Quotes of the day

A number of Republican senators say a partial government shutdown should be considered as an option if President Obama doesn’t concede on spending cuts to the GOP’s satisfaction…

Sen. Ted Cruz, R-Texas, told the Dallas Morning News that he would be open to a partial government shutdown, pointing to the 1995 shutdown as “the greatest degree of fiscal responsibility we have seen from Congress in modern times.”

Sen. Pat Toomey, R-Pa., Wednesday urged Republicans to consider a partial government shutdown, saying it would be “a hell of a lot better” than agreeing to a deal with no spending cuts.

“The president has made it very clear: He doesn’t even want to have a discussion about it, because he knows this is where we have leverage,” Toomey said on MSNBC Wednesday.

Over the next few months, we will reach deadlines related to the debt ceiling, the sequester and the continuing appropriations resolution that has funded federal operations since October. If history is any guide, President Obama won’t see fit to engage congressional Republicans until the 11th hour. In fact, he has already signaled an unwillingness to negotiate over the debt ceiling. This is unacceptable. The president should immediately put forward a plan that addresses these deadlines, and he should launch serious, transparent budget negotiations…

The coming deadlines will be the next flashpoints in our ongoing fight to bring fiscal sanity to Washington. It may be necessary to partially shut down the government in order to secure the long-term fiscal well being of our country, rather than plod along the path of Greece, Italy and Spain. President Obama needs to take note of this reality and put forward a plan to avoid it immediately.

Sen. Charles Schumer (D., N.Y.) is advising his congressional colleagues and President Barack Obama not to negotiate with Republicans if they threaten to shut down the federal government or vote down an increase in the borrowing limit.

“Anyone who wants to come and negotiate and say we will raise the debt ceiling only if you do A, B, C will not have a negotiating partner,” Mr. Schumer said at a press conference Friday. “And if then they don’t want to raise the debt ceiling, it’ll be on their shoulders. I would bet that they would not go forward with that.”

Senate Majority Leader Harry Reid (D-Nev.) has privately told other Democrats, including President Obama, that if the administration used its constitutional and executive authority to continue paying its debts in the face of House Republican opposition, he would support the approach, according to a source familiar with Reid’s message to the president.

The simplest escape route out of the debt ceiling impasse is for the president to direct the Treasury to find a legal way to pay its debts. The Treasury then has a variety of options. One gaining particular attention relies on a law that allows the Treasury to mint a coin of unspecified value and deposit it with the Federal Reserve. Those funds could then be used legally to pay debts.

“Reid has not dismissed any option,” said the source close to Reid.

The source relates some of Boehner’s comments:

“With the cliff behind us, the focus turns to spending. The president says he isn’t going to have a debate with us over the debt ceiling. He also says he’s not going to cut spending along with the debt limit hike.

“This morning we’re releasing the results of a survey by the Winston Group taken December 29-30 among 1,000 registered voters. Seventy-two percent of Americans agree any increase in the nation’s debt limit must be accompanied by spending cuts and reforms of a greater amount. That’s the principle I laid out before the Economic Club of New York in May of 2011, and I’ve repeated a number of times since. The debate is already underway.”

Via the Winston Group.

Republicans insist they’re on the right side of public opinion in this round, citing a CBS News poll last month that 68 percent of Americans don’t want the debt limit raised. After agreeing to $620 billion in tax revenue to avert the fiscal cliff, congressional Republican leaders claim they will accept nothing less than a dollar in cuts for every dollar increase in borrowing authority…

“Most Americans, if you ask them, want less debt, and it’s clear that Obama and the Democrats want more,” [Club for Growth President Chris] Chocola said. “If the Republicans can convincingly and confidently tell that story, I think that they can start to win the debate.”

“But they have to be willing to shoot the hostage,” he added. “They have to be willing to not raise the debt ceiling. I think Obama doesn’t believe we’ll do that and Republican leadership worries about what guys like you write. … They have to be willing to say, ‘We’re not going there unless we put meaningful reforms in place.’ The public at least on this one is kinda on their side.”

In a better, more rational world, the debt limit wouldn’t be a tool of budgetary policy. But it is one of the few must-pass pieces of legislation that Republicans can use to force spending cuts, and it obviously relates directly to our budget problem. If the president doesn’t want the debate over it to go nerve-wrackingly down to the wire, he can set out a serious offer, now.

Of course, he’s doing the opposite. His refusal to negotiate isn’t sustainable, but he’ll spend precious time trying to sustain it. He’ll finally agree to talk, and then get Republicans to back off whatever their maximal position is — because Republicans will again fear being blamed if there’s no agreement. Another Band-Aid will be applied to the debt, until next time. In the Age of Obama, the new budget crisis always follows the last.

The reason behind this lamentable outcome is the outsize influence of narrow interest groups—which marks a second, unhappy parallel with Europe. The inability of Europeans to rise above petty national concerns, whether over who pays for bail-outs or who controls bank supervision, has prevented them from making the big compromises necessary to secure the single currency’s future. America’s Democrats and Republicans have proved similarly incapable of reaching a grand bargain; both are far too driven by their parties’ extremists and too focused on winning concessions from the other side to work steadily together to secure the country’s fiscal future.

The third parallel is that politicians have failed to be honest with voters. Just as Chancellor Angela Merkel and President François Hollande have avoided coming clean to the Germans and the French about what it will take to save the single currency, so neither Mr Obama nor the Republican leaders have been brave enough to tell Americans what it will really take to fix the fiscal mess. Democrats pretend that no changes are necessary to Medicare (health care for the elderly) or Social Security (pensions). Republican solutions always involve unspecified spending cuts, and they regard any tax rise as socialism. Each side prefers to denounce the other, reinforcing the very polarisation that is preventing progress…

This week Mr Obama boasted that he had fulfilled his mandate by raising taxes on the rich. In fact, by failing once again to clear up America’s fundamental fiscal trouble, he and Republican leaders are building Brussels on the Potomac.

I worried the other day that amid all the rancor the president would poison his future relations with Congress, which in turn would poison the chances of progress in, say, immigration reform. But I doubt now he has any intention of working with them on big reforms, of battling out a compromise at a conference table, of having long walks and long talks and making offers that are serious, that won’t be changed overnight to something else. The president intends to consistently beat his opponents and leave them looking bad, or, failing that, to lose to them sometimes and then make them look bad. That’s how he does politics.

Why?

Here’s my conjecture: In part it’s because he seems to like the tension. He likes cliffs, which is why it’s always a cliff with him and never a deal. He likes the high-stakes, tottering air of crisis. Maybe it makes him feel his mastery and reminds him how cool he is, unrattled while he rattles others. He can take it. Can they?…

In the short term, Mr. Obama has won. The Republicans look bad. John Boehner looks bad, though to many in Washington he’s a sympathetic figure because they know how much he wanted a historic agreement on the great issue of his time. Some say he would have been happy to crown his career with it, and if that meant losing a job, well, a short-term loss is worth a long-term crown. Mr. Obama couldn’t even make a deal with a man like that, even when it would have made the president look good.

Republicans now have the default advantage. If the debt limit is not raised, Obama will be forced to cut federal spending by 44 percent. If the sequester is not rescinded, $1.2 trillion in spending cuts will go into effect. As the party of the welfare state, Democrats simply can not allow this to happen. Republicans are now in position to get the better side of the bargain. But what do they want?…

In other words, no, Republicans have no idea what they want to ask for in the upcoming debt limit debate. Yes, they want all the entitlement reforms in the Ryan budget, which are specific enough, but the Harry Reid Senate is never going to pass that budget and Obama would never sign it. So what, realistically, should Republicans insist on?

Former House Speaker Newt Gingrich said Friday that the upcoming showdown over the debt ceiling isn’t a political winner for House Republicans, dubbing it a “dead loser.”

“They’ve got to find, in the House, a totally new strategy,” Gingrich said on MSNBC’s “Morning Joe.” “Everybody’s now talking about, ‘Oh, here comes the debt ceiling.’ I think that’s, frankly, a dead loser. Because in the end you know it’s gonna happen. The whole national financial system is going to come in to Washington and on television and say: ‘Oh my God, this will be a gigantic heart attack, the entire economy of the world will collapse. You guys will be held responsible.’ And they’ll cave.”

There’s a term for societies where power brokers stitch up the people’s business in back rooms and their pseudo-parliaments sign off on it at 3 a.m., and it isn’t a “republic of limited government by citizen-representatives.”

There are arguments to be made in favor of small government: My comrades and I have done our best over the years, with results that, alas, in November were plain to see. There are arguments to be made in favor of big government: The Scandinavians make them rather well. But there is absolutely nothing to be said for what is now the standard operating procedure of the Brokest Nation in History: a government that spends without limit and makes no good-faith effort even to attempt to balance the books. That’s profoundly wicked. At a minimum, the opposition, to use a quaint term, should keep the people’s business out in the sunlight and not holed up in a seedy motel room with Joe Biden all night.

The fiscal cliff was a mirage. If Washington was obliged to use the same accounting procedures as your local hardware store, the real national debt would be at least ten times greater than the meaningless number they’re now going to spend the next two months arguing over. That’s to say, we’re already over the fiscal cliff but, like Wile E. Coyote, haven’t yet glanced down at our feet and seen there’s nothing holding us up. In a two-party system, there surely ought to be room for one party that still believes in solid ground.

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• Quotes of the day

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