo, maybe Ruffo? They were very glad
          to escape with their lives……………..Regards, William

  • MBA NJ

    as a former CFO I was always aware of the competing interests in an organization and one steward without a conscience could easily corrupt all values and the very survival of the organization, as we now see. I cannot impose values on folks who are focused on themselves and getting re-elected at all costs. I will always have a smile and a frown when I hear that this is the best system…that money can buy…..ouch….

  • StephenD

    All I know right now is there is NO DEMOCRATIC PLAN. I would like everyone to see the facts and for them to broadcast the negotiations. You know, like we were PROMISED BY THE PRESIDENT (transparency).
    Telling us the sky is falling and offering no solution except asking for more money doesn't cut it. Time for them to Put Up or Shut Up.

  • Supreme_Galooty

    Leonard Read once told the story of how he was being set upon by a band of ruffians in his front yard who were methodically beating the daylights out of him. A group of his friends and neighbors gathered, and watching the beating taking place they debated their course of action, if any. They decided they should intervene on his behalf, but some of them argued that they should only peel the ruffians off one by one – gradually – lest Read jump up immediately and go back to work. Others argued that they should just get the job done and send the ruffians packing.

    This so-called "Cut, Cap, and Balancing Act" is representative of those who would peel the ruffians off gradually so as not to shock the poor beleaguered economy. As for poor Mr. Read, I believe his neighbors are still debating. Should he survive the ruffians, one would hope he finds new friends and neighbors. With friends like those, who needs enemies?

  • LindaRivera

    An inferior health care plan that no one wants and CANNOT afford to pay. The threat to jail and/or fine those who don't purchase the government enforced plan.

    Massive spending as if there is no tomorrow. Fighting wars we have no money for. Massive borrowing. The Massive giving away of Billions of dollars every year to other countries, including the oil-wealthy Middle East, Hamas-controlled Gaza and the Palestinian Authority organization who fill their war chests, build mansions and laugh all the way to the bank with free infidel money. Whilst in America, homeless shelters are filled to capacity; tent cities have sprung up all over the U.S. filled with desperate, jobless, homeless, NEGLECTED Americans.

    Massive debt. The massive printing of paper money out of thin air to DELIBERATELY create out of control inflation. There is no question that the total DESTRUCTION of America's economy is planned. The results will be horrifying. In the once wealthy and great nation of America, millions of Americans will become destitute, hungry and homeless with no money or resources to help them.

    • WilliamJamesWard

      You are so right Linda. I have said and will continue to say that the beast that is
      choking the life out of us has two hands around our throats one is Democratic
      and the other Republican. It seems they take turns taking us for what they can
      like herd cattle, culling and shearing, now they are going for all of the meat.

  • Supreme_Galooty

    P.S. The point is that all spending must originate in the House of Representatives. No actions, no compromise, no debate is necessary. The Senate need not even be considered. The President need not even be considered. The House merely needs to make the cuts it desires, then sit back and do nothing but watch the caterwauling.

    • Rifleman

      That's my take, and if the GOP doesn't stand their ground now, they likely never will.

  • LindaRivera

    Organic, non-gmo avocado, fruit and nut trees and berries must be planted in all of our nation’s cities’ and towns’ parks to help the many millions of Americans who will soon be in a desperate struggle to survive.

    Watch it. And weep for our great nation and people:

    FALL Of The Republic – The Presidency Of Barack H Obama – The Full Movie HQ

    • StephenD

      Linda, I copied and spent the time to watch the entire video. Apart from serious reservations I have on Mr. Jones and Governor Jesse Ventura (more recently associated with the T.V. Show “Conspiracy Theory,” it was very informative. I would like substantiation for the claims. Mr. Jones drops some bombs without any proof of a connection which just doesn't set well with me. For example, he mentions Al-Qa'ida being supported by the US before 9/11…with no supportive commentary or written statements, etc. He just mentions it and it hangs there. We are forced to either take him at his word or drop his entire piece. I trust he did his homework but I believe in the old adage to "Trust, but verify." Regardless, there is plenty in there which is VERY informative and I’d encourage others to view it as well. Thank you Linda for the link.

  • mrbean

    I am not worried at all. Ray Stevens is my financial advisor. Here is he did it.

  • bill

    do you realize we were forced to pay double for SS for decades so Libs could finance their "feel good" projects. Witness as truth of this — the government drew out 2.3 trillion dollars and replaced that with IOUs, and the fund is still solvent for awhile. They are scared to death they have to pay it back so they'll cut your benefits, increase your age and in general F… You over NICE Government

  • LindaRivera

    Obama promised hope and change. All hope is destroyed and the change appears quite terrifying.

    Obama Creates Army Hidden In Health Care Bill

  • Asher

    The Speaker and the House came up with a plan, and implemented it, They Delivered and worked for the people, the Democrats own the economy and the Hatred of the American People.

  • Reason_For_Life

    The "draconian" cuts are not cuts at all.

    The average budget increase from 2000 to 2010 is 7.2%. This means that the 2012 budget would most likely increase by about 14% over 2010 (the last complete year with real numbers) which would put it at about $3.94 trillion. The increase would average about $240 billion per year. So the supposedly murderous cut of $117 billion is actually an increase of at least $120 billion or more than a 3% increase. Who but the feds would consider a 3% raise to be an attempt to starve you to death?

    • al222

      exactly right. glad to see someone gets it. bravo, reason.

    • WilliamJamesWard

      We are being played "as usual"…………………..William

  • coyote3

    Actually, I am glad the speaker "dee dee mau". I was beginnng to get worried about a "deal" that would sell out even worse than we have already been sold out.

  • Fred Dawes

    The deal is about one thing making this once great nation into some third world monkey house its not what you think its about the money and the deal is already been closed, "you are now only a tax Farm".. and you are about to be slaughter for the banking system, so have fun in the last days of freedom.

    • WilliamJamesWard

      Maybe some of us will say NO and others will begin to say NO to the government
      which is a criminal entity at best and anti-American with contempt for all of

  • Amused

    Here's a FACT , that neither partisans of either party , their ideologues and demagogues are remiss to acknowledge , and THAT to their own political peril .
    INDEPENDENTS and CENTRISTS have DETERMINED the last two Presidential election results .
    And make no mistake , they are fed up with the present brinkmanship both parties are playing with the economy , they are fed up with the partisan rhetoric, the dysfunctional Congress , and the contentious and poisonus political atmoshere, they have created in this country ,which , if you really think about it , is TRAITOROUS to any FREE , DEMOCRACY . When compromise is rejected out of hand in favor of unproven and questionable laws and practices . Pragmatism and CONSENSUS are non existent .These may seem correct in their respective "camps " or caucuses .But outsaide of their narrow political universes , the Independents and Centrists are DISGUSTED . And they will voice that in the 2012 election .

  • Amused

    Putting aside all the "birther " , marxist , rhetoric and ALL the associated baseless allegations , conspiracy theories , asperions and accusations , Obama the encumbent needs merely to show a willingness to compromise , whilst the Conservative/Republican /Teabagger position of NO compromise at any cost , will prove to be their undoing .Put a "Bachman up , and Obama easily wins ,. put a Romney up , and Obama wins , [he will be unnacceptable to the christiaqn right .] So republicans better get over their emotionalism , break the yoke of the teabaggers , and put up a nominee , who will be representative of ALL the people. Obama won the last elkection becuase the nominees the Republican party presented were simply unacceptable to Centrist and Independent , who do not participate in the rah, rah , partisan politics .With a country so divided , the middle will decide , and NONE there would find Palin , one heart beat away fromn the POTUS ,acceptable , though I'm sure all republicans did . …and McCain an obvious flip-flop artist ?

  • Amused

    Approval polls of the Rpublican Party have dropped from Favor -58% to 38% .The closer to the Debt Ceiling Aug.2 deadline we come , the further down those approval ratings will go . And the Republicans with their Teabagger intransigence , like it or not will be blamed .Should the deadline be exceeded , the President will no doubt sign an extension Should the USA 's AAA credit rating drop , there will indeed be another economic downturn , hurting MORE people , and again this will be blamed on the Republican party . Even Boener knows this , as TODAY , he is pressing for an agreement , not within weeks or days , but within HOURS . THE TEABAGGER INSTILLED DELUSION , THAT THEY ARE FOLLOWING THE "WILL OF THE PEOPLE " WILL FAST EVAPORATE .

  • Amused

    Diregard the warning from the ALL country's SANE economic experts ….at your own political peril .

  • Amused

    ….not to mention your countryu's own peril !

  • Dispozovdaburka

    Obama's new titles for his three upcoming books…
    Title # 1.

    Title for book # 2

    Title for book # 3

  • Amused

    Rhetoric is all you got .OHS is all you embrace . Answers/Solutions …you have NONE . When the goal of a party is totally geared to unseating it's opponent , that party had better have a plan …and so far there is none …nor is there a decnt or winable candidate any where in sight . Time to end all of this bac anfd forth theatrics .


  • Asher

    Obama wants the country to defaut, so he can blame the Republicans. Joe Wilson got it right when he said to Obama, "You Lie."