Mr. Boehner now has the GOP positioned in sight of a political and policy victory. If his plan or something close to it becomes law, Democrats will have conceded more spending cuts than they thought possible, and without getting the GOP to raise taxes and without being able to blame Republicans for a debt-limit crackup or economic damage. If conservatives defeat the Boehner plan, they’ll not only undermine their House majority. They’ll go far to re-electing Mr. Obama and making the entitlement state that much harder to reform. – The GOP’s Reality Test – Republicans who oppose Boehner’s debt deal are playing into Obama’s hands.
The devil is now the possibility of the U.S. being downgraded, with no details on how to stop it at this point. But with the Tea Party caucus showing Ben Affleck’s “The Town” to get psyched up it’s clear Boehner and Obama are dealing with the an alternate reality on the Right.
Avoiding financial downgrade is now Pres. Obama’s biggest problem. To become the first president in history to preside over a financial downgrade of the U.S. AAA rating is not going to help Obama’s 2012 marketing or his already sliding support on his handling of the economy. Frantic to avoid this calamity, it’s all hands working behind the scenes:
In a recent interview with POLITICO, David T. Beers, head of sovereign ratings at S&P, said the July 14th report was not a major shift and simply reflected an increased concern that there is no clear path to significant deficit reduction.
“What we are focused on is not the debt ceiling but the underlying state of public finances,” said Beers, a London-based executive who has conducted multiple meetings with administration officials.
In order to maintain a triple-A rating, Beers said, “what would have to emerge would be something that has a material impact on the underlying fiscal issues.”
“None of us know what this agreement is going to look like,” Beers said. “For us to think it is credible it would first of all have to show some choices about what the fiscal priorities are and be actionable in ways that would give us confidence that it is going to be implemented.”
Pres. Obama and the White House pushing aside a simple debt ceiling increase is now looking like a colossal error. Floating the “grand bargain” without getting support on the Democratic side comes close behind, because the furor behind the debt ceiling talks and the failed attempts at tying it to future deficit reduction has helped trigger wider doubts about the ability of Congress to come to any agreement at all.
This is the type of thing that could inspire S&P and rating agencies to lower the boom.
It’s just one reason why the Wall Street Journal is going to bat for Boehner, joined by the Chamber of Commerce, even if his plan “if enacted, it could well produce the greatest increase in poverty and hardship produced by any law in modern U.S. history,” according to the CPBB.
As the White House does all it can to avert a credit downgrade washing over Obama’s presidency, which would log the wrong kind of history for Democrats.
Establishment Republicans are freaked out over what the Tea Party is accomplishing at their expense, which is rendering everyone powerless to manage what used to be an easy bet.
House Majority Whip Kevin McCarthy (R-Calif.), the party’s vote counter, began his talk by showing a clip from the movie, “The Town”, trying to forge a sense of unity among the independent-minded caucus. […] After showing the clip, Rep. Allen West (R-Fla.), one of the most outspoken critics of leadership among the 87 freshmen, stood up to speak, according to GOP aides.
“I’m ready to drive the car,” West replied, surprising many Republicans by giving his full -throated support for the plan.
However, a leading conservative lawmaker, Rep. Jim Jordan (R-Ohio), said enough Republicans appear to oppose Boehner’s plan that it would not be able to pass the House on GOP support alone.