Economics, Taxes and Spending

If Boehner Loses, GOP Loses the Debt Limit Fight

If the House passes the Boehner plan today, Senate Democrats will be in a bind. They cannot pass their own plan, offered by Senator Reid, thanks to a GOP filibuster—which means the Boehner bill will be the only live option for avoiding default. Senate Democrats will likely respond by trying to put forward a third option—a compromise between the Boehner and Reid plans. But considering the difficulty Boehner has had in convincing House conservatives to vote for his plan, he can credibly say that passing a watered down version of his plan in the House would be nearly impossible. Boehner’s message to Democrats, if his plan passes today, is simple: They can either pass his plan or let the country default. The choice is theirs. As Boehner told the GOP caucus, if his bill passes and the August 2 deadline approaches without a solution, Senate Democrats “will fold like a cheap suit.” So will President Obama.

But what happens if the House were to defeat the Boehner plan? With Boehner’s bill dead, the Senate would be back in the driver’s seat. Reid will then come up with some compromise version of his and Boehner’s plans that can win enough Republicans over to pass the Senate, which will then become the only viable legislation to prevent default. Instead of the Democrats capitulating, it will be a small number of Republicans in the Senate who “fold like a cheap suit.” The GOP filibuster will collapse, and Democrats will pass their watered down bill in the Senate with a handful of Republican votes. Then House Republicans will be in the very bind in which they intended to put Senate Democrats. They will have to decide: Do we allow the government to default, or pass the Senate bill?

In either case, they lose. If House Republicans pass the Senate bill, it will be a devastating political defeat for the GOP. The debt limit will be raised with little more than phantom spending cuts. Obama and the Democrats will have prevailed. If House Republicans reject the Senate bill, it will also be a devastating defeat for the GOP. Obama and Democrats will be able to blame Republicans for the resulting chaos. The GOP will take ownership of the weak economy. Obama will use the bully pulpit of the presidency to lay every bit of bad economic news—every weak jobs report, every interest rate increase—at the GOP’s feet. And Obama’s re-election prospects will be dramatically strengthened going into 2012—positioning him for a second term where he can continue to thwart GOP efforts to rein in government and continue his efforts to socialize the country.

All this can be avoided if the House passes the Boehner plan today—and Boehner insists that the Senate pass it, and the president sign it. If he holds firm, they will. This will be a modest victory for Republicans, but a major defeat for Obama. And we can then have this debate all over again in four to six months—which keeps spending cuts on the political front burner, and helps set up the next election as a referendum on the way forward for reducing our debt. Conservatives can win such a referendum. If they do, they will get the reinforcements they need on Capitol Hill to pass “Cut, Cap, and Balance”—and a conservative president who will sign it into law. If the Boehner plan fails today, all that may be at risk.

18 thoughts on “If Boehner Loses, GOP Loses the Debt Limit Fight

  1. What is the modest victory? Simply this: it’s Boehner’s plan. That is it, the full extent of it. It has Boehner’s name on it and he is a Republican, supposedly making the Democrats jealous. And that is the prize: they made the Democrats jealous. Spending reductions are illusory. The special commission will go in the box in the library of congress with all the other special commissions. The debt limit, meanwhile is real, instant and the only thing Obama wanted.
    It is amazing what fools you take us for. More amazing still how many of us are fools.

  2. If Boehner needs to pass a third option in the House, Why would he need the 26 or so hard line Republican conservatives when presumably the house Democrats (or a sizable majority of them) would pick up the slack? Voile, the tail no longer wags the dog.

  3. Once again, Republicans will steal defeat from the jaws of victory. This president is sinking fast but the Tea Party is about to throw him not only a lifeline, but are about to switch places with him in the maelstrom. Boehner’s bill is the final chance to give them cover vs. Obama and his 300 stenographers that pose as the WH press corps.

    But by all means, go ahead vote no, kill the Boehner bill. Then try to make your case to the American voters that your vote was reasonable and the right thing to do. Custer had a better chance at Little Bighorn.

    • It’s the Socialist RINO’s who will eventually give him his poverty pimp money to give to Union bosses and ACORN, the RINO’s will give us another 4 years of Sauron.

      • are you aware that ACORN has been shut down for quite a while? ya need to get that dead horse out of your driveway and move along

  4. Only the Republicans are threatening not to raise the debt limit if they don’t get their way in the budget negotiations. If this happens and the U.S. cannot pay all its bills and Social Security checks are not mailed, then the members of Congress should not receive their paychecks from the U.S. either.

    • Earth to Dan the Math Genius: the government will collect more than enough money to pay for its debt/interest obligations, Social Security and Medicare checks, and military salaries/retirements. It will not have enough money to pay for those things as well as all the additional spending which has climbed to 25% of our GDP over the past 2 years. If people don’t get their SS checks it’s because the Treasury chose to give the money to other spending programs, not because Republicans want to stop the insane and unaffordable spending. Nice try, though.

  5. Just in case anybody doesn’t understand this: The government’s interest payments for the next month, which must be paid in order to avoid default, amount to around $20 billion. The government is expected to take in around $170 billion in tax revenues in the same period. Not to mention Obama still has $160 billion left in blank check unspent stimulus funds. Not raising the debt limit DOES NOT EQUAL defaulting on the debt. The executive branch will have to make due with the money Congress allows it. Period. It will be up to Obama if we default or not. The fallacy that we will default if the debt limit is not raised is Democrat propaganda designed to scare people into raising the limit so they don’t have to cut spending.

    • how about the president take the money from the pentagon thats earmarked for obsolete and redundant weapons systems… want a catalog ?

  6. You Keynesian RINO’s are going the way of the Whigs! People are just as tired as Socialist Democrat spending as they are of yours!

  7. Ha! The Teas wave their freak flags and block Boehner’s bill. I think you’re awfully optimistic about Republicans’ chances in the event of *any* default; the public sees how unwilling the Republicans are to compromise and will blame them no matter where the final bill dies. Republicans picked the wrong chokepoint to try to extort anti-middle class spending cuts. There are at least two more opportunities; no need to force it.

  8. With Republicans like you, who needs Democrats. You’ve been duped by the party leadership here, and I can’t fathom any reason for Boner to be pushing this ridiculous plan. To say that this inexplicable groundswell of support by the so called conservative media for passing Boner’s two tier plan is a disappointment is the understatement of this year.

  9. This post gets it exactly right. Boehner and the GOP need to put up a modest bill that under any other circumstances should pass and be signed by a Democrat Senate and President. If the Senate and President refuse this bill, then they will be the ones taking the blame for the default, and the GOP will live to fight another day.
    If the GOP passes a bill with tax increases or is seen as the cause of the default, then it will be destroyed–which has been Obama’s plan all along with this manufactured crisis. The GOP must survive this, and the only way is to pass a bill that seems to the public to be a reasonable compromise.

  10. Absolutely agree with Marc.
    Conservatives need to appreciate how far we have come already. A few months ago BO proposed a budget which actually increased our debt, and now we are debating a plan which cuts spending (OK, so not as much as we want, welcome to the real world) and without tax increases. How is this not a victory? All conservatives need to periodically place themselves outside of the comfortable womb of like-minded thinkers and see the big picture. The mainstream media is not with us and is itching to paint Republicans as being on the wrong side of this debt-ceiling debate. If they are successful this will have consequences for the ultimate goal of taking the White House in 2012, after which real reform might be feasible. Send the Boehner bill to a vote in the Senate so that there is no question in Joe Public’s mind as to which party is to blame.

  11. Mr. Thiessen

    Your comments are UnAmerican, trying to gain political advantage by hurting America. You have lost the battle and the War. Boehner’s plan is DOA in the Senate, as it should be, but Obama will not sign such, even if the Senate passed such due do a Republican filibuster.

    Our economy does not need the FUDs from continued political battles over the Debt Ceiling.

    Your piece exposes exactly what you and the AEI are about—you will do anything to gain what you call a “victory,” without regard to the damage done to the Country

  12. Good grief! Can you imagine the noise level inside the train car?! Or the HOT roof?!Looks like Soviet-style full employment project for incompetent engineers!

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