The House just passed the GOP’s plan for a temporary debt limit extension, 285-144. The threat of default has been averted — in exchange for no concessions whatsoever by Dems. This confirms what some of us knew from the start: Republicans were never — ever — going to allow default. Those who played along with the fantasy that the threat of default gave Republicans leverage got snookered. They got taken.
Today’s vote, in effect, removes the threat of default from the conversation permanently, which is good news for the country. There is very little chance that the coming battle won’t be resolved before the next debt limit deadline of May 18th. In any case, if Republicans try to tie any more conditions to the next debt limit hike, Dems will simply laugh in their faces, since they confirmed today that they are not willing to allow default, no matter what. So now the GOP will try to use the expiring sequester and the threat of a government shutdown to extract the spending cuts it says it wants.
But all this means is that Republicans are simply trading one charade for another one. GOP leaders mollified House conservatives angry about today’s vote by vowing to stick to a souped up version of the Paul Ryan fiscal blueprint, one that will make deficits disappear in a mere 10 years, with no new revenues. This is a fantasy. Jonathan Chait does some back of the envelope calculations and estimates it could mean Republicans “will have to cut domestic discretionary programs and spending for the poor by about half.” As Chait concludes: “Boehner has committed now to voting on something that would require even more draconian cuts to social spending than the Ryan budget.” Needless to say, no deal will be possible if the GOP sticks to anything close to this blueprint.
This isn’t to say the road ahead for Democrats is smooth. The threats of the sequester and a government shutdown are serious, and the possibility that Dems will give up significantly more in spending cuts than liberals would like is very real. Senate Dems will now have to pass their own budget. That could be tricky, but it also may be an occasion to formally restate the Dem insistence that we must have more in revenues via closing loopholes enjoyed by the wealthy. Republicans appear confident that this will force Dems to vote for a politically difficult “tax hike,” but as the last election showed, the public prefers such tax hikes to the types of cuts House Republicans will now find themselves forced to propose.
We’re basically back where we started, which is that Republicans are demanding deficit reduction only through massive spending cuts while simultaneously refusing to permit any more in revenues from the rich. Until Republicans let go of this political hokum, the fundamental underlying argument will remain unresolved. This was true before the debt limit fantasy took flight, and it will continue, now that this fantasy crashed and burned.