Obama's power grows as debt deadline approaches 

Despite recent optimism, there are still significant obstacles to overcome before Congress reaches an agreement to cut spending and raise the debt ceiling.  Like any other bill, both House and Senate have to pass precisely the same measure before it can be sent to the president, and that won't be easy.  In the House, some Democrats will undoubtedly oppose the bill from the left, and as far as Republicans are concerned, it seems likely that many more than the 22 GOP lawmakers who voted against the Boehner bill will oppose any new agreement that is acceptable to President Obama and Senate Majority Leader Harry Reid.

As the hours to Tuesday's deadline tick away, President Obama will have increasing leverage in his negotiations with Republicans.  The president has a nuclear weapon which he has not used thus far in the crisis but will certainly use if the issue remains unresolved in the next 24 hours.  That weapon is an address to the nation in which a sober-faced Obama reluctantly lays out what government spending will continue past the debt deadline and what spending will not continue.  Many insiders, both Republican and Democrat, believe Obama has been badly overexposed at times in the debt battle, but that would be a speech everyone watches.  The president would be the man dealing with disaster (even if it is one he helped create), while he dispatches aides and surrogates to blame it all on GOP radicalism.

When that moment comes, Republicans will not have as much leverage as some have thought, for one simple reason: GOP leaders believe default would be disastrous, and the White House knows that they believe default would be disastrous.  It is a fact: John Boehner and Mitch McConnell believe that not increasing the debt limit would lead, at the very least, to chaos.  They were prepared to press their case a long time, but not all the way to its conclusion, which is a partial government shutdown and an uncertain future.  To paraphrase former GOP Sen. Phil Gramm (quoted by the Wall Street Journal), they took a hostage they were not prepared to shoot.  "Republicans aren't prepared to stop a debt-limit increase," the Journal wrote July 13, "because the political costs are unbearable."

Republicans thought, correctly as it turns out, that they could leverage the debt ceiling issue to win significant spending cuts.  They knew they were on the right side of the spending question; big majorities of the public believe the government is spending too much money, and even the Obama administration's economic policymakers admit that current levels of deficit spending are unsustainable.  In the debt negotiations, Republicans made huge strides forward in keeping the debt issue focused on overspending and not on tax increases.  But there was always a limit to how far Boehner and McConnell were willing to press their case, and that limit is here.

That means that in the end both Republican leaders will likely be pressing their members to support a deal that many lawmakers find objectionable.  If the final deal includes roughly $1 trillion in spending cuts, GOP members will want to know: What and when?  They know how much trouble Republicans had trying to cut $100 billion in federal spending earlier this year.  (They settled for $30-something billion.)  Cutting $100 billion per year for the next decade would be much tougher, and Republicans will be rightly skeptical of any plan that pushes the biggest cuts into the later years of the decade, when they're less likely to happen. And of course, even if the deal would reliably cut $100 billion each year for the next ten years -- well, the deficit this year alone is $1.6 trillion.  Cutting $100 billion is progress, but not the sort of transformation that many conservatives hoped for.

Then there is the commission.  What will it cut?  And will any mandatory cuts included as triggers in the event the commission fails to act affect federal spending across-the-board, or will they focus on defense?  Whatever the case, if commission members truly attempt big spending cuts, the battle will focus on entitlements versus defense.  Republicans will be in for a long and very hard fight against Democratic attempts to gut the Pentagon budget.  Just look at the budget proposed this year by the Congressional Progressive Caucus, which called for huge tax increases and only one type of budget cut: defense spending.  The Progressive Caucus is far to the left ideologically, but is not a fringe group among House Democrats; with 75 members, it represents nearly half the House Democratic caucus.  They'll be pushing Democratic commission members hard for defense cuts.  Republicans will have to fight every step of the way to preserve acceptable levels of Pentagon spending while finding big cuts elsewhere.

So whatever deal Boehner and McConnell hammer out will face tough going among Republicans.  But in this endgame, the Speaker and the Minority Leader will be selling the plan with just hours to go before a deadline they strongly believe cannot be missed.  The pressure is on them. The White House knows that, and that knowledge increases the president's leverage in the coming hours.

About The Author

Byron York


Byron York is the Examiner’s chief political correspondent. His column appears Tuesdays and Fridays. He blogs throughout the week at Beltway Confidential.

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