Today, in a blog post on the Treasury website, Jenni LeCompte gets at why the “McConnell Provision” is essential in a world where Congress has shown a fondness for playing Russian Roulette with a fully loaded gun. “Extension of the McConnell Provision would lift the periodic threat of default from the U.S. economy and remove politics from future debt limit debates,” she notes, “while preserving Congress’ essential role in spending, revenue and borrowing decisions.”
As the chart shows, once the Treasury comes within $100 billion of reaching its debt limit, the president sends a certification letter to Congress that confirms further borrowing authority is needed. If Congress disapproves it must pass a Joint Resolution of disapproval. But if Congress does pass a Joint Resolution of disapproval, the president can veto it. Once the measure goes back to the House and Senate, each chamber must override the veto by a two-thirds majority vote. If the disapproval measure is not enacted within 15 days the limit is raised to the level the president says is needed to meet the nation’s existing financial obligations.
The politics of all this are oh so rich. By calling it the “McConnell Provision,” Geithner is going one step further than he did on “Meet The Press” when he talked about the idea. “[T]he virtue of that mechanism proposed by Sen. McConnell, a man of impeccable conservative credentials, is to make sure that the country is not left at risk of periodic threats of default,” Geithner said. “It’s a very good idea. It was a Republican idea. And we’re suggesting they extend it.”
Geithner was laying it on real thick. But it is a very good idea. And, now, by naming his proposal after McConnell, Geithner is laying the whole thing around the Kentucky Republican’s neck. The Minority Leader reportedly laughed out loud when he heard about the proposal. I wonder if he’s laughing now.