Sunday, September 15, 2013

Will Congressional Republicans shut down the US government or blow up the economy?

A third possible alternative might be, or neither?  But right now, one of the first two alternatives looks more likely.

As I noted yesterday, there is a very strong possibility that the near future the Congressional Republicans, not content with doing everything they can to sabotage the painfully slow recovery from the economic crash of 2008, will once again threaten to send the US government into default and disrupt the world economy by using a manufactured crisis over the debt ceiling for purposes of crude and irresponsible political extortion.  Some analysts are predicting that this time around the Republican leadership will find a way to avoid a destructive full-scale crisis—not because it would be harmful to the country, but because they worry that it might be politically damaging to the Republican Party.  But as I also noted, there are good reasons to worry that those predictions will turn out to be wishful thinking.

On Thursday Jonathan Chait explained some of those reasons (and there are more) in a clear and pretty convincing way.  It's worth reading his whole piece, but most of it is below.  We'll see what actually happens soon ...

—Jeff Weintraub

New York Magazine
September 12, 2013
House Republican Anarchy Update

The House was scheduled to vote yesterday on a continuing resolution, which is a measure to not shut down the government. Ultraconservatives have been demanding that the House refuse to continue funding the government unless President Obama agrees to defund Obamacare. House leaders have pleaded that this approach is doomed. Instead they came up with a plan to keep the government open, attached to a separate bill defunding Obamacare. Or, as Senator Mike Lee succinctly and correctly explains, “It is not a plan to defund Obamacare — it’s a plan to facilitate the passage of a CR [continuing resolution] in a way that allows people to claim that they’re defunding Obamacare without actually doing so.”

But some ultraconservatives still want to go with the defund-Obamacare-or-shut-down-the-government plan, as opposed to the pretend-to-defund-Obamacare-or-shut-down-the-government plan. It only takes about seventeen of them to defect to dent the Republicans majority, which gives a tiny fringe enormous power. What does the vote delay mean? Three things:

1. A government shutdown is more likely now. There’s just not much time available. A bill needs to pass by September 30, and Congress has a rigorous vacation schedule to adhere to, giving it precious little time to accomplish the goal of not shutting down the government.

Some House Republican leaders are trying to put on a brave face. One aide tells National Review’s Jonathan Strong, “Getting anything this big accomplished in 72 hours is always tough and we just need a couple extra days to dot the is and cross the ts.” (Note that the aide defines “anything this big” not as a major reform but as the simple continuation of government functions.)

More candid appraisals can be found elsewhere. When reporters asked John Boehner if he had any ideas to keep the government open, he replied, “Do you have an idea? They’ll just shoot it down anyway.” One aide privately seethed of the ultraconservatives, “They’re screwing us.” [....]  It’s not a confidence-building state of affairs. [....]
[JW:  Let's just observe in passing that when things have reached the point where people like John Boehner or Eric Cantor (or even Paul Ryan) start to look like the responsible adults and the voices of reason, the situation is already pretty disastrous.]
2. If the House plan does not pass, it could reduce the House’s bargaining leverage. As Jonathan Cohn and Brian Beutler have pointed out, the real goal of the House Republicans is to win the fight over government spending. Their plan to “continue” government spending would lock in sequestration cuts on the domestic side, while easing the cuts on defense. That would reduce the pressure on conservatives to — ultimately? Someday? — compromise on the budget.

Because they’re structuring their spending plan this way, and writing a bill to shift spending levels their way rather than just keep the government going, the House is foregoing any Democratic support. Therefore, they need all the Republicans on their side, which forces them to round up almost every last wingnut out there.

3. Debt-ceiling threats now appear more likely, too. One of the things the ultraconservatives are demanding, in addition to their plan to shut down the government over Obamacare, is that the leadership go along with a backup plan to default on the national debt over Obamacare. And the more House leaders have had to wrangle votes for its fake-Obamacare-defunding plan to not shut down the government, the more they’ve had to pledge to use the debt ceiling instead.

Of course, defaulting on the debt would be far more dangerous than shutting down the government. House leaders don’t want to do that, but they don’t seem to have any plan beyond getting past the next obstacle in front of their face. As Jake Sherman and John Bresnahan report, “In private discussions, GOP leadership aides acknowledge they have absolutely no idea how they’ll lift the $16.7 trillion debt ceiling.”

That part is actually easy — all they need to do is let all the Democrats and a few of the least-deranged Republicans vote to lift the debt ceiling. But doing that without provoking a coup against the leadership is hard.