revealed, "Fifty-three senators, 51 Democrats and two independents, signed a letter to Boehner on Wednesday vowing to oppose the House bill."
Senator Reid's plan will probably pass in the Senate, but fail in the House. However, it is not implausible that once the Boehner plan fails in the Senate, that Reid's plan won't be put to a vote. Instead, intensive negotiations that would aim to build on the overlap between the two bills and reconcile them into a single piece of legislation could commence. My guess remains that a $1 trillion -$2 trillion savings package (largely backloaded, mainly discretionary spending reductions from the baseline and no tax hikes) will be tied to the debt ceiling increase. So long as CBO indicates that the projected savings match the hike in the debt ceiling, the bill will come to a vote. If it emerges from the Congress, the President will sign it. It will be perhaps the only chance to avert a possible crisis and if it commands bipartisan support, the President will not isolate himself by vetoing it.
reid gets the president thru november, 2012, allowing leadership to dodge this fundamental question for 2 additional years
no, if something isn't done NOW to fundamentally restructure our entitlement budgets, then our big 3 federal programs (as well as state pensions) will very soon vanish
no long term extensions of credit without ANSWERS first
Two quick additional notes:
If by some chance Boehner's legislation fails in the House (probably unlikely), that could truly spook the financial markets. It would indicate that the Speaker's leverage is badly impaired and would raise serious doubts about the prospects for adopting meaningful deficit reduction legislation. In turn, that outcome would increase risk of a U.S. credit downgrade.
Politically, Speaker Boehner would have been marginalized and Republican electoral prospects damaged. In the wake of such a debacle, even as the Democrats hold a minority in the House, their leverage would increase markedly. No responsible political leader will allow a possible default, so one could reasonably expect a flight of pragmatic Republicans to any legislation that would raise the debt ceiling, even if far fewer savings than are possible now would be tied to that increase. The Republican caucus would be fractured and those differences could seriously undermine Republicans' 2012 electoral prospects. In short, the price for an overreach that doomed Speaker Boehner's legislation in a House vote would be potentially very steep for Republicans.
Boehner won't put his bill to a vote if he doesn't have the votes. I think the markets have already priced in the fact that Boehner can't control his own caucus.
Reid's plan purports to cut 2.2 trillion but puts us 2.7 trillion further in debt, so it's really a $500 billion dollar spending plan that would cover Obama through 2012.
Boehner's (revised) plan cuts 917 billion to put us 900 billion further in debt. It provides next to nothing in real cuts, but only takes us into next Spring, when he'll ask for an additional 1.8 trillion in cuts to raise the ceiling.
1 trillion (45%) of Reid's "cuts" are attributed to "winding down the wars in Iraq and Afghanistan." That's going to happen anyway, so if you factor that out, as the CBO did - Reid's plan reduces outlays by $750 billion, whereas the CBO predicted an 851 billion dollar reduction for Boehner's plan.
CNN: Reid debt ceiling plan comes up short - Jul. 27, 2011
The Congressional Budget Office on Wednesday said the proposal by Senate Majority Leader Harry Reid, which would raise the debt cap by $2.7 trillion, would reduce deficits by $2.2 trillion.
In terms of spending, the CBO estimates that the Reid plan it was given would cut $1.8 trillion.
But that's because the Reid plan takes credit for cutting $1 trillion in war spending in Iraq and Afghanistan. Those savings can only be claimed if one assumes the U.S. engagement there will continue at full throttle for the next decade.