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Debt Deal Back on Track and Why the Wheels Came off Yesterday

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Bloomberg and other news services are reporting that a “stop the default meteor from hitting the planet” deal is back on. According to sources on the Hill, the current outline a short-term deal in which the government stays open through January 15, and the authorization to borrow is pushed back till February 7 with a budget that supercedes the short-term deal due in by December 11.

So what happened yesterday, and more generally? As we’ve said, various whip counts based on public statements of Republicans members have shown that Boehner has had the 19+ Republican votes needed to join House Democrats to pass a clean continuing resolution, which also meant he’d also have enough votes to pass a clean bill to lift the debt ceiling. Obama has been insistent that he would not make policy concessions based on the use of the debt ceiling or shutdown threat, that it makes it impossible to govern. The Democrats wanted a December budget because a new round of spending cuts kicks in under the sequester on January 15 and they want a budget wrapped up before then.

And the Republicans have lost big from the shutdown and they know it, even if the Tea Party faction is trying to tell itself otherwise.

So why did everything blow up yesterday? The short form is the Senate was working on passing a deal. The House Republican caucus knew that if a bill passed the Senate with 70 or so votes, it would be pretty much impossible for the House not to pass it. So Boehner tried to gain control of the dynamic by passing a bill in the House first so as to get something a little more Republican-favorable than the Senate bill to the Senate to put them on the back foot. But he couldn’t do it. He tried first moving terms to the right and to the left and various Republican factions balked along with some Democrats.

So as of now, things look to be on track, with the goal of getting a deal inked today or at worst early tomorrow.

But, but, but….what about the Tea Party? Well, the Republicans who vote to support the debt ceiling increase in so-called “deep red” districts know that they might have to deal with a challenge from the right. But the rest of the party knows they’ve been damaged by this adventurism. And public opinion is much more sensitive to propaganda than most people want to admit to themselves. I saw it directly when I compared public sentiment about the war in Iraq in the US versus in Australia in early 2003. The tone and placement of the stories could not have been more different, and it was reflected in polling results (even though Australian PM John Howard joined the “coalition of the willing,” polls were 94% against the war on the eve of the US invasion, which is as close to unanimity as you ever see in polling). There are examples (for instance, in Serbia) where a 180 degree change in public reporting produced a massive shift in poll results in six weeks. Fox News is very powerful with Republican voters, both mainstream and Tea Party. If Fox starts moderating its tone, that will be a sign that powerful advertisers have decided the Tea Party needs to be leashed and collared. We’ll see if that happens in the coming weeks and months.

Another point a DC sources made is the ugliness of this fight is the result of the elimination of earmarks, which is the way members would get funds committed for spending in their district, like repairing bridges or funding foreclosure relief. Even though it’s become conventional to deride earmarks as pork, the job of Congress is to approve spending, and the job of individual Congressmen is to do things that are good for their district. Even though ending earmarks was depicted by liberal reformers as a way to end pork, it’s actually anti-democratic. Democracy is a messy tug-of-war over what our collective priorities should be and how they should be implemented and funded. Earmarks were a way of getting district-level needs into the mix. Without them, it’s harder for Congressmen to tell voters what they’ve done for them lately, and that thus winds up serving the narrative that the Federal government is just an apparatus that takes money from people and doesn’t deliver enough in the way of benefits.

But the other issue is that even though it now looks as if we will have a short-term deal sooner rather than later, we’ve also just been through a process that has left a lot of bad feelings on almost all sides. This is going to make meeting that December budget deadline a difficult task. Stay tuned.

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105 comments

  1. Lambert Strether

    Senate Reaches Bipartisan Fiscal Deal Times

    Super. Bipartisan, eh? Put your hand on your wallet.

    Reid, McConnell propose bipartisan Senate bill to end shutdown, extend borrowing WaPo

    Of course, as Yves points out, the principals are Obama and the House Republicans, and the Senate negotiators are only agents.

    NOTE Passing thought: Wouldn’t be great of everybody was saying “Pelosi can’t control her caucus!” and it was the Progressive Caucus that was causing all the trouble? Never in a million years, of course, but a man can dream….

    UPDATE Senate Leaders’ Agreement Extends Debt Limit to Feb. 7 but House Fate Murky ABC

    Senate leaders announce tentative budget deal FOX

    UPDATE Boehner to allow vote on Senate deal

    “The Speaker will bring that bill to the House floor,” Rep. Kevin Brady (R-Texas) told Bloomberg television Wednesday morning.

    It’s unclear whether the House or Senate will vote first on the agreement. …

    “No decision has been made about how or when a potential Senate agreement could be voted on in the House,” said Michael Steel, a spokesman for Boehner.

    UPDATE And the Grand Bargain enters, right on cue. House GOP: Grand Bargain Idea Still Alive WSJ:

    But House Republicans said Tuesday evening that the idea of a broad budget negotiation is alive and well, even as they struggled to pull together the votes needed to pass a measure. They hope to use new spending and debt-ceiling deadlines — if and when they are agreed to — to force broader concessions from Democrats in a budget conference, particularly on entitlement spending and the tax system. The bill extends government appropriations until Dec. 15, and the government’s borrowing ability until Feb. 7.

    “We plan to use those dates to enforce some type of budget agreement,” Rep. Devin Nunes (R., Calif.) said in an interview. “Folks know now that if anything we’re pretty serious about this….We definitely need to take on the entitlements and tax reform.”

    Lawmakers plan to use a long-discussed budget conference with the Senate as the setting to negotiate a broader deal, but decided they didn’t need special language in the extension bill to do it.

    Huzzah!

    UPDATE Senators announce deal to end government shutdown – live Guardian live blog, excellent as usual:

    Here’s a summary of the deal announced on the Senate floor. The bill would:

    • Reopen government and fund it through 15 January 2014.

    • Push the debt ceiling deadline back to 7 February 2014 (but NOT abolish “emergency measures” the Treasury could use to protect against default past that date).

    • Appoint members of a budget conference committee to join the House in trying to pass a budget and end the cycle of standoffs.

    • Institute an anti-fraud provision in Obamacare requiring government to confirm financial need of the recipients of health subsidies.

    Bullet 3 is the machinery for a Grand Bargain.

    Bullet 4 shows the Republicans actually got something (!). Another late requirement for an already dysfunctional project to deliver. I’m not sure the Federal Data Hub can determine income, let alone fraud. And it will also be interesting to see if the integration of credit reporting agencies becomes even more onerous than it currently is (which both parties would be happy with, of course, because rents, and because cleaning credit reporting data on the public dime under threat of the mandate is a delicious sweetener).

    Alright, I’m off to the hardware store to do something useful like buying insulation. Winter is coming.

    UPDATE Except adding:

    Yep. Let’s not identify party triumphalism with outcomes in the public interest, mkay?

    1. Jerome Armstrong

      It’s a bit early to say who wins and loses here. Sure, the tribalist D’s are going to claim a victory. And that’s what the media will repeat. But, I’d wait to see how the House votes.

      If the Conservatives vote No en bloc, and the Democrats are the ones that whip the votes to pass. Let’s say it gets down to less than 40 Republicans, that vote for this. That’s a pretty big win for the Tea Party activists, as they not only have the majority, they also know who to primary.

      I don’t really follow the ins and outs… I’m sure some egos are going to be pumped and others aired out. Just looking at the big picture here before the same thing happens again a few months later.

      1. James Levy

        Not many people around here I imagine like it, or like admitting it, but Obama hung tough, didn’t flinch, and seems to have won this round hands down. If he were anything but a black man, I think that millions in the middle range of American politics would respect and admire him for sticking to his guns and pushing back against the bullies. However since he is a black man, I wonder how many people will see this as “gutsy” and how many as “uppity.” Americans tend to like a tough guy, but will they rally around a tough black guy who just humiliated a bunch of white guys?

        1. Brooklin Bridge

          In broad measure, yes. Generally, those people who are not aware that step two is going to be an Obama orchestrated consummation of an already in progress Great Betrayal of the soul of the Democratic party, that is, those who thought Obama was looking out for their interests, will give Obama credit for standing firm. Who knows exactly what percent of the overall population, but I would bet between 40 and 50 percent. There will always be a few who wonder why he isn’t stretching drum skins in Kenya, but those are geographically more dense in the south and even there represent a minority – a vociferous minority yes, but still a minority.

          1. Paul Niemi

            Are there the votes in the Senate for a “great betrayal”, cutting Social Security and Medicare? No, I doubt it, and not on the eve of or in an election year especially. If anything, the conference committee might find a way to get rid of the sequester, which they all hate in private, if not in public. As for the President, the appellation “No-blink Obama” has a nice ring to it I think.

          2. Doug Terpstra

            Prescient as ever. It’s a longer chess game, but clearly market insiders had this one nailed, almost correographed.

        2. Jane Doe

          This is an incorrect statement of what has been argued.

          No one questioned whether he could hang tough. In fact, the opposite is true. Most have stated that his past claims of weakness were feigned.

          Now, the question is, what did he hang tough to accomplish?

          1. James Levy

            If you are referring to me, please say so, and point out where I accused you or anyone here of being a racist. I was talking about the general middle of the American political spectrum, which likes a tough guy at the helm. If you don’t think that being a tough black guy is different from being a tough white guy in the public imagination, then you live in a different America from the one I’ve lived in the last 48 years.

            As for Obama, I don’t like him, or his policies, or the people who mindlessly defend him. That does not change the fact that people in this country hate his guts and call him names because he is of mixed race and is perceived by them as being black. You can point out anyplace on this site or anywhere else where I have functioned as an Obamabot or argued that the ACA or his Grand Betrayal is a swell idea. Good luck finding evidence for your snark.

            1. Doug Terpstra

              It looks like you’re describing a racial dynamic, not endorsing it. I think race is a huge factor, maybe the critical determining factor, in the unlimited passes O’s enjoyed without scrutiny, and in the unfailing defense of media lights like Melissa Harris-Perry (MSDNC), who uses race as a club, and of the formerly progressive black caucus, who seem still catatonically mesmerized by having a black Pharaoh in the palace.

            2. s spade

              I continue to believe that if BHO had been all white instead of half white, nobody would ever have heard of him. He wouldn’t have made the Harvard Law Review, he wouldn’t have been the keynote speaker at the ’04 convention, he wouldn’t have become a Senator or a Congressman or even a ‘community activist’ serving the interest of big money Chicago real estate speculators.

              Don’t confuse him with Derek Jeter, who accumulated 3,000 hits even if most of them were singles. BHO is just a blowhard politician looking forward to a patrician retirement on the corporate dole.

        1. Jerome Armstrong

          Good to see you over here.

          Am sticking around tonight to watch the vote count in the House– will be interesting to see how many Republicans stick their neck out and dare the populists on the right to primary them next year.

          Am just guessing that the House has already swung, and there are a majority of Republicans voting against it.

    2. sue

      Unanimity of vote-polling;

      Senator Murray of Washington State told me personally that over 98% of all phone calls, e-mails, letters to her in regard to authorizing bushcheney war crimes=invasion of Iraq were solidly against allowing war powers to neocons.

      I further asked reason her colleagues voted to allow war powers-she replied they were LIED to-and, they believed if bushcheney were lying, voters would hold them and republicans accountable-elected representatives didn’t wish to place their asses on the line.

      It is quite simply irrefutable that the American public did not “go along” with bushcheney war crimes.

  2. Mac

    Maybe the teabag folks will go back to their caves or where ever they stay and let more rational folks deal with issues.

        1. NotTimothyGeithner

          One minor quibble. This poll is about self described “liberal Democrats.” This is a loaded term.

          Given the state of the Democratic Party, liberals leave every day. People who don’t leave would inevitably become more and more deranged on average.

          1. Cassiodorus

            They do? I’d like to believe that liberals leave the Democratic Party every day, though I’m guessing that the numbers are very low. Got any hard evidence in that regard?

        2. NotTimothyGeithner

          The poll in question asks self-described “liberal Democrats.”

          I wouldn’t say its necessarily say its liberal hypocrisy as much as team blue tribalists trying to separate themselves from the red tribe by adding the word liberal.

          1. Cassiodorus

            Is there really anything more to the term “liberal,” anymore, besides that it describes a species of Democratic Party tribalist with maybe a bit of cultural permissiveness that doesn’t want to admit that the Golden Age of Capitalism (and thus the currency of liberalism as a political movement) died forty years ago?

            1. James Levy

              Well, I think “liberals” themselves want to redefine the word so as not to appear an insignificant minority.

              We all know that if Obama was a true “liberal” (forget about being a socialist) he’d have been for single payer, against the farcical Afghanistan “surge”, against torture, rendition, and drone killings, against the NSA surveillance state, and for press freedom and massive cuts in military spending. Unfortunately, I don’t think that litany describes the beliefs of more than 10%-15% of the population, max. People like to make fun of the Tea Party as this goofy minority movement that has outsized power, but I’d wager that more people subscribe to the Tea Party belief system than support the positions I listed above.

              Most Americans seem to me to have a muddled, amoral, and unsystematic set of beliefs. This muddle is lauded by the press and too many academics as being “pragmatic”, but it is really just inchoate and confused. And most of those beliefs are not those of die-hard liberals or people, like myself, who self-identify as being on the Left.

                1. James Levy

                  On that data point you may be correct, but on the more coherent set of ideas that I enumerated, I think you are wrong. Plenty of “liberals” in New York (where I come from) may like the idea of single payer, but they’ll march into the voting booths and pull the lever for an authoritarian putz like Bloomberg who promises to “keep them safe” and won’t go into the streets when their black and Muslim neighbors are being stopped on the street for no reason or spied on and set up by agent provacatuers. I’m talking about liberalism as a coherent worldview, a set of principles you stand up for. People who would actively stand up for those principles are, I’d guess, in the 10% of the population range, while Tea Party types easily number 20% of the people, and they are more committed and militant than the liberals, for sure.

                  1. Cassiodorus

                    Two problems:

                    1) “Liberalism” as such isn’t a “coherent world view.” It’s kind of a mix of nice feelings with a nostalgia for the Golden Age of Capitalism and a desire to keep up appearances becaus rich people who vote Republican look nasty.

                    2) Voting records are no measure of liberalism. Liberals vote for people who are decidedly right-wing stuckups — see e.g. John Kerry:

                    http://www.counterpunch.org/2004/11/06/lessons-they-won-t-learn-from-november-2-a-word-from-nader-a-last-look-at-kerry-and-michael-moore/

                  2. s spade

                    I think you confuse ‘liberal’ with ‘progressive’. It seems to me that ‘liberal’ is a term of opprobrium invented by that Foxist twit, Ann Coulter.

              1. Lambert Strether

                Polls generally show the number of people who reject ObamaCare as not liberal enough as around 11%. Given that people like that get no press, and the TP gets both a ton of press and a ton of money, I’d put “grass roots” support for “truly liberal” as about the same as “grass roots” support for the TP.

      1. jane doe

        Its been interesting to watch two elites (Neoliberals v Reactionaries), and, at the same time, watch so many Democratic base partisans imagine that they are watching something other than two rabid dogs fighting over which one gets to bite us and how.

        1. Doug Terpstra

          Well put, though rabid dogs aren’t quite as deadly or sadistic as their political analogs or their handlers.

      2. sue

        Lambert is accurate-Obama has continued bushcheney war crimes; in fact, furthered surveillance and attacks upon whistleblowers quite beyond bushcheney brazenness.

        Problem for Obama is his “professional left”, whom he castigates, is knowledgeable enough to call out his war crimes-Constitutional destructions, as clearly as bushcheney’s.

    1. scraping_by

      As long as we have Stalinist vote-counting in this country, whether Diebold or good old fashioned ballot tossing, we’ll have TB.

      The flip side is that when and if the law enforcement quits framing Muslims and shooting their way into people’s houses, the TB will be endangered.

  3. joanneleon

    So now the Bicameral Catfood Committee has a deadline, Dec. 11.

    Nothing has changed except the whole world is convinced that the hardline Republicans are crazy and willing to do real damage. It makes it easier for the Dems to say TINA, we have to give them what they want, to some extent, or they’ll do all of this all over again.

    I’m not clear on the December 11 deadline. What happens between 12/11 and 1/15 and what’s the incentive for finishing the budget then? Will they hold votes?

    1. Richard Lyon

      The can has been kicked down the road a little piece of the way. That is all that has happened.

      1. Lambert Strether

        Please don’t even use the “kick the can” metaphor. There’s an even more loathesome than usual Pete Peterson-funded Astroturf organization that’s actually going to have fresh-faced, smiling young people carting totally genuine and yet camera-ready tin cans to the Hill. I hope these kids make sure they’re not carrying catfood tin cans, though, because that would be bad, although, to be fair, one could substitute dry food that comes in bag under Chained CPI.

        1. craazyboy

          Chained CPI theoretically covers grubs and other juicy bugs,too, once they get priced at the farmer’s market so the stat dudes and dudesses at the BLS have some numbers to work with.

          But they won’t cut the Medicare Part D brand name drugs, so it all evens out.

        2. Richard Lyon

          I’m not really sure what you are referring to. My reference is to the children’s game of endlessly kicking a can down the road without any other objective in sight. That reference is frequently used to describe the effort of various political systems to avoid the risk of having to make a decision and take action. It has nothing to do with any particular type of can. I really don’t understand why you would find the reference objectionable.

          1. Brooklin Bridge

            They were not critical of your usage; just having a little dark humor fun with the metaphor.

              1. Lambert Strether

                “Word police,” no. “Trope police,” yes.

                Such tropes are propagated by very well paid organizations with values and interests inimical to my (and I would hope) our. “Government is like a household” does immmense, corrosive, mind-rotting damage, for example, rather like “death tax,” “welfare queen,” and many hundreds of others.

                  1. enouf

                    “We need to …”

                    Count how many times a day you hear that catchall-start-phrase (Especially within the Corporate Media, but even outside of it).

                    Love

          2. savedbyirony

            They are referring to “The Can Kicks Back”, a P.P. contrived “populist” student movement to fix the debt. (It reminds me a little of the faux farmers driving tractors down Washington DC streets in support of repealing the estate tax back during Bush II.)

  4. Sleeper

    Thanks for pointing out the effect of removing the “earmark” system. Too many folks have missed this important point.

    Would it be possible to illustrate the power that the Congress (House) has in setting tax policy ?

    We often hear of the “Bush tax cuts” or the “Obama payroll tax holiday” but the reality is that the Congress has always had the power of the purse and jealosly guards that power. – It is possible to read about the financing struggles that some prominent commanders had in prefederal times.
    It used to be that every school child knew the phrase – The President proposes – the Congress disposes.

    A large part of the issue of tax policy is that Congressmen routinely sell tax breaks in return for contributions. This is why the tax code is so long and convoluted.

        1. Jim Haygood

          Negotiations are even harder, when neither party has a penny to their name, other than what they can print, borrow or steal at gunpoint in coming days.

          I love to visit the Potomac tar pits in the autumn, where one can hear the trumpeting of the dying RINOs, as they prepare to submit to nature’s exacting, eons-long process of converting them into something more useful: PETROLEUM.

          Happy motoring, comrades!

        2. NotTimothyGeithner

          They want the other side to take credit for the disaster except Obama who thinks cutting Social Security will make him a great man.

          No one wants to be the guy who voted for it or more specifically the 51st or 218th vote. This is the one advantage the sane have against Washington.

          For example, Mark Warner (D-VA) has an approval rating down at 51% earlier this Summer. He ended his time as Governor with an approval rating of 71% in January 2006. Virginia has off year elections.

          Warner has virtually no record besides devotion to corporate interests to run on. Right now, he is safe, but what happens when a guy who is running on his time as Governor, three Governors go next year makes the wrong noises on Social Security or can’t deliver the Federal Defense Contracts to Northern Virginia as the other Senators and Congressman start to demand those contracts be moved to their districts.

          A year ago, he would have been a safe vote to kill Social Security, but I’m not certain anymore. He’s not in it for money. He’s in the Senate for the adulation.

          1. cwaltz

            I’m sure the 1% have a sufficiently insane Republican to run against him. Here in Virginia it appears our options are always batshit insane and corporate hack out to annihilate anything that doesn’t benefit the 1%. :/

            1. Jerome Armstrong

              Man, you said it. That’s sleazeball McAuliffe and Cuccinelli. I will vote for the 3rd party Libertarian for Sarvis– who seems like a pretty nice guy. No chance to win, might get 10%

            2. NotTimothyGeithner

              Fear works for only so long. Remember Taliban Bob? What happened to him? A crummy, conservative candidate who waits for a Republican to self-destruct won’t work more than once. The GOP is a party driven by fear, but the Democrats have actual optimists in their voting bloc who are not driven by fear. The people who do GOTV don’t do that because they are motivated by fear. The white kid who registers voters in poorer neighborhoods isn’t there because of fear.

              If he touches SS watch him plunge.

  5. Lambert Strether

    Note that the sequester budget levels are already horrible and causing a lot of suffering. So we really have the best of all possible worlds, don’t we?

    1) Democratic and especially Obot triumphalism while

    2) Kicking the workers, the poors, and the olds.

    What’s not to like?!

    * * *

    The prize is policy, so keep your eyes on that…

      1. Brooklin Bridge

        Great line! I’m going to set that on paper with caligraphy and thumb tack it to my door – with due credit given to “Cassidorus”.

    1. optimader

      Of the potential collateral damage flowing from this debacle, Congressional staffers are pretty damn far down the list.

  6. Bridget

    If the point of this whole exercise was to drive a stake into Obamacare, the Republicans likely got a better deal than they realize at this point. The administration, although clearly in denial about their level of preparedness for the rollout, nevertheless was concerned enough about income verification to try to circumvent it. I’m thinking they know something we don ‘t, and that there are some more nasty surprises in store for prospective Obamacare consumers.

    1. Doug Terpstra

      Right. I’m betting ObamneyCare devolves into a historic disaster, and Obama earns his distinguishing legacy as the worst POTUS in history.

      But the crisis was never really about ACA, though empowering the credit bureaus as gatekeepers is a nice perverse twist, n’est pas? Both parties want the insurance-Pharma bailout. It was always merely a diversion for the main event, the Soylent Green stimulus package.

  7. Ed S.

    Yves (and Lambert),
    Conventional wisdom is that the R’s lost and lost big – but I’m not so sure. I speculate that what we’re seeing is the fracturing of the R’s into two very distinct groups (and what may end up being the end of the Republican party as constituted for the last 6 decades) – “traditional” R’s like Mitt Romney and John Boenher and TP R’s . The TP wing of the R’s didn’t accomplish its purported goal (defunding ACA, like that was ever going to happen) but it was able to flex its muscles by shutting down the government (now into the 3rd week) and bringing the government to the brink of technical default.

    I reviewed the 2012 House results to determine how many races were “competitive” – I define “competitive” as a vote percentage spread of five (5) percentage points or fewer (e.g., R-52%, D-48%). Out of 435 races, only 36 races were “competitive” (including 2 odd results from NV). California has 53 seats and had 3 competitive races; Texas was 36 and 1; NY was 27 and 5. Typical percentage point spreads were 10 to 30 points. (62 to 38 was a typical race – I can post the full list if you want). In the House, the race is in the primary; the country is now divided into R districts and D districts.

    The R’s, as constituted today, may be done w/r/t winning the Presidency, and may have an uphill battle in the Senate. Don’t underestimate that the “moderate” R’s may be in for a challenge from the TP right in many districts.(and a strong one at that – remember “we lost ’cause Romney wasn’t conservative enough?”) A scary question: is there a more powerful “caucus” in the House right now than the TP? What if they have 80, 90, or more aligned Reps?

    Boehner is a dead man walking.

    1. Cassiodorus

      The Republicans could win the Presidency, depending upon how thoroughly the Democrats discredit themselves in the next three years. Remember that “lesser of two evils” voting is in the saddle, and people are voting in droves against candidates rather than for them.

    2. Jerome Armstrong

      Good post Ed. That’s what we are going to find out with this vote today. My hunch is that it’s a lot higher than 80-90, and well into the 100′s, a majority.

      The Republican voters are so far ahead of the Democratic ones, in going after them in primaries. I used to think it was just a matter of organizing and awareness. But the attitudinal polling I looked at with with the super pac CPA revealed authoritarian impulses among Democratic primary voters that inhibit the strategy– not so among the majority of GOP primary voters.

      1. NotTimothyGeithner

        One of the issues with the breakdown of authoritarians in both parties is the GOP is an alliance between the old style Bob Taft elite and the Dixiecrats and nativists after they left the Democratic Party with Nixon’s Southern strategy.

        The GOP base will primary the Republicans who aren’t good enough because the GOP base understands on some level that they aren’t Republicans. They use to be Democrats, or many of them anyway because there are the country club Republicans, libertarians, neo-cons and tribal Republicans.

        They may blindly follow certain leaders, but I think there is an understanding of an us and them within the GOP alliance which doesn’t exist among Democrats, partially because the various “special interest” groups have legitimate grievances and the Democrats do a gone job at feigning how outmatched they are by the dastardly clever Republicans who are also morons at the same time.

        1. James Levy

          Were are people on the Left who want to primary Democrats going to find donors with bags of money the way Tea Party insurgents can?

          And, the Democrats have a hidden issue that keeps the insurgents at bay: Israel. Most people who are truly on the Left are really dubious about the actions of the Israelis, and if your mainstream Democrat can yell “anti-Semite!!!” at you, you are through, not only politically but professionally. Notice how even a liberal standard-bearer like my Senator Warren makes sure to bow and scrape in that direction. You’d have to have money, tons of time to explain your positions (people don’t hear Left positions in the Mainstream Media) and avoid both red-baiting and cries of anti-Semitism to win. Good luck with that.

          1. Jerome Armstrong

            Waxman and CA 33rd has that sort of potential ‘Democratic run-off’ dynamic in the GE ’14.

      1. Doug Terpstra

        The RP could be on life support in intensive care, and Obama would do mouth-to-mouth before the midterms to be sure he had a robust enough opposition to capitulate to. Let’s not forget how cleverly he conceded Ted Kennedy’s seat in 2010 and snatched defeat from the jaws of victory in the house. It was a breathtaking performance.

    3. optimader

      Boehner is a dead man walking.

      Boehner will be a overly remunerated government pensioner asshat.

  8. diptherio

    Amy Goodman interviewing Amanda Terkel on “essential” government services on Democracy Now! today:

    Goodman: What about daycare for Congress members? Meaning their children, of course.

    FTW!

  9. Malmo

    Kabuki Act 3 just about over. Can’t wait to see all the Democrats self congratulating themselves. It will be short lived, though. Once the uninsured get a taste of Obamacare (read : exorbitant costs to them) you can bet the farm there will be more than the usual off year benefit to Republicansin 2014. If Obamacare isn’t altered drastically before the net presidential election there will be no Hillary in 17 either.

  10. Hugh

    The last two weeks have provided nonstop examples of why no one should ever vote for a Republican or Democrat again. The current crisis was manufactured as much by Democrats as Republicans. The Tea Party Republicans, the “regular” House Republicans could have ended this at any time, just as Obama by the exercise of his Constitutional and statutory powers could have ended it as well.

    What this was was factional infighting among our kleptocratic elites. Both sides fully intend to loot us. They just have different agendas concerning how to go about it. Gutting Social Security is the Holy Grail for Obama, and as I have said in the past, Obama has never and will never give up on such an anti-progressive, anti-99% prize. And he will manufacture and seek to exploit every one of these Shock Doctrine moments until he gets his way.

    So again, never vote for a Democrat or Republican again.

    1. Jill

      I must agree. Why are we electing people whose mode of governance is, CRISIS!? If Obama and other Republicans are saying they couldn’t see this coming, does this mean they really are stupid? If so, why are we voting for stupid?

      Clearly, most everyone in Congress and Obama, saw this coming and knows it will be coming again. They did absolutly nothing to stop it. They also did not take the time to work out a real budget of any kind.

      These people’s agenda is clear. Since 9/11 this has been governance by crisis be it regarding the financial realm or the police state. By this method they strip our society of every good.

      1. sufferinsuccotash, stupor mundi

        In my more cynical moments I tend to think that it’s not government by crisis so much as government by fundraiser.
        As soon as a “crisis” is thoroughly milked for more campaign dollars it somehow gets called off.
        Funny how these things happen…

    2. Ed S.

      What this was was factional infighting among our kleptocratic elites

      Maybe.

      What’s not in dispute is that the TP started out of general frustration with elected officials (I think you can trace the lineage straight back to the bank bailouts in 2008), was quickly co-opted by a group of the 0.001% to try to drive an “uber wealthy” agenda.

      What may be in dispute — is the group that initially funded and controlled the TP still in control? Have they unintentionally created a “doomsday” machine” that they can’t turn off? The TP “platform” is a dog’s breakfast of conflicting priorities (Lower Taxes! More Military Spending!) but many points, if not most, resonate at a superficial level in the minds of a substantial minority of the electorate. Many are “true believers” and think they are persecuted – which is reinforced by the casually smug contempt with which they are portrayed in the media.

      I speculate as to the degree that the TP isn’t playing the role that the Wahabi’s play in Saudi Arabia – initially given some power to help the House of Saud but now utterly out of control of the House of Saud (or Germany, 1925 – but I’m not going to Godwin the discussion). The greatest danger is not taking them seriously.

      1. Fiver

        The “House of Saud” has been funding, arming and directing “jihadist” networks throughout the region after laying low post-9/11. Witness key roles of “Al Qaeda affiliated” groups in Libya, Syria, Iraq and elsewhere openly funded and armed by the Saudis in league with the CIA. I’d put it more like:

        Just as this Admin uses “jihadists” to further its policy goals from North Africa through the Middle East to the Gulf, so they (or their money masters) use the TP in order to convince Americans the Admin is beseiged from a right so “crazy” that a set of very right-wing policies can be passed by a Democratic President and Senate with respect to SS, Medicare, taxes etc.

      2. s spade

        ‘many are true believers and believe they are persecuted’

        What is interesting is the political silence of those over 65, who are being impoverished ZIRP while never making a peep about it.

        I suppose most of them are now rushing into the stock market. They should be all in just in time for the next crash.

  11. Fiver

    Another triple-digit day on the Dow – wonder whose text, tweet, or other signal reached his/her/its HFT servers first?

    Obama once again (starting in Jan 2009) stoops to lift Republicans up off the mat by agreeing to provide further opportunities for potential extortion using ‘market fears’ as the club, rather than leave the likes of Cruz on the hot seat and watch ‘em melt completely. It is a strange character indeed who has no qualms signing-off on thousands of murders, waging multiple wars including the one on whistleblowers and the press, or supporting unbridled spying and secret courts, yet cannot bring himself to use his power when it comes to dealing with a minority within the political opposition.

    CNN breathed a quick “sigh” of relief, and has been throwing the “can” word around ever since – and of course that’s the key question, i.e., “What has been resolved by this?”. I thought Obama, given the strength of his objective political position (never mind the Presidential powers he refuses to use) would settle for nothing less than a free debt ceiling until after 2014 elections minimum, an immediate government re-start, and the Budget discussions then normalized. Why keep the Tea Party in the game? Why save Boehner’s ass?

    Clearly, Obama (or whomever he answers to) must believe they’re still useful the way they’ve been useful to date, as a ball and chain pulling the entire political discussion as far right as possible; as a very handy tool for managing ‘markets’, in this case knocking all talk of bubbles off the radar even as further QE has found itself a ready-made context for extension; and as providers of a nice fat Q4/Xmas gift to corrupt insiders in Government and their buds on Wall Street with both big directional ramps as well as trading fees.

    So was the opportunity to split the Republican Party in two, then passing a “Democratic” budget worth trading away for those ‘goodies’? Apparently. Obama had ‘em by the short ones, and let ‘em go again. Just like classic cartoons.

    When Obama said he wanted to be a ‘transformational’ President he wasn’t just a kiddin’. It’s Saturday morning every day of the week.

    1. Doug Terpstra

      You shine a bright light on the great O’s spider web. It sure is tangled and very sticky. He may find himself hung in it … one can hope.

  12. Lafayette

    Given the dire impact economically upon the country of not expanding the debt level, I wondered if voting against such a measure was not tantamount to treason.

    Treason = The crime of betraying one’s government.

    Just a thought …

    1. Brooklin Bridge

      In a Democracy, treason would be the crime of betraying one’s country or nation (not one’s government). In an aristocracy, it would be the crime of betraying one’s sovereign. In our country, it is the crime of betraying Obama.

      1. lucky

        Hmm, I thought treason was supporting Obama. At least that’s what the pair manning the “impeach Obama” stand in front of the bank tell me.

  13. skippy

    Well the Government is now running like any public – private enterprise… cough… Obama care (cooperate logo with prez name – ewwww)… looterific!

    skippy… not to worry tho… Rumor Control has it the Diebold voting machines will hooked straight up to the exchanges in 2016 and votes will be determined by pricing models… this has been a public service announcement from City 17…

    “Exile Vilify”

    http://www.youtube.com/watch?v=3ZhnGQXWi1U

  14. Brooklin Bridge

    Yves comment yesterday has now been activated!:

    We feel compelled to mention one matter: getting a debt ceiling/end the shutdown pact of some sort is merely a precursor to the hoped for performance of The Persecution and Assassination of What is Left of the American Middle Class, as Performed by the Inmates of the Beltway under the Direction of Barack Obama (more commonly described as the Grand Bargain or Great Betrayal).

    The track has been oiled; the condemned is breathing a happy astoundingly idiotic sigh of relief and putting his head back under the guillotine’s blade.

  15. cwaltz

    Only in crazy bizarre Democrat land would adopting the budget of the political adversary that lost to you last election cycle be considered a “victory.”

  16. Bapoy

    The democrats won their battle (to the detriment of the people they are “helping”), the Republicans think they won for putting up a fake fight that was obvious from the beginning. Everyone knew they would “cave” in at the 23rd hour, exactly what happened.

    Come the primaries, forget Tea Partiers, what you will get is Libertarians, tons of Libertarians. I sure hope the sleeping zombies begin to wake up before the election (not holding my breath).

    The Germans also kept support for Hitler until he was dead. The same applies here.

    1. James Levy

      And what are Libertarians going to promise us? More deregulated markets? More property rights fetishism and “drill, baby, drill”? More “fuck global climate change, I want my gas-guzzling monster truck!”? Fewer restrictions on the rich buying elections? Perhaps property qualifications for voting? Hell, since the right to vote is perceived as being worth something, why don’t we sell it? Along with the national parks and forests. I mean, who needs trees and oxygen, for Christ’s sake!

  17. Jerome Armstrong

    Seeing how Detroit won in a blowout, I followed the very tight Republican caucus vote:

    19 yes 11 against
    22 yes 27 against
    23 yes 31 against
    29 yes 41 against
    32 yes 52 against
    34 yes 61 against
    43 yes 77 against
    49 yes 90 against
    59 yes 102 against
    62 yes 111 against
    72 yes 122 against
    80 yes 134 against
    88 yes 142 against
    87 yes 143 against (someone changed their vote)
    87 yes 144 against

    Well, it started tight. Before the vote, it was assumed that a majority would stick with Boehner. This is a watershed moment in American politics. The populist right clearly has the momentum and is going to take over the Republican party within a couple of cycles.

  18. bob goodwin

    leashed and collared? Really?

    And advertisers make decisions about democracy? Really?

    The loyal opposition lost, that is no surprise. But it is still opposition, and still loyal, and still doing the messy business of democracy. If you leash and collar opposition, what is to stop the corporatist state?

    1. Yves Smith Post author

      With all due respect, you really need to read up on the role of TV in voting in the US. Fox News is hugely influential and in case you missed it, it is not “democracy,” it’s a business. And it might further behoove you in general to get a grip on the fact that politics in the US has been driven by money well before the Citizens United decision.

      Start with the book Golden Rule. Next reading for you is Alex Carey’s Taking the Risk Out of Democracy.

  19. Jerry

    I really hate reruns especially by such poor actors. The lady that was yelling was sharing a truth that we all recognize……it is not about the right or the left, conservative or liberal, it is all about which contributors the politicians want paid for the financial backing they provide to campaigns…that’s why the lady said you cannot serve two masters….either the public or the big money contributors. She called them on their pretending/acting …acting like they care about their electorate when all they really care about are their big buck contributors. The really stupid thing is they actually think they are fooling people when they are not. They look like such fools!

  20. clarence swinney

    A recent local article blamed President Obama for our horrid debt
    Debt incurred by President Obama
    % of GDP—Fiscal year (ends 9-30 of each year.)
    2009—10.0%–GW Bush last budget
    2010—8.4%
    2011—8.3%
    2012—7.0%
    2013.–4.0% (projected)
    Source: cbo.gov
    The major causes for our current 16.7B debt were two wars unfunded, two huge tax cuts, Part D Medicare unfunded, Obama 800B stimulus and payroll tax cut.
    Bush left a 11.9B Debt .a 6.1B increase on Clinton 5.8B.
    .Obama added 4.8 B increase over Bush 11.9B. A dollar record for four years.
    In fairness to Bush cbo predicted a 10,000B surplus in ten years so he felt the people could use the money. He did not predict 9-11-01. It was a mistake to get two wars. Part D was great for retirees.

  21. Punkyclown

    Okay, this is my last post here and my last visit. Seems that monetizing our site with ads from Banks is more important than your content. I’m sorry but putting Wells Fargo bank ads on your site and then railing against the banks doesn’t make any sense, your either with them or against them. I certainly can not be both and I don’t understand how you can. So I am outti, was a great site, just another corporate slave now. Bye, It’s really frustrating doesn’t allow you to just sent an email to make a separate comment.

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