Tuesday, July 23, 2019

Debt ceiling deal tries to keep things smooth. Which is why Dems shouldn't go for it

Wanted to give a rundown of the budget deal on Capitol Hill, at least as it stands today. Let me forward you to the Congressional Budget Office's summary of what's in the bill that is slated to be voted on in the House this week.
Section 101 would revise the caps on defense and nondefense discretionary appropriations for fiscal years 2020 and 2021 to allow for higher amounts of funding than is permitted under current law caps and budget enforcement procedures. The total proposed caps for 2020 would be $171 billion above the current law caps of $1,119 billion. For 2021 the proposed caps would be $153 billion above the current law caps of $1,145 billion. There are no caps on discretionary funding after 2021. The proposed increase for 2020 includes a new maximum adjustment of $2.5 billion to the nondefense cap for spending for the periodic census.

Title III would temporarily suspend the current debt limit through July 31, 2021. On the following day, the debt ceiling would be raised by the amount of obligations incurred up to that point. Enacting that title, by itself, would have no effect on the federal budget….

Section 402 would extend mandatory sequestration through fiscal year 2029. Compared to current law, the Medicare provision would increase spending for most Medicare benefits by about 2 percent for April through September 2027, reduce spending by 2 percent for October 2027 through March 2029, then reduce spending by 4 percent for April through September 2029.
So most of the “extra spending” in the bill is really the removal of spending caps for the next two years. How much is actually spent for Fiscal Year 2020 is something that can be figured out over the next 2 months, and then the budget for FY 2021 will likely be worked out next year.

Politico had a good rundown of the deal, and some of the reasons why both Democrats and Trump/GOP are going along with it (for now).
Though Trump’s administration has repeatedly proposed massive cuts in its annual budget plans, lawmakers in both parties have laughed off the proposals. Now Trump has agreed to a second sweeping budget deal with Democrats that increases spending by more than $300 billion.

“This was a real compromise in order to give another big victory to our Great Military and Vets!" Trump tweeted Monday night in announcing his support for the $1.37 trillion package.

But some in Trump's party were far less excited, wary that the profligate spending under Trump makes Republicans look like hypocrites….

Speaker Nancy Pelosi (Calif.), who served as the lead Democratic negotiator, and Senate Minority Leader Schumer (D-N.Y.) hailed the deal, saying it met their priorities for more domestic spending while "turning off" the tens of billions in automatic spending cuts slated to go into effect if no deal were reached.

“Democrats have always insisted on parity in increases between defense and non-defense, and we are pleased that our increase in non-defense budget authority exceeds the defense number by $10 billion over the next two years," the two Democrats said in a joint statement. “It also means Democrats secured an increase of more than $100 billion in funding for domestic priorities since President Trump took office."
However, I don't see anything in this deal that reverses any part of the GOP Tax Scam that has done little except blow up the deficit and give a boost to a group of people who didn't need any help to begin with. So a deficit that is already supposed to be around $1 trillion in each of the next 2 fiscal years will go even higher without any new taxes to offset the spending.

So why would a president who promised to remove the national debt within 8 years add to a debt that has already zoomed past $22 trillion? Because GOPs know in their hearts that government spending helps the economy!
Some of Trump’s close advisers, including hard-line fiscal conservatives like acting White House chief of staff Mick Mulvaney and acting Office of Management and Budget Director Russ Vought, pushed for more cuts to spending or a one-year deal at current spending levels.

But Democrats refused to go along with such a plan, and at the end of the day, Mnuchin and Trump believed a happy Wall Street — along with voters who like federal spending and want to see the values of their 401K plans rising — was more important than the deficit, to the disappointment of GOP conservatives.

That last part is exactly why I wanted Dems to hold up this deal until they could get Trump/GOP not to obstruct investigations any more and to answer all subpoenas and come before Congress. The one thing keeping Trump and the GOP halfway afloat at this time is that the economy hasn’t fallen apart yet. The average dope looks around, sees things relatively stable with some signs of growth (in their lives and community, anyway) and says "I guess Trump is doing fine."

If a debt ceiling deal fell apart, there'd be an immediate Wall Street panic. Think a drop of 1,000-2,000 points in the DOW would get the real owners of Capitol Hill knocking on the door and make Trump/GOP start to get in line about following the law really fast. And people would start thinking twice about an economy that's a lot shakier than they want to know.

But of course, the Dems wouldn't dare cause a showdown on the debt ceiling and the GOP Tax Scam before the 2020 elections. Because that would be mean and not the act of a responsible political party. Which means that if a Dem wins the presidential election in 2020, the debt ceiling limit gets hit with the new president's first budget. And a former top staffer to ex-Senate Majority Leader Harry Reid points out that Republicans will not be nearly as responsible or willing to compromise in that situation.

This is why I'd VOTE NO on this deal, and make the GOP (who are opposed by the general public on taxing and spending policy issues) have to respond and justify keeping their deficit-exploding and regressive fiscal policies in place , and actually face consequences for their crookedness and lawlessness. PLAY HARDBALL WITH THESE LOWLIFES, GD IT!

No comments:

Post a Comment