Republicans plan to use the debt ceiling as a lever in budget negotiations this fall, according to John Boebner. The House Speaker set the bar in a press conference earlier today, demanding fresh cuts in federal spending as a trade for approving another hike in the debt ceiling:
Setting the stage for a fall showdown over raising the nation’s debt ceiling, House Speaker John Boehner, R-Ohio, renewed on Tuesday his insistence that “we’re not going to raise the debt ceiling without real cuts in spending. It’s as simple as that.”
As President Barack Obama readies a series of speeches later this week setting the parameters for this fall’s fight over government spending, the top House Republican said his position remained unchanged.
“I believe the so-called Boehner Rule is the right formula for getting that done,” he later added, referring to the eponymous rule matching new debt authority with spending cuts[.]
We’ve traveled this road a few times already, but so far the record is mixed. When Democrats had leverage with the expiration of the Bush-era tax rates, the debt ceiling became the only leverage Republicans had to force a deal. The deal on tax rates over the New Year holiday eliminated the Democratic advantage on budget fights, and they bet and lost that Republicans wouldn’t pull the trigger on the sequester, a deal they got by leveraging the debt ceiling in 2011.
However, does this really give Republicans much of an advantage? The reason why the debt ceiling could easily be decoupled from the budget is because there was no budget. The Democratic majority in the Senate refused to produce a regular-order budget for three years, which meant that spending was authorized in a series of stop-gap continuing resolutions and last-minute omnibus deals. The Senate finally got around to fulfilling its constitutional obligations in March of this year with its “Foundation for Growth” budget resolution on a 50-49 vote. (Red-state Democrats bailed on the plan.)
The proper process would be to have the House pass its own budget and then go to conference committee, with the debt ceiling raised high enough to cover the borrowing authorized by Congress in the budget. Furthermore, no one believes that Boehner will really allow a technical default or potential bond crisis to take place, especially with regular order restored; recall that “normal order” was the demand that Democrats reluctantly met in the spring on the last debt-ceiling threat. Boehner’s statement today sounds like a good PR play, but I doubt it’s the actual strategy on the ground in the House.
On the other hand, Senator Mike Lee threatens a less-dangerous government shutdown over ObamaCare — if it’s funded through continuing resolutions, that is:
“Congress, of course, has to pass a law to continue funding government. Lately, we’ve been doing that through a funding mechanism called a continuing resolution. If Republicans in both houses simply refuse to vote for any continuing resolution that contains further funding for further enforcement of Obamacare, we can stop it, we can stop the individual mandate from going into effect.”
Maybe Republicans will declare a belated victory on normal order and leave the Age of Cliffs to the past. No one will know the real answer for another six or seven weeks, but I wouldn’t bet on a big debt-ceiling fight.