Wednesday, July 27, 2011

Boehner Unveils New Debt Plan With Extra $65 Billion in Cuts

FROM: CNBC

U.S. House of Representatives Speaker John Boehner's office said Wednesday that its revised plan to raise the U.S. debt ceiling would deliver about $65 billion more in cuts over a 10-year period than an earlier version.

Boehner's office said its new plan would deliver $917 billion over 10 years, which meets its criteria that any debt-ceiling increase must be matched with a greater dollar figure in spending cuts. The plan would raise the debt ceiling by up to $900 billion.

Boehner is pushing the House for a vote Thursday for deficit-reduction legislation that his party hopes will emerge as the last best option for averting a debt default that could trigger economic calamity.

To get it passed, Boehner has to stare down rebellious Tea Party conservatives who feel the U.S. government has gotten too big and who under no circumstances want to raise the debt ceiling to permit more spending of borrowed money.

The politics are tricky because by getting elected last November on a wave of anti-government sentiment, the Tea Party activists helped propel Boehner into the House speakership, making him America's most powerful Republican.

This makes Boehner beholden to the Tea Party, but he also has to resist the take-no-prisoners approach they favor and actually get a workable option approved.

"Listen, it's time to do what is doable, and this bill isn't perfect," Boehner told conservative talk radio host Laura Ingraham.

Word from Capitol Hill was that Boehner and his backers were making progress in convincing some conservatives to go along with his plan, improving the chances of passage for legislation that calls for a two-stage increase in the debt limit coupled with spending cuts.

The argument he is using is that there are three choices: the Boehner option, a Democratic alternative in the Senate, or default.

The speaker is walking on a narrow beam. If he is seen as neglecting the demands of his right flank, he could leave himself open to being ousted as speaker, essentially making him the victim of a palace coup.

Some Tea Party members are already calling for his head.

"I think Boehner should step down. He's ineffectual," said Dale Chiusano, a retired federal employee who was among 40 people at a Tea Party rally on Capitol Hill Wednesday.

If Boehner is unable to steer the House toward a package that will avert default, he would be blamed by Democrats, whether fairly or not, for sending the country into a crisis and giving them ammunition to use against Republicans in the 2012 elections.

Boehner may come out a winner among Republicans if his package is approved and the Democratic-controlled Senate makes it a key part of a compromise agreement that stops the runaway train toward default.

"This is his moment," said University of Virginia political science professor Larry Sabato. "One way or the other, his speakership is likely to be defined by what he does and what he can accomplish. Just as you can have a failed presidency, you can have a failed speakership."

If the Senate were to approve a reworked version of Boehner's plan, then he would have to get it approved again by his membership with whatever modifications the Senate made.

"I think this is still a heavy lift for him," said Norm Ornstein, a Congress-watcher at the American Enterprise Institute.

While Boehner is wrangling with his own Republicans, he also has run afoul of President Barack Obama.

As Washington's most powerful politicians, Obama and Boehner need to have a working relationship in order to take on the challenges ahead.

They famously played golf together earlier this summer but whatever goodwill they had built up was damaged last week when Obama expressed his irritation, saying he thought he had reached a deal with Boehner only to be left standing at the altar by him twice.

The two men then sparred on national television on Monday night, giving back-to-back speeches outlining their views on the debt dispute.

"I didn't sign up for going mano-a-mano with the President of the United States," Boehner was overheard to say afterward by CBS News.

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