Back in May, House Speaker John Boehner went before the Economic Club of New York to offer the GOP’s opening bid on debt-ceiling negotiations. His demands were straightforward: Republicans would only support raising the debt limit if it came with cuts that would exceed the increase in borrowing power. In his own words, “Cuts should be greater than the accompanying increase in debt authority the president is given. We should be talking about cuts of trillions, not just billions. They should be actual cuts and program reforms, not broad deficit or debt targets that punt the tough questions to the future.”
I wrote at the time that this was an “extraordinarily radical” proposal that would cost thousands of jobs and deprive millions of needed benefits while preserving huge tax cuts for the wealthiest Americans. Now, after nearly three months of Republican intransigence, that radical proposal is the template for the Democratic offer on the debt limit.
According to the Congressional Budget Office, Senate Majority Leader Harry Reid’s debt ceiling “compromise” would trade $2.2 trillion in deficit reduction over the next ten years for a $2.7 trillion increase in the debt limit. The majority of savings would come from $1.2 trillion in cuts from discretionary spending as well as savings from winding down combat operations in Iraq and Afghanistan.
Even if you accept the premise that something like this was inevitable – that Democrats had no choice but to eat crow after Republicans won the House with a strong right-wing majority – it’s hard to swallow the extent to which the national debate has swung to the far right. When demand is low and more than 14 million people are unemployed, it’s perverse to push spending cuts of any magnitude, to say nothing of cuts that would start by slashing tens of billions from discretionary programs.
Of course, it goes without saying that the Republican plan -- crafted by House Speaker John Boehner -- is worse. In its first year, Boehner’s plan would reduce spending by $1.2 trillion, impose limits on future spending, and require Congress to vote on a balanced-budget amendment (i.e. The Worst Idea in Washington). For all of this, the president receives a $1 trillion increase in the debt limit. In its second year, the plan would create a bipartisan committee to find another $1.8 trillion in savings – to be drawn from entitlement programs – and its proposal would not be subjected to amendment or Senate filibuster. In exchange for this, Republicans will authorize a second debt limit increase of $1.6 trillion.
Not only would this give Republicans a second opportunity to play chicken with the country’s credit rating, but as the Center on Budget and Policy Priorities President Robert Greenstein explains, those cuts would require the federal government to either cut Medicare and Social Security benefits for current retirees, repeal the Affordable Care Act, or “eviscerate the social safety net for low-income children, senior citizens, and people with disabilities.” Either way, Greenstein writes, the plan “could well produce the greatest increase in poverty and hardship produced by any law in modern U.S. history.”
That these are our options -- that this is even up for debate -- is a colossal failure of our political culture.