Senate Minority Leader Mitch McConnell (R-Ky.) floated a novel way out of default Tuesday, suggesting that Congress give up its power to raise the debt ceiling, and instead effectively transfer that authority -- and the political pain that comes with it -- to the White House for the remainder of Obama's current term.Democrats have offered historic $4 trillion dollars in spending cuts. Republicans want all that without cutting out some tax loopholes so they're walking away. Potentially sending the country into an recessionary spiral. You can tell when someone is an America hating brat when you offer them 90% of what they want and it is not enough.
With eight days until the administration-imposed deadline to reach a deal, Senate Majority Leader Harry Reid (D-Nev.) told reporters he had no plans to "trash" McConnell's plan and would give it a close look.
Under current law, Congress raises the debt ceiling, which allows the Treasury Department to issue more bonds to pay off debts and fund projects that Congress has already authorized. Raising the debt ceiling does not authorize or appropriate new spending, but merely settles old bills.
Yet under McConnell's plan, which he called his "last-choice option," the White House would request an increase in the debt ceiling and Congress could only block that request with a veto-proof super majority -- effectively ceding control over the debt limit to the White House. A super majority would likely be difficult to amass, especially when neither party's leadership genuinely wants the nation to default.
McConnell said he believes the votes exist in the Senate to pass a bill that would establish such a debt-ceiling regime. If House Democrats went along, fewer than 25 Republican House votes would be needed to make the bill law. How congressional leadership could marshal those votes, however, remains a mystery.
The novelty of McConnell's plan made those on Capitol Hill more pessimistic, moving genuine fears of default from the fringe to closer to center stage.
"This is not my first choice," McConnell said at a press conference Tuesday."I had hoped all year long that the opportunity presented by his request to raise the debt ceiling would generate a bipartisan agreement that would begin to get our house in order reducing spending."
"That may still happen, I still hope it will," he added, "but we're certainly not going to send a message to the markets and to the American people that default is an option."
The bill would require the president to recommend spending cuts -- without revenue-raisers -- in the same amounts of a debt ceiling increase request, although actually passing the cuts would not be necessary to raise the debt limit.
"It gives the president 100 percent of the responsibility for increasing the debt limit," Sen. Lamar Alexander (R-Tenn.) told reporters after the press conference.
The debt limit would be increased three times during Obama's term: First, by $700 billion over the next few weeks, then $900 billion in the fall and another $900 billion in the spring, McConnell said.
But the bill doesn't guarantee that spending cuts will happen, McConnell said.
"We have become increasingly pessimistic that we will be able to reach an agreement with the only person in America who can sign something into law, and that's the president," he said.
McConnell said he has "spoken about it with others," but would not comment on whether House Speaker John Boehner (R-Ohio) is open to the idea.
Reid said he had received a call from McConnell about the plan.
"[McConnell] has a proposal that some of you have looked over," Reid said. "He'll explain that to you. I'm not about to trash his proposal. It's something that I will look at."
"It sounds like the ultimate punt," said one senior Senate Democratic aide.
Wednesday, July 13, 2011
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Mitch McConnell Debt Ceiling Plan: Senate GOP Leader Offers Alternative To Obama's 'Grand Bargain'