“‘Reagan raised taxes,’ Simpson said. ‘We’ve never had less revenue to run this country since the Korean war.’
“Contrary to some Republicans expressing skepticism about the Aug. 2 default date, Simpson said that Treasury Secretary ‘Tim Geithner ain’t fooling.’”
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“[M]any Congressional Republicans seem to be spoiling for a fight, calculating that some level of turmoil caused by a federal default might be what it takes to give them the chance to right the nation’s fiscal ship…
“Representative Paul D. Ryan of Wisconsin, the Budget Committee chairman seen as the voice of fiscal authority among House Republicans, said that he believed an agreement leading to a debt limit increase would eventually be reached, but that the impasse could extend beyond the administration’s Aug. 2 drop-dead date.
“‘Let’s say we go past Aug. 2,’ he said in an interview. ‘As time goes on, the situation deteriorates, so I do believe there will be something.’ He pointed to ‘macroeconomic circumstances and credit markets — and also paying the bills — Social Security, Medicare, the troops.’
“‘I think there ultimately will be something,’ he said. ‘I really honestly don’t know what it’s going to be. I really don’t.’”
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The hotter precincts of the blogosphere were calling [McConnell's proposal] a sellout yesterday, though they might want to think before they shout. The debt ceiling is going to be increased one way or another, and the only question has been what if anything Republicans could get in return. If Mr. Obama insists on a tax increase, and Republicans won’t vote for one, then what’s the alternative to Mr. McConnell’s maneuver?…
“The tea party/talk-radio expectations for what Republicans can accomplish over the debt-limit showdown have always been unrealistic. As former Senator Phil Gramm once told us, never take a hostage you’re not prepared to shoot. Republicans aren’t prepared to stop a debt-limit increase because the political costs are unbearable. Republicans might have played this game better, but the truth is that Mr. Obama has more cards to play.
“The entitlement state can’t be reformed by one house of Congress in one year against a determined President and Senate held by the other party. It requires more than one election. The Obama Democrats have staged a spending blowout to 24% of GDP and rising, and now they want to find a way to finance it to make it permanent. Those are the real stakes of 2012.
“Even if Mr. Obama gets his debt-limit increase without any spending cuts, he will pay a price for the privilege. He’ll have reinforced his well-earned reputation as a spender with no modern peer. He’ll own the record deficits and fast-rising debt. And he’ll own the U.S. credit-rating downgrade to AA if Standard & Poor’s so decides.”
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“Most people don’t care about the deficit, much less the debt ceiling. They care about jobs and the economy–which is the real advantage Republicans have in the coming campaign.
“If McConnell actually proposes to pull an Emily Littella and say ‘Never mind’ about the debt ceiling, the President can pocket this inadvertent gesture of sanity, sign the debt ceiling extension…and then come right back with an economic package reducing the deficit $2.4 trillion over the next ten years, including the budget cuts that both sides have agreed upon plus the loophole closing revenue raisers–corporate jets, oil and ethanol subsidies, and hedge fund manager tax breaks–that 80% of the American people favor. Let the Republicans vote that one down, or refuse to consider it at all in the House of Representatives. Barack Obama would have a lovely issue to run on.
“But I don’t believe for a moment that McConnell is going to do this. He’s desperate, facing a deal that either includes revenue increases or doesn’t happen at all. He’s blinking as fast as he can.”
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“There is no constitutional authority for the legislative branch to surrender its clearly delineated duty to write bills for raising revenue and borrow money on the credit of the United States.
“Treasury Secretary Tim Geithner recently employed a clever but easily falsifiable argument, which cites Section 4 of the 14th Amendment to claim that the president can override the separation of powers…
“McConnell’s enthusiasm for this unconstitutional gimmick is disheartening, but it does not change the law. Congress has no more right to give up its authority than the president has to confiscate it.”
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“Despite intense lobbying of Congress by President Obama, Treasury Secretary Timothy Geithner, and others in the administration about the economic urgency for raising the nation’s debt limit, fewer than one in four Americans favor the general idea of raising it. Also, Americans are significantly more concerned about the budgetary risk of giving the government a new license to spend than they are about the potential economic consequences that would result from not raising the debt limit. Both of these findings put Americans more on congressional Republicans’ side of the debate than Obama’s — at least in terms of political leverage as thsides negotiate a deal.”
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