“Despite good-faith efforts to find common ground, the White House will not pursue a bigger debt reduction agreement without tax hikes. I believe the best approach may be to focus on producing a smaller measure, based on the cuts identified in the Biden-led negotiations, that still meets our call for spending reforms and cuts greater than the amount of any debt limit increase.”
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“I got this from a GOP congressional source later in the afternoon:
“WH is demanding major, unambiguous tax hikes. To get spending caps & entitlement tweaks, greater economic pain appears to be the WH’s asking price. It is increasingly likely that we aren’t going to see a ‘big’ deal if the WH doesn’t budge. Speaker looks to be holding strong…
“[Update 7:39 PM] Appears that the basic framework for future tax reform could not be resolved.
“The bipartisan consensus on tax reform (broader base & lower rates) was championed by President’s fiscal commission, and yet now is being rebuked by the President. Lowering top rates that would help make America more competitive was too large a leap for a true class warrior.”
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“Tax reform is a worthwhile policy goal, and Mr. Boehner is right to pursue it. But the only way he can avoid being taken for a ride by Democrats is if all parts of any deal are negotiated, voted on and then implemented immediately. Two men, one deal, once. Promises of future action aren’t credible.
“Even if Mr. Obama is sincere on tax reform, he can’t guarantee he can deliver Senate Democrats who are desperate to keep their majority in 2012, much less Nancy Pelosi. We’re told that in Thursday’s White House meeting, Mr. Obama promised to veto any short-term debt-limit deal to give the two sides more time to negotiate. If that’s true, then the President isn’t serious. It means he is using the pressure of the August 2 deadline to bull-rush Mr. Boehner into a bad deal.
“If Mr. Obama is sincere about a long-term spending and tax reform agreement, he’ll take the time to get it right. If he insists on issuing ultimatums, then House Republicans would be better off passing a debt-limit ceiling for a few months with comparable spending cuts and letting Senate Democrats do the same. Mr. Boehner shouldn’t bet his majority on Mr. Obama’s promises.”
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“In the latest salvo in their campaign to portray Republicans as extremists for not wanting to accept tax increases as part of a budget deal, liberal bloggers led by Ezra Klein have been promoting a chart showing that in the past, the GOP has been willing to accept deals that are far less generous than what President Obama is supposedly offering them. Yet as Conn Carroll pointed out earlier, there’s a big difference between budget deals as negotiated, and budget deals as implemented. The reason why today’s conservatives are much less tolerant of deals that include tax hikes is that they’ve learned from history that the reality of such agreements is that taxes go up as negotiated, but Congress doesn’t deliver the promised spending cuts. No past deal poisoned the well more than the 1990 budget pact, in which President Bush infamously broke his ‘no new taxes’ pledge…
“Back in 1990, the establishment was saying the same things about the need for a ‘balanced approach’ in which all sides sacrifice something to reduce the deficit. Yet what we ended up with in reality was a deal that raised taxes and slashed military spending (in other words, the liberal approach) while entitlements and non-defense discretionary spending rose by an even higher amount than was projected before a deal. Is it any wonder that today’s conservatives are deeply suspicious of budget deals in which Republicans agree to raise taxes in exchange for promised spending cuts?”
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“The media will initially be all excited about the deal, but will turn almost instantly towards declaring it has no chance to pass, seizing on every criticism of the package or declaration of opposition as sure-fire signs the proposal is dead. The outcry against the package (both before and after the details are known) will be intense on both the left and the right. Interest groups from all quarters will denounce the measure as unacceptable. National security conservatives, for example, will declare that the Pentagon cuts will eviscerate America’s ability to defend itself; liberal groups will deem the entitlement reductions unacceptable. Thumbs down will also come from Paul Krugman, Rush Limbaugh, and every Republican running for president in 2012…
“As the House prepares to vote, the media will declare again that there is virtually no chance of passage. Strange-bedfellow allies, including prominent elements of Big Business and Big Labor – plus, inevitably, Bill Clinton – will make the ‘don’t let the perfect be the enemy of the good’ argument in public and in private. As the measure’s details become more known, there will be another round of fly-specking from webizens of the left and the right, declaring the package the worst thing ever considered by Congress in American history. Obama will give some blockbuster speech explaining why the bill must pass. The measure will appear dead both before and immediately after his speech. Then a handful of liberal and conservative House members will come off the fence and declare themselves in favor (some might even flip from declared opposition)…
“And, then, the bill will heart-stoppingly pass the House, with some secret backroom deals and lobbying that will be revealed (if ever) only long after the fact. Reps. Bachmann and Pelosi will vote against. And then it will fully dawn on Boehner and McConnell at the White House signing ceremony (likely as Obama is handing them their souvenir pens) that they were part of history, including part of the part where Obama was able to take off the table the single most damaging issue that could be used against him in 2012.”
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“Politicians have always postured in public and played poker in private, but as both sides dithered over the debt ceiling, even grizzled veterans grew disgusted. ‘My side’s just as guilty. I think we’re going to have a crisis because politics is going to trump the good of the country,’ says Republican Sen. Tom Coburn. ‘It doesn’t sound like there are any real adults any more, including in the White House.’”
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