No Dealing On The Debt Ceiling, Part 29

Time's starting to run out on the default clock, folks.  Recent moves this week by both Republicans and Democrats are giving rise to speculation that a deal is imminent.  BooMan for example sees Orange Julius folding like a lawn chair in a tornado.

Boehner will have to capitulate. It's his responsibility to pass something that the Senate Democrats will endorse and that the president will sign. That's his job. Unless he wants the U.S. to default on its debts, he has no choice. 

On the other hand, John Cole agrees with the notion that Boehner cannot back down without being replaced in the GOP leadership by the Tea Party fanatics.

The insane people are running the party, and now morons like David Brooks and the “reasonable Republicans” are like “WTF happened” when they were the ones fluffing the nutters for years. Even assuming there are Republicans left in the house that really are not insane enough to default the government, an assumption I am simply not willing to make, they are terrified they will lose their job like the other tens of millions of people suffering from Republican policies, because the teahadists will primary them.

I think both of them are missing the point, which is just how much the Dems have already surrendered to these nutbags.

Any deal that involves entitlements will have Republicans pounding the President and Democrats on the air screaming DEMOCRATS CUT YOUR MEDICARE AND SOCIAL SECURITY just like in 2010, and it is a battle the Democrats will lose and lose badly.  I'm not sure why Obama is bound and determined to do this, but there you are.

Why are we negotiating at all?  Katrina vanden Heuvel has the right idea.  Obama needs to pull out the 14th amendment card, and he needs to do it now.

Doing so will give him the leverage he lacks in the debt-ceiling negotiations. Right now, Republicans’ willingness to let the economy default, consequences be damned, gives them enormous leverage. But presumably, if a deal is not reached by the deadline, and the president is forced to exercise his constitutional obligation, Republicans will get nothing at all. Not the trillion dollars in cuts already agreed to. Not the additional trillion in cuts they are seeking. The threat, alone, of invoking the 14th Amendment defuses the bomb Republicans have strapped to the hostage.

I think the one thing that BooMan, John Cole, and myself can definitely agree on is the fact that the Republicans in 2011 are incapable of negotiating in good faith.  Since that's the case, pull out the trump card.  Obama's negotiations have gone well, and he's a shrewd guy when it comes to negotiations, but at this point we need to make it clear that we're all the hostages here, every one of us.

For months I convinced myself that Wall Street's bond market bigwigs and banksters wouldn't let the Republicans annihilate the markets with a default.  Now I'm convinced that the banksters are hedging side bets on another economic collapse and are more than happy to ignore the Republican suicide bombers.  Either way they make money, so why should they expend energy on pressuring the GOP one way or the other?

If the real choice now is either use the 14th amendment to go around the debt ceiling or default on America's debts (as increasingly it's looking like), I vote for the former.  The only way to win is to take the GOP out of the equation.

Unfortunately, it looks like the Dems may be the ones folding.

At a meeting with top House and Senate leaders set for Thursday morning, Obama plans to argue that a rare consensus has emerged about the size and scope of the nation’s budget problems and that policymakers should seize the moment to take dramatic action.

As part of his pitch, Obama is proposing significant reductions in Medicare spending and for the first time is offering to tackle the rising cost of Social Security, according to people in both parties with knowledge of the proposal. The move marks a major shift for the White House and could present a direct challenge to Democratic lawmakers who have vowed to protect health and retirement benefits from the assault on government spending.

“Obviously, there will be some Democrats who don’t believe we need to do entitlement reform. But there seems to be some hunger to do something of some significance,” said a Democratic official familiar with the administration’s thinking. “These moments come along at most once a decade. And it would be a real mistake if we let it pass us by.”

Rather than roughly $2 trillion in savings, the White House is now seeking a plan that would slash more than $4 trillion from annual budget deficits over the next decade, stabilize borrowing, and defuse the biggest budgetary time bombs that are set to explode as the cost of health care rises and the nation’s population ages.

That would represent a major legislative achievement, but it would also put Obama and GOP leaders at odds with major factions of their own parties. While Democrats would be asked to cut social-safety-net programs, Republicans would be asked to raise taxes, perhaps by letting tax breaks for the nation’s wealthiest households expire on schedule at the end of next year.

The administration argues that lawmakers would also get an important victory to sell to voters in 2012. “The fiscal good has to outweigh the pain,” said a Democratic official familiar with the discussions.

Which pretty much assures that anyone voting for this plan will draw the wrath of primary challenges and hatred.  I understand the whole "If everyone hates the plan then it must be good politics" thing, but...$4 trillion in cuts and we're counting on the GOP not to scuttle the deal?

Good luck getting this through Congress.

[UPDATE]  And the GOP has already moved the goalposts, now demanding that the debt ceiling be lowered and that a balanced budget amendment is added to the Constitution.