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Harry Reid Caves - No New Taxes

cpwill

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.... you know, John Boehner had a good point on Chris Wallace this Sunday. Compare where we were a year or two ago, right after the passage of Obamacare and with some calling for a second "Stimulus".... to where we are today; with even Democrats discussing the need for Trillions in cuts. Whatever happens, the Tea Party has changed the conversation in America, and for that, good on 'em. )



...House Speaker John A. Boehner, Ohio Republican, pitched his colleagues on a plan to raise the borrowing limit by about $1 trillion and match that with similar sized spending cuts — enough to last through the rest of the year, and leaving for later the heavy lifting on taxes and bigger spending items.

Meanwhile, Senate Majority Leader Harry Reid said he is working on a plan to raise the debt limit by $2.7 trillion, coupled with an equal reduction in projected future spending. In a concession to Republicans, he said that plan would not include tax increases, but that the new debt level would last through the 2012 elections....

The Associated Press reported that Republicans would release their plan Monday.

But late Sunday, Mr. Reid said he will not accept a short-term increase, and said talks with Mr. Boehner broke down. He said that’s why he is trying to write a longer-term plan...

Democrats said that while they think Mr. Boehner is negotiating in good faith, some of his fellow House Republicans would prefer to see the government fail to raise the debt ceiling at all rather than have any taxes raised.

The GOP, though, repeatedly points to the plan the House passed last week to tie a debt-ceiling increase to deep spending reductions and a promise that a balanced budget amendment to the Constitution be proposed to the states for ratification.

Democrats in the Senate voted to table that plan Friday, but they have yet to produce a budget or a debt plan of their own.


Speaker Boehner has already agreed to $800 Bn in increased revenue from closing loopholes but lowering tax rates. We shall see how the Democrats plan comes out as far as that is concerned.
 
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Call the paramedics, I think Reid has had a stroke, or maybe he was replaced with a pod person.

Liberals have to try to raise taxes to live I thought.

This is a good thing.
 
Reid was replaced by a Surrogate with Boehner at the helm. :lamo


surrogates-poster.jpg
 
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Per Fark:

Boehner, Reid work on partisan debt plans. So far, plan includes Reid giving Boehner two of his Railroads, Atlantic Avenue, Ventnor Avenue and Marvin Gardens plus a Get Out of Jail Free Card in exchange for Boardwalk and $300

Harry Reid to Republicans on the debt ceiling: "We will give you everything you want, and you give us nothing in return. This is my final offer"

And the sane ones blink. Good job. Twitter, specifically Frank Conniff, had this to say.

Two stumbling blocks stopping Tea Party from accepting any debt deal: 1. Obama is still president. 2. He's still black.
 
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.... you know, John Boehner had a good point on Chris Wallace this Sunday. Compare where we were a year or two ago, right after the passage of Obamacare and with some calling for a second "Stimulus".... to where we are today; with even Democrats discussing the need for Trillions in cuts. Whatever happens, the Tea Party has changed the conversation in America, and for that, good on 'em. )





Speaker Boehner has already agreed to $800 Bn in increased revenue from closing loopholes but lowering tax rates. We shall see how the Democrats plan comes out as far as that is concerned.

closing loopholes while lowering tax rates would probably gain nothing....
 
But if Jennifer Rubin's sources are correct:

A Republican aide e-mails me: “The Speaker, Sen. Reid and Sen. McConnell all agreed on the general framework of a two-part plan. A short-term increase (with cuts greater than the increase), combined with a committee to find long-term savings before the rest of the increase would be considered. Sen. Reid took the bipartisan plan to the White House and the President said no.”

If this is accurate the president is playing with fire. By halting a bipartisan deal he imperils the country’s finances and can rightly be accused of putting partisanship above all else. The ONLY reason to reject a short-term, two-step deal embraced by both the House and Senate is to avoid another approval-killing face-off for President Obama before the election. Next to pulling troops out of Afghanistan to fit the election calendar, this is the most irresponsible and shameful move of his presidency.

White House stokes debt-ceiling crisis - Right Turn - The Washington Post
 
closing loopholes while lowering tax rates would probably gain nothing....

"Closing loopholes but lowering tax rates?" Dumb ****.
 
the 800B was part of the "grand bargain," the obama-boehner plan, the one that fell apart when the white house moved the goal posts (after the gang of 6 came out tuesday) from 800B to 1.2T

in other words, forget it

there are no taxes, no revenues, the 800B has moved to zero

the white house is out

this deal is facilitated by the removal of obama as a player

wapo's young and talented ezra klein, founder of journolist, bonafide professional leftist and rachel maddow's favorite metrosexual, this morning:

We don't yet know what the final deal to raise the debt ceiling will be. But now that Harry Reid is developing a proposal with $2.7 trillion in cuts and nothing in revenues, it's a safe bet that it won't include any tax increases. Which means that whether Republicans realize it or not, they've won. The question now is whether they can stop.

Originally, the Democratic position was that we should simply raise the debt ceiling. Republicans said "no." There would have to be a deal that reduced the deficit by at least $2.4 trillion -- which is the size of the debt ceiling increase needed to get us into 2013.

Then the Democratic position was that we should raise the debt ceiling through a deal that reduced the deficit by about $2.4 trillion, with $2 trillion of that coming from spending cuts and $400 billion coming from taxes. Republicans said "no." There would have to be a deal that disavowed taxes.

Then the Democratic position was that we should raise the debt ceiling through a deal brokered by Barack Obama that reduced the deficit by $4 trillion, with about $3 trillion of that coming from spending cuts and about $1 trillion coming from tax increases. Republicans said "no." There would have to be a deal that disavowed taxes, and it would have to be cut between the congressional leadership of the two parties. Obama couldn't have this as a win.

That brings us to where we are now. John Boehner is proposing a deal with about $1 trillion in spending cuts and a short-term increase in the debt ceiling and a bipartisan congressional committee charged with developing a large deficit reduction package that would be immune to amendments and filibusters and would be the price of the next increase in the debt ceiling. Harry Reid is developing a package of spending cuts that Democrats could accept and would reach Boehner's $2.4 trillion mark.

Wonkbook: Republicans have won. But can they stop there? - Ezra Klein - The Washington Post

since boehner's is a short term deal, we're gonna be debating this next debt ceiling increase all thru the fall and winter, reaching this exact same crisis again next spring

with the direction this issue is taking (in february, the president published a budget that actually INCREASED borrowing 20%, it was defeated on the senate floor, 97 to 0), we've witnessed some six to eight TRILLION dollars of movement in 6 months, all towards austerity...

what do you think this debate is gonna look like in 3 months?
 
Here is my prediction. Cuts with no new taxes that takes us past 2012.
 
Frank Schaeffer Explains Why Dominionists Are Driving Debt Ceiling Brinksmanship | Crooks and Liars

Theology is -- by nature -- not about reason but about faith. If God's will is to be served then so be it if America is plunged into chaos! This debt ceiling fiasco is just another chapter in the "culture" wars.

The extreme language of Evangelical/"pro-life" rebellion has now been repackaged in the debt ceiling showdown. It is the language of religion pitted against facts.

And the anti-government charge is being led by people who are either true believers, thus unable to reason, or people catering to the true believers so that they can remain in the good books of the Tea Party, which is nothing more than the Evangelical far right repackaged and renamed.

Interesting. So the "Moral Majority" is now the Tea Party.
 
Per Fark:





And the sane ones blink. Good job. Twitter, specifically Frank Conniff, had this to say.

Had to figure out some way to play the race card.
 
Ohhh Democrats... Ohh Republicans.
Republicans: Negotiating? What a joke!
Democrats: We have no backbones..
 
all thru this debt ceiling debate the white house has had 3 solid and unshifting priorities---to lift the roof hi enough to get thru the next presidential (he needs 2.4T), to protect programs from cuts, to raise revenue

the knuckle dragging neanderthals, characteristically crass and uncompromising, have 2 simian demands---dollar for dollar (except that ratio keeps growing) and no new taxes

the administration's chaotic behavior the last few days exposes clear as stanley mcchrystal exactly what barack the slasher's TOP priority has always been

actually, that sunday nite when he turned on eric cantor and, by all accounts, reamed the reprobate from virginia---it was pretty obvious when the president stormed out of the room that nite where was his open sore

cantor was needling the president, actually interrupting him 4 times---will you VETO a short term deal?

the party in power still prefers, top priority, that LONG TERM deal

but to get such thru the house...

this caucus

and there's no time

still, that's what reid's about this morning, this last ditch effort to avoid having to have this debate all over again in the midst of the campaign

however, his 2.7T offer, generous as it sounds, is already TOTALLY FALLING APART

at least that's what i'm hearing outta the caucus

reid relies on huge savings from "military draw downs" in iraq and obama's war, afghanistan

the wingnuts and tinfoil hats, tho, see such "assets" as imaginary

boehner's 1.2 doesn't touch defense (according to ap, as well as the hill and wapo...)

My Way News - Boehner preparing to move on debt limit

fyi
 
As noted previously, I believe the negotiating approach undertaken in the debt ceiling-deficit reduction talks has been a bad one. It was an approach that invited posturing and an embrace of almost theological positions. At one point, the talks on the "grand bargain" had each side within $10 billion of one another. At that point, a genuine act of leadership would have had one side making the proposition that the difference be split (conceding $5 billion out of a potential $3.7 trillion plan is inconsequential). Speaker Boehner made no such offer to bridge the differences. President Obama threw dynamite into the emerging agreement with the suggestion to add $400 billion in revenue. Hence, even as the parties advocated their positions in good faith, the opportunity for a credible deficit reduction agreement might have been squandered.

From the sidelines, individuals arguing that the debt ceiling should not be increased at all and, to some extent, that a failure to raise it would not inflict serious harm made an already difficult negotiation even more challenging. Such individuals are irresponsible, as they simply do not comprehend the vast degree of linkage between the U.S. and global economies, much less the macroeconomic impact and contagion risk associated with a failure to raise the debt ceiling. Certain others advocated that entitlement programs be kept off the table, insisting that the compact to older Americans is almost sacred in nature. They, too, are irresponsible. Those programs are the leading source of the nation's long-term fiscal imbalances. In the absence of reform, those programs will consume a growing share of the nation's finances, squeezing out other important programs, including but not limited to Defense.

The stage is now set for the "great punt." A deal to raise the debt ceiling will likely be reached in time to avert a default. Deficit reduction associated with that deal will very likely be smaller than it would have been under the "grand bargain." At the same time, the extent of the nation's political dysfunction has been exposed and no responsible ratings agency should overlook it. Moreover, that dysfunction will almost certainly be reinforced when a significant number of representatives vote against hiking the debt ceiling.
 
So voting your conscience is now dysfunction?
 
.... you know, John Boehner had a good point on Chris Wallace this Sunday. Compare where we were a year or two ago, right after the passage of Obamacare and with some calling for a second "Stimulus".... to where we are today; with even Democrats discussing the need for Trillions in cuts. Whatever happens, the Tea Party has changed the conversation in America, and for that, good on 'em. )

Those positions are not mutually exclusive. We need more spending in the short term, and we need to cut spending in the long term. Unemployment is still at 9.2% and we are in no imminent danger of default; getting the economy back on track is more important than cutting spending right now.

At the same time, the US does indeed have some long-term fiscal problems that need to be addressed. In other threads I've outlined the basic contours of what I think we need to do to fix the four big deficit drivers: Social security, health care, defense, and tax policy. THOSE are the deficit issues that need to be solved; slashing non-defense discretionary spending (especially in the immediate future) is completely barking up the wrong tree. It will, at best, do nothing to solve the long-term fiscal problem and may actually make it worse if it inhibits economic recovery.
 
So voting your conscience is now dysfunction?

Political leaders cannot separate choices from responsibility for the consequences of those choices. Ignorance is not a valid excuse. A failure to raise the debt ceiling would lead to significant adverse consequences for the U.S. and also global economy. It would create a self-inflicted debt crisis. To make that choice, even in good conscience, is an example of dysfunction, because it is not a rational act.
 
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As noted previously, I believe the negotiating approach undertaken in the debt ceiling-deficit reduction talks has been a bad one. It was an approach that invited posturing and an embrace of almost theological positions. At one point, the talks on the "grand bargain" had each side within $10 billion of one another. At that point, a genuine act of leadership would have had one side making the proposition that the difference be split (conceding $5 billion out of a potential $3.7 trillion plan is inconsequential). Speaker Boehner made no such offer to bridge the differences. President Obama threw dynamite into the emerging agreement with the suggestion to add $400 billion in revenue. Hence, even as the parties advocated their positions in good faith, the opportunity for a credible deficit reduction agreement might have been squandered.

From the sidelines, individuals arguing that the debt ceiling should not be increased at all and, to some extent, that a failure to raise it would not inflict serious harm made an already difficult negotiation even more challenging. Such individuals are irresponsible, as they simply do not comprehend the vast degree of linkage between the U.S. and global economies, much less the macroeconomic impact and contagion risk associated with a failure to raise the debt ceiling. Certain others advocated that entitlement programs be kept off the table, insisting that the compact to older Americans is almost sacred in nature. They, too, are irresponsible. Those programs are the leading source of the nation's long-term fiscal imbalances. In the absence of reform, those programs will consume a growing share of the nation's finances, squeezing out other important programs, including but not limited to Defense.

The stage is now set for the "great punt." A deal to raise the debt ceiling will likely be reached in time to avert a default. Deficit reduction associated with that deal will very likely be smaller than it would have been under the "grand bargain." At the same time, the extent of the nation's political dysfunction has been exposed and no responsible ratings agency should overlook it. Moreover, that dysfunction will almost certainly be reinforced when a significant number of representatives vote against hiking the debt ceiling.

Good point, but as I understand it, Boehner threw the first stick by asking for the repeal of Obamacare.
 
Political leaders cannot separate choices from responsibility for the consequences of those choices. Ignorance is not a valid excuse. A failure to raise the debt ceiling would lead to significant adverse consequences for the U.S. and also global economy. It would create a self-inflicted debt crisis. To make that choice, even in good conscience, is an example of dysfunction, because it is not a rational act.

We were told yesterday that not reaching a deal on the weekend would result in a major reaction from the markets. We didn't get an agreement and the markets have gave a collective shrug today.
 
Good point, but as I understand it, Boehner threw the first stick by asking for the repeal of Obamacare.

Thanks for the info. As I was on vacation at the time, I missed that (and probably more). Such a request also would constitute dynamite that could blow up a potential deal. Negotiations should be focused on the goal at hand. Wandering into ideological territory can only undermine prospects of reaching agreement.
 
We were told yesterday that not reaching a deal on the weekend would result in a major reaction from the markets. We didn't get an agreement and the markets have gave a collective shrug today.

By whom? The only thing I heard is that Congressional leaders wanted to reach a deal by yesterday evening before the Asian markets opened out of concern that markets could react badly. I don't believe they actually predicted a catastrophic market reaction.

It is notoriously difficult to predict the specific onset of a sovereign debt crisis. A quiescent scenario now--probably based on expectations that a crisis will be averted--does not mean that the actual crisis that would result from a failure to raise the debt ceiling would be insubstantial. Any disruption that is the equivalent of around 10% of GDP is bound to have a large macroeconomic impact. Any rise in yields could significantly widen the nation's long-term imbalances. Psychology can amplify the turmoil, hence a $4 trillion deficit reduction plan might be credible at present, but if a crisis were underway, such a plan might no longer be perceived as credible, especially in the face of higher interest rates and the political dysfunction that led to the self-inflicted crisis.
 
My take was the language used. No taxes is fine, but I think some closing of loopholes is perfectly justifiable if not long overdue. But what gets me is that Reid is okay with raising the ceiling 2.7T, and offering "future" spending cuts to the tune of 2.7T ... If the good speaker thinks that's a win, he's Nutz... I trust reid like I would trust a sex offender with my daughter.. As in.. Not very much! Name the cuts, place in the bill when they will be cut, and how, and then I'll start taking these leaked reports more seriously. I repeat it is NOT a win for the tea party unless the cuts are deep, and immediate, plain and simple.

Tim-
 
By whom? The only thing I heard is that Congressional leaders wanted to reach a deal by yesterday evening before the Asian markets opened out of concern that markets could react badly. I don't believe they actually predicted a catastrophic market reaction.

First off, let's make clear I said major not catastrophic. I'm not sure why you deciding to change my words but we will get past that.

Leaders from both parties are anxious to reach a deal Sunday to head off a negative reaction in Asian markets when they open for the week, according to both Democratic and Republican aides.

Now by negative I don't think they were alluding to a normal day. Asian markets were off somewhere around 2-3%. Something that they have done many, many times. U.S. markets are off very little. No deal has seemed to have had at best a minimal impact on the markets.

U.S. Leaders Struggle To Reach Debt Deal As Deadline Clock Ticks - Politics News Story - WRTV Indianapolis

If you want to argue that even 3% is negative, it's not something that would have been worth noting.

It is notoriously difficult to predict the specific onset of a sovereign debt crisis. A quiescent scenario now--probably based on expectations that a crisis will be averted--does not mean that the actual crisis that would result from a failure to raise the debt ceiling would be insubstantial. Any disruption that is the equivalent of around 10% of GDP is bound to have a large macroeconomic impact. Any rise in yields could significantly widen the nation's long-term imbalances. Psychology can amplify the turmoil, hence a $4 trillion deficit reduction plan might be credible at present, but if a crisis were underway, such a plan might no longer be perceived as credible, especially in the face of higher interest rates and the political dysfunction that led to the self-inflicted crisis.

I'm not going to argue that not raising the debt will have no impact. It will. I'm saying that all of these deadlines are artificial and the scare tactics are just that. I've been watching the news channels today and every one notes "default". We are not going to default.
 
First off, let's make clear I said major not catastrophic. I'm not sure why you deciding to change my words but we will get past that.

The point is the same, even as I inadvertently used "catastrophic." I'm not aware of their forecasting a major impact either. They had concerns, but made no forecasts. They wanted to preempt such a situation, as the risk of a sharper downturn grows with each day an agreement is not reached.

Certainly, the markets have reacted negatively, but not yet to a substantial degree. The predominant expectation is that default will be averted, even if credible deficit reduction is foregone. The biggest early impact has been on the long-end of the yield curve, with the 30-year Treasury Bond falling 1 1/32 today. That's the end where things will first be felt. Yields on the short-end could even fall initially. However, if numerous debt default scenarios, rising long-term yields pushed countries to shorter maturities, meaning they had to roll over their debt more and more frequently. In turn, the yield relief was temporary. In time, as creditors grew more concerned, the countries began having difficulty rolling over their debt and a debt crisis finally erupted.

The U.S. is not in that position right now. But a permanent shift to higher long-term yields that will result in the absence of credible deficit reduction and, especially were the U.S. to experience even a short-lived default situation, would create incentives for the nation to emphasize the shorter-end of the yield curve. If so, then the U.S. would be traversing ground familiar in past default scenarios. The temptation to circumvent default via financial repression and inflation could increase at the same time.

I'm not going to argue that not raising the debt will have no impact. It will. I'm saying that all of these deadlines are artificial and the scare tactics are just that. I've been watching the news channels today and every one notes "default". We are not going to default.

The ratings agencies have made abundantly clear that the U.S. will be in default if it misses payments on any obligations, not just its debt obligations. That it would make payments on its debt service would be irrelevant. After all, if a company meets all of its interest payments, but fails to pay its suppliers, it is treated as a default event. That the event is not a technical debt default matters little. The government would be treated no differently by the ratings agencies. Moreover, given the political dysfunction that has been exposed by recent events, the U.S. probaby does not deserve a AAA rating on account of its elevated political risk profile.
 
The point is the same, even as I inadvertently used "catastrophic." I'm not aware of their forecasting a major impact either. They had concerns, but made no forecasts. They wanted to preempt such a situation, as the risk of a sharper downturn grows with each day an agreement is not reached.

Disagee all you want but IMO it was simply just another false goal.

Certainly, the markets have reacted negatively, but not yet to a substantial degree. The predominant expectation is that default will be averted, even if credible deficit reduction is foregone. The biggest early impact has been on the long-end of the yield curve, with the 30-year Treasury Bond falling 1 1/32 today. That's the end where things will first be felt. Yields on the short-end could even fall initially. However, if numerous debt default scenarios, rising long-term yields pushed countries to shorter maturities, meaning they had to roll over their debt more and more frequently. In turn, the yield relief was temporary. In time, as creditors grew more concerned, the countries began having difficulty rolling over their debt and a debt crisis finally erupted.

The markets aren't stupid in the idea that there is any chance of the U.S. defaulting. They aren't making moves on the possibility of that happening or not as they know it's not going to happen.

The U.S. is not in that position right now. But a permanent shift to higher long-term yields that will result in the absence of credible deficit reduction and, especially were the U.S. to experience even a short-lived default situation, would create incentives for the nation to emphasize the shorter-end of the yield curve. If so, then the U.S. would be traversing ground familiar in past default scenarios. The temptation to circumvent default via financial repression and inflation could increase at the same time.

I think I'm clear that I outright dismiss any default talk. It's not going to happen.

The ratings agencies have made abundantly clear that the U.S. will be in default if it misses payments on any obligations, not just its debt obligations.

Sorry, you'll have to provide a link to this. They have said they might still downgrade even if the U.S. doesn't default, but that isn't your claim.

That it would make payments on its debt service would be irrelevant. After all, if a company meets all of its interest payments, but fails to pay its suppliers, it is treated as a default event. That the event is not a technical debt default matters little. The government would be treated no differently by the ratings agencies. Moreover, given the political dysfunction that has been exposed by recent events, the U.S. probaby does not deserve a AAA rating on account of its elevated political risk profile.

I won't disagree that the U.S. might not deserve it's rating and I'll state that it will keep it because it's good for the rating industry.
 
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