July 30, 2011
Drop Dead Date for DisasterBy William L. Gensert
The key to any negotiation, whether in business or on the legislative battlefield with respect to raising the debt ceiling, is to understand where you are strong and where you are weak. In the current debt negotiations, the Republicans are both strong and weak. They would do well to understand this, because this is where they can have an advantage.
It's clear from his vitriolic speeches and serial, changing demands that the president does not understand either his strengths or weaknesses. At first, ignoring the results of last year's elections, he thought he had the power to demand a "clean" debt increase, one without any cuts in spending. Then, he thought he could decree a large enough increase in his power to borrow to get him through next year's election without having to discuss his profligate ways. After that, it was about a "balanced approach," which is code for his politics of bitterness and envy, the purpose of which is to sock job-creators and the "greedy" rich with onerous tax increases, in the interest of fairness. Now, having misplayed virtually every advantage he has as president, he has made himself largely irrelevant in this ongoing drama, with the exception of his power to veto.
Barack Obama has added $4 trillion to the national debt in the 2½ years he has been president. His Stimulus, a trillion-dollar effort to insulate public-sector employees and political backers from feeling any pain caused by the economic downturn, exploded the budget baseline. Despite his efforts to blame George Bush, the president's uncontrolled spending has largely been responsible for the crisis we have today.
The media has sold the public on August 2 as the drop-dead date for disaster, but failing to increase the debt ceiling does not have to be Armageddon.
In a worst-case scenario, where the debt ceiling is not raised in time, enough money comes into the Treasury, an estimated $200 billion monthly, to pay the nation's obligations. With approximately $300 billion spent by the federal government each month, it's all the "extras" we will not be able to afford.
Social Security, Medicare, pay for our men in uniform, and debt service -- there's enough cash for that. Perhaps we will have to close the NLRB and the Department of Agriculture, or maybe the Department of Energy and the Department of Education, or, god forbid, furlough some government employees. We could start with all those new federal workers the administration has hired in the last two years
I don't see a downside to that. We as a nation and people have had 2½ years of misery under this president, while the president's political patrons, federal employees, and government agencies have had nothing but sunny days and prosperity.
While the unstimulated private sector lost 2 million jobs, the federal government added 200,000 workers. Good thing, too -- now the government is so much better-run, isn't it?
If we were honest with ourselves, we would call the Obama administration's expansion of the federal workforce a naked attempt at vote-buying, or, perhaps, votes "saved or created."
Temporarily laying off a couple of hundred thousand federal employees in an economy where 400,000 new claims for unemployment benefits are coming in every week may not be a "balanced approach" in a real sense, but it's a nice start. Wouldn't you agree?
It won't happen, however. The most political president of all times and his minions in the Senate wouldn't dare let it get to that. In today's acrid political environment, I can't see either the Senate or the president having the gall and guts to table a solution to a crisis of their own making. The political fallout would be cancer to candidate Obama, as well as the 21 Democratic party senators up for reelection next year.
The Boehner plan may not be the best, or even as good as he maintains it is. It is, however, the best we can accomplish with this president and this Senate. Remember, it wasn't long ago that we were discussing plans with massive, job-killing taxes increases.
What we have today, with Republican control of the House of Representatives, is a minority with the power to block, not a majority with the power to rule. For that, we will have to wait until the 2012 elections.
Passing this legislation in the House is essential not only for the Republican Party as a partisan organization, but for the future of the nation as well. It changes the entire tenor of the discussion, which is the whole point. For the first time, an increase in the debt ceiling is tied to cuts in spending. The Republicans will accrue credit for that, even if the spending cuts aren't all we had hoped they could be.
Politically weakening the president and his party in time for next year's elections should be the paramount goal, not purity of purpose. We can't fix everything today, while controlling only half of one third of the federal government. It would be foolish to snatch defeat from the jaws of victory.
As remote as the possibility is, if the Senate does vote down the debt increase legislation or the president vetoes it, so be it -- it will be on their heads.
No matter how they and the press try to spin it, all the public will see is that Republicans presented a plan to deal with the debt crisis, and the president and his party rejected it, for purely political reasons and to the detriment of the nation.
The last time this happened in 1995, the Republicans were blamed for the shutdown in government. This time, it will be the man without a plan who will bear responsibility.
"Barack Obama, the president who presided over a nation's default and the downgrading of our debt" may not be an entirely true statement, but it does make a great sound bite.
It is ironic that should the president be foolish enough to accept that, the Republican nominee for next year's presidential election can surely run on a platform of "Hope and Change."
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