In 1987 current Presidential Candidate Donald
J. Trump wrote a book entitled, “Trump The Art of the Deal.” This post is not about that. Rather, it is about the budget deal
tentatively struck by Congress and the White House Monday evening. The measure will likely be voted upon
today. This is key, and leaves no margin
for error.
The urgency, in part, stems from the desire of
House Speaker John Boehner to execute and dispense of the matter prior to the
vote to elect a new Speaker, also tentatively scheduled for today, to elect Rep.
Paul Ryan to the Speaker’s position. In
the world of Washington politics, a lot has to go right for all this to happen.
First, not everyone is on board with the new
budget. That includes Rep. Ryan; sort
of. In fact, Mr. Ryan strongly condemned
even the way the accord was put together.
He explained he had not even laid eyes on it. He said:
“About
the process, I can say this: I think the process stinks. Under new management, the people’s business
will be conducted differently.”
Beyond the Ryan objections, it’s fair to say a
number of the House and Senate’s most conservative members have reservations,
objections, or concerns about the deal.
In fact, to reach the deal, compromise, a word that has become anathema
in the hallowed Halls of Congress in recent years, had to be reached. And it was.
The House Rules Committee met late into last
night in an effort to ensure the deal reached the House floor by today. One key sticking point was a reduction in
crop insurance payments; a move designed to raise $3 billion over ten
years. A number of the top members of
the Senate Agricultural Committee released a statement yesterday opposing the
deal. Committee Chairman Michael Conaway
(R-Texas) said:
“Make no
mistake, this is not about saving money, it is about eliminating Federal Crop
Insurance. The House Agricultural
Committee was not consulted regarding any changes to policies under the
jurisdiction of our committee.”
Also on the concerns side of the ledger,
following Tuesday morning’s meeting, some conservatives complained that the
budget negotiations were conducted without the input of committee chairs and
rank-and-file members. It is however,
unlikely that they will have the numbers to derail the pact, that is, presuming
Democrats and moderate Republicans stay onboard. Representative John Fleming, a member of the
House Freedom Caucus, said:
“I don’t
know if this thing could pass. It could
break apart, and we could begin tackling this piecemeal well into Paul Ryan’s
Speakership.” Or so it would seem, he
hopes.”
Representative Tom Cole, a centrist, said:
“The
deal isn’t perfect, but it prevents default and gives certainty to the
military, while making long-term reforms to Social Security and Medicare. I think it’s a pretty good choice to
make. It’s a compromise and that means
we had to give some things up that we don’t want, but we got some great things.”
Concerns notwithstanding, aides downplayed the
risks that reservations about the issue could alienate enough votes to damage
the deal.
The gist of how, why, and when all of this came
about is tied directly to politics and timing.
It has been two years since Congress and the White House has reach
genuine bi-partisan budget compromise.
This…is that. Speaker Boehner,
who resigned a few weeks ago, effective October 31st, wanted very
much to craft/negotiate a budget deal, and get it approved before he left his
position, and his Congressional Seat. He
considered this a parting gift to Mr. Ryan, who will likely assume the reins of
the Speakership tomorrow after the vote on the budget, if successful. Speaking about brokering the compromise yesterday,
Speaker Boehner admitted he was cleaning a “dirty barn” for his likely
replacement, Rep. Ryan, who was not involved in the secretive
negotiations.
More precisely, Boehner said that he crafted
the deal before his departure because he didn’t want the new Speaker “to walk
into a dirty barn full of you know what.”
He conceded that the package should have been assembled in a more
inclusive way. He went on to add, “This
is not the way to run a railroad.”
Ultimately, the leadership of the House and
Senate privately negotiated the deal.
Those actively involved included Speaker Boehner, House Minority Leader
Nancy Pelosi, Senate Majority Leader Mitch McConnell, and Senate Minority
Leader Harry Reid. The group kept a
tight lid on the negotiations. They
revealed the deal only after it was complete.
Minority Leader Pelosi embraced the agreement
yesterday, signaling that the 188 House Democrats could provide a large portion
of the vote needed to get a majority in the House. She indicated:
“The
bi-partisan budget package unveiled Monday night represents real progress for
hard-working families across the country.
I look forward to working toward House passage of this proposal this
week. Next, we must move forward to
complete the appropriations for FY2016 and keep government open.”
If Representative Pelosi and House Minority
Whip Steny Hoyer can deliver votes from most, if not all, of their members, Mr.
Boehner will have to win the support of only about 40 to 50 Republicans to pass
the deal.
The Vice President, Joe Biden, praised the deal
yesterday. He said:
“The
last seven years, we’ve gone from crisis to recovery, and we’re on the verge of
being able to have a genuine economic resurgence here. And what we’ve put together is a good
deal. No one got everything they
wanted. But it will last for two years
and it will prevent us from lurching from crisis to crisis.”
Yesterday, Senator McConnell said to reporters
that the agreement reaches issues important to Republicans, including more
money for defense programs and offering funding increases through spending cuts
rather than increases. He added:
“I’m
hopeful and optimistic that the bill will come over to the Senate, and when it
does, we’ll take it up.”
By most early accounts, key Senate Republicans
are also on-board. Among them, Senator
John McCain, Chairman of the Armed Services Committee, said he would support
the deal because “It restores all but $5 billion of the defense
requirements.” He noted that if the
budget agreement passes, he could move quickly to adjust and pass the National
Defense Authorization Act that was recently vetoed by President Obama over
Budget concerns. Backing by McCain
virtually insures the support of other defense hawks, including Senator Lindsey
Graham, a GOP Presidential Candidate.
About the deal, Senator Graham said:
“We’re
in a box here. But if Senator McCain is
okay with it, then I’ll probably be okay with it.”
The White house also weighed in. One White House official said:
“The
agreement reached by congressional leaders last night meets these key tests: It
provides substantial relief from harmful spending cuts, and it does so equally
on the defense and non-defense sides of the budget.”
It should be noted that the deal is not a
complete victory for Democrats, who wanted even more spending increases and
hoped to pass an increase without including it in a broader budget deal. President Obama has insisted that the debt
limit not be used as a negotiating tool for spending cuts. The proposal will allow the President to say
he secured a bargain on a scale that has not been seen since the 2013 agreement
between Mr. Ryan and Senate Budget Committee (then) Chair Senator Patty Murray.
Democrats will still get to celebrate a
messaging victory and will probably take credit for the deal. Senator Charles Schumer pointed out that that
the proposal is the kind of spending agreement he and other Democrats have been
promoting. He also said:
“For
months, we Democrats have asked for a budget that increases spending
significantly above sequester levels and does so in a way that is equally
balanced between defense and key middle-class programs. The agreement does both.”
There are several key elements of the
bipartisan deal, which constitutes a win for both the economy and budget
discipline. Some of these points
include:
Bipartisan Debt Deal
•
Removes the cloud of uncertainty over
our economy at this critical time, by ensuring that no one will be able to use
the threat of the nation’s first default now, or in only a few months, for
political gain;
•
Locks in a down payment on significant
deficit reduction, with savings from both domestic and Pentagon spending, and
is designed to protect crucial investments like aid for college students;
•
Establishes a bipartisan process to
seek a balanced approach to larger deficit reduction through entitlement and
tax reform;
•
Deploys an enforcement mechanism that
gives all sides an incentive to reach bipartisan compromise on historic deficit
reduction, while protecting Social Security, Medicare beneficiaries and
low-income programs;
•
Stays true to the President’s
commitment to shared sacrifice by preventing the middle class, seniors and
those who are most vulnerable from shouldering the burden of deficit reduction.
The President did not agree to any entitlement reforms outside of the context
of a bipartisan committee process where tax reform will be on the table and the
President will insist on shared sacrifice from the most well-off and those with
the most indefensible tax breaks.
Mechanics of the Debt Deal
•
Immediately enacted 10-year
discretionary spending caps generating nearly $1 trillion in deficit reduction;
balanced between defense and non-defense spending.
•
President authorized to increase the
debt limit by at least $2.1 trillion, eliminating the need for further
increases until 2013.
•
Bipartisan committee process tasked
with identifying an additional $1.5 trillion in deficit reduction, including
from entitlement and tax reform. Committee is required to report legislation by
November 23, 2011, which receives fast-track protections. Congress is required
to vote on Committee recommendations by December 23, 2011.
•
Enforcement mechanism established to
force all parties – Republican and Democrat – to agree to balanced deficit
reduction. If Committee fails, enforcement mechanism will trigger spending
reductions beginning in 2013 – split 50/50 between domestic and defense
spending. Enforcement protects Social Security, Medicare beneficiaries, and
low-income programs from any cuts.
When you come right down to it, there
are many angles to this proposed deal.
There are forces that promote it; factions that oppose it, and a fringe
that is watching to see who is for it and who is against it. I don’t have a crystal ball, but my reading
of the tealeaves suggests, despite Senator Rand Paul’s pledge to filibuster the
bill, the President, Democrats, and a fragile and fleeting coalition of Republicans,
buoyed by the urging of outgoing Speaker Boehner will carry the day. That result would in effect provide the
Speaker with a parting victory, Mr. Ryan with the gift of a clean slate…or
barn, as it were, and the American People with a winning budget proposal, courtesy
of “The Art of the Deal: The Budget Deal, That Is!”
I’m done; holla back!
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