I just saw that a debt agreement had been reached. So, rather than quote just the usual sources, I thought I’d tale a look at what a liberal sources had to say. First off, here are the details of the agreement from Talking Points Memo…
The deal works like this:
It guarantees the debt limit will be hiked by $2.4 trillion. Immediately upon enactment of the plan, the Treasury will be granted $400 billion of new borrowing authority, after which President Obama will be allowed to extend the debt limit by $500 billion, subject to a vote of disapproval by Congress.
Given that the GOP has only control of the House, it was never realistic to not raise the limit. Though the thought of borrowing more is disgusting, it can’t be avoided right now.
That initial $900 billion will be paired with $900 billion of discretionary spending cuts, first identified in a weeks-old bipartisan working group led by Vice President Joe Biden, which will be spread out over 10 years.
In all reality, don’t count on anything ever being cut. The Democrats have not, in at least recent history, ever lived up to any agreement to make spending cuts.
Obama will later be able to raise the debt limit by $1.5 trillion, again subject to a vote of disapproval by Congress.
With control on only one House of Congress, there is little chance that this will be cleanly shot down. In fact, I would predict that this gives the Democrats yet another opportunity to engage in class warfare.
That will be paired with the formation of a Congressional committee tasked with reducing deficits by a minimum of $1.2 trillion. That reduction can come from spending cuts, tax increases or a mixture thereof.
Here’s yet another round of class warfare in the waiting. I get the impression that the Democrats want a war of attrition over every detail of a plan. Then, of course, the MSM will pile on, and with each engagement, attempt to wear down the GOP.
If the committee fails to reach $1.2 trillion, it will trigger an automatic across the board spending cut, half from domestic spending, half from defense spending, of $1.2 trillion. The domestic cuts come from Medicare providers, but Medicaid and Social Security would be exempted. The enforcement mechanism carves out programs that help the poor and veterans as well.
The Dems know that the GOP will not want to cut defense. Then again, they aren’t going to want to cut domestic spending either. Consider this yet another opportunity for class warfare attrition.
If the committee finds $1.5 trillion or more in savings, the enforcement mechanism would not be triggered. That’s because Republicans are insisting on a dollar-for-dollar match between deficit reduction and new borrowing authority, and $900 billion plus $1.5 trillion add up to $2.4 trillion.
However, if the committee finds somewhere between $1.2 and $1.5 trillion in savings, the balance will be made up by the corresponding percentage of the enforcement mechanism’s cuts, still in a one-to-one ratio.
Democrats say they’re confident that the enforcement mechanism is robust enough to convince Democrats and Republicans to deal fairly on the committee — to come up with a somewhat balanced package of entitlement reforms and tax increases. However, the White House assures them that if the committee fails to produce “tax reform” he will veto any attempt to extend the Bush tax cuts, which expire at the end of next year.
Here is Obama’s “nuclear option.” If the GOP doesn’t raise taxes, he will himself. Of course, at the end of next year, he will likely be lame duck Obama, so he wouldn’t mind a bit of scorched Earth to salt the fields for a new POTUS, and a new Congress. Also, that would set up the first class warfare battle for the next POTUS. If Obama wins in 2012, it won’t matter anyway.
As I look at this, it seems that the Democrats want repeated opportunities to engage in a war of attrition via class warfare. Here’s how it will unfold:
1. With every cut, the Democrats, and their fellow travelers in the MSM, will paint the GOP as serving the evil rich, hating the poor, and so on. In other words, expect nothing different.
2. I say that this is a war of attrition because the Democrats are losing approval points over this in a big way. Obama is also taking a big hit, not only with the public at large, but with his own base as well. Then, add to that the fact that he seemed almost irrelevant to the process, and the plan, as it is today, has no immediate tax increases in it-contrary to his many statements on the issue. In other words, he seemed impotent and irrelevant. That is as close to the truth as most Americans have seen.
3. While they know that they’re taking massive political damage from their actions in the debate, as well as from the utter overall failure of their policies, the Democrats want to make the Republicans look WORSE. Hence, the war of attrition. They hope to place enough blame, play enough class warfare, and flat out lie enough to make the people think that Obama and the Democrats are nothing more than the victims of those “mean Republicans,” and their corporate masters. I don’t see it being enough to save Obama, but that won’t stop them from trying.
Anyway, that’s my initial take on the situation. I’m sure I’ll think of more as time wears on. As this continues to unfold, I’m sure that there will be a lot more for bloggers to digest. In other words, the fun is just getting started.