JONATHAN COHN JULY 29, 2011
The House had all the drama on Thursday night, but the Senate was plenty busy, as well. Even as House Speaker John Boehner was trying (and ultimately failing) to rally fellow Republicans behind his debt ceiling bill, Senate Majority Leader Harry Reid was working on his proposal. Reid has the support of at least 50 senators already. But, to overcome the inevitable Republican filibuster and, eventually, to merge his bill with whatever comes out of the Republican House, he’s going to have to compromise a little more--which means we’re about to hear a lot about “triggers.”
What am I talking about? As you may know, Reid’s bill calls for more than $1 trillion in spending reductions (or more than $2 trillion if you want to count savings from winding down the wars in Afghanistan and Iraq). It also proposes the creation of a commission of lawmakers, with equal representation from the parties, to identify additional savings, also in excess of $1 trillion. And he’d guarantee an up-or-down vote on these recommendations, without filibuster or other procedural tricks. In these respects, his plan is actually very similar to the one Boehner still hopes to get through the House.
But Republicans want more: Specifically, they want a guarantee that the cuts will actually take place. Boehner’s bill would accomplish this by increasing the debt ceiling in stages—first by enough to carry the government through 2011, and then by enough to carry it through 2012. The second increase would be conditional upon approval of the commission’s savings recommendations. And, with Boehner promising his colleagues that no Republican member would recommend new revenue, the savings would have to come entirely from cuts, the bulk of them from some combination of Medicare, Medicaid, and Social Security. Robert Greenstein, president of the Center on Budget and Policy Priorities, has suggested that, "If enacted, it could well produce the greatest increase in poverty and hardship produced by any law in modern U.S. history." (Coming from Greenstein, who usually speaks pretty blandly, that's something.)
Democrats obviously won’t go along with that. Among other things, they are insisting that this deal increase the debt ceiling enough to get the government past the next election cycle. But the Democrats also can't pass a debt ceiling bill on their own. And Republicans won’t agree to a bill that doesn't compel or at least encourage Congress to complete that second round of deficit reduction. That's turned everybody's attention onto triggers, like the ones that President Obama and Boehner discussed when they were trying to negotiate their Grand Bargain.
One option under discussion would effectively impose a second round of deficit reduction automatically, according to a pre-set formula, if Congress doesn't make the changes on its own. And, in theory, both parties could live with something that. But, naturally, the two sides have rather different ideas about the precise formula. Republicans would like to see those automatic savings come mostly, if not entirely, through spending cuts. Democrats want a more balanced approach: They would want the savings to come through some combination of automatic spending cuts and revenue increases. (Yet another, milder option would merely force Congress to vote on the Gang of Six recommendations.)
Does that all sound very familiar? That’s because it is. This is the same debate we've been having all along, between a party that thinks we should balance the budget primarily by cutting spending, even if that means gutting cherished programs like Medicare and Medicaid, and a party that thinks we should balance the budget with a mix of spending cuts and new revenue, even if the latter means raising some taxes. You know which side I would like to see prevail.