Time for the grown-ups to enter the debt showdown
THE DEBATE over raising the debt ceiling has passed the point of usefully concentrating the mind on the need for debt reduction. Now the hanging moment is nigh. It is time for the remaining grown-ups in Washington — and we trust there are some — to figure out how to help the country slip off the noose. The debt ceiling needs to be lifted. The alternative is unthinkable.
The House spent the day Thursday debating a plan that it knew the Senate would not pass and the president would not sign. Then, as time was running out, House Speaker John A. Boehner (R-Ohio) abruptly postponed the vote, an indication that he lacked the necessary votes from his out-of-control caucus. Even if the speaker manages to push his package across the finish line, it will be dead on arrival in the Senate.
It is an ominous sign that House Republicans have become so extreme that they have difficulty mustering enough votes to pass a plan that includes close to $1 trillion in cuts now and sets the stage for another $1.8 trillion to be identified later as the price of lifting the debt ceiling. The no-way caucus is the modern incarnation of the Flat Earth Society, denying the reality that the ceiling must be lifted and that the consequences of failing to act would be devastating to the economy.
By any reasonable accounting, Republicans have won a significant part of what they demanded; they are simply unwilling to declare victory. The debt ceiling will not be lifted in a clean vote, as the administration initially sought, but in concert with an agreement for massive spending cuts, now and in the future. No new tax revenue is called for — and while the super-committee to come up with additional savings might theoretically propose new taxes, Mr. Boehner assured Rush Limbaugh that wasn’t going to happen.
At this point, the only path forward in the House is one that brings together the relative moderates in both parties to what passes for a middle ground. This may be treacherous to Mr. Boehner’s speakership, but it is essential for his country.
The Senate, of course, is dysfunctional in its own way. The requirement to obtain 60 votes for passage and the time that can be eaten up with a filibuster are equally treacherous as the clock ticks down to default. The package that has been assembled and is in the midst of being rejiggered by Senate Majority Leader Harry M. Reid (D-Nev.) is padded with accounting gimmicks, but it similarly gives Republicans much of what they ought to be willing to accept: cuts now and the prospect of more later.
The major difference between the Reid and Boehner approaches has been whether to link the second wave of savings to the debt ceiling extension. The House approach would make another increase in the ceiling contingent on a package of cuts and subject the country to a second budget crisis before the 2012 election. The White House is desperate to avoid this result, and while there may be no small element of politics in its calculation, it is also true that holding the debt ceiling hostage during an election year is not likely to produce an attractive result.
There are important principles to keep in mind as the deadline nears. First, the Republican demand for a dollar-for-dollar ratio of spending cuts to ceiling increase is rooted only in symbolism. Second, although no one expects a balanced agreement at this point, the deal should not be rigged so as to effectively preclude revenue increases. Third, the White House is right to try to avoid a pre-election replay, but that should not be the sole consideration. It is at least as important to structure the enforcement mechanism the right way: The trigger to make certain that savings are actually produced should not tilt entirely in the direction of spending cuts.