StanCollender'sCapitalGainsandGames Washington, Wall Street and Everything in Between

debt ceiling

Posted by Stan Collender

House Speaker John Boehner (R-OH) pretty much got what he wanted from week 1 of The Great Shutdown of 2013. Boehner demonstrated to his caucus what he was willing to do for it -- allow the government to be shutdown -- and it seems to be very appreciative of his efforts.

For that matter, the White House and congressional Democrats also got what they wanted in week 1. The White House and House and Senate Ds held firm to their no negotiating strategy and appear to be more unified than they've been in years. And the polls showed that, as expected but hardly guaranteed, it is the GOP rather than the Democrats that are being increasingly blamed for the shutdown.

All sides are now in a better position to cut a deal. Boehner, President Obama and Senate Majority Leader Harry Reid (D-NV) have all now amply demonstrated to their respective constituencies that they are indeed the hard asses they wanted them to be. All of the leader are, therefore, are in a better position to convince their colleagues that a shutdown-ending deal is acceptable.

Posted by Stan Collender

It wasn't too long yesterday after House Speaker John Boehner (R-OH) announced his support for the president's position on Syria that the blogosphere erupted with speculation that the White House had cut a deal. Boehner, it was said, had quickly signed on to U.S. military action against Syria in exchange for the White House moving closer to the GOP position on the upcoming battles on the continuing resolution, the debt ceiling and sequestration, that is, on #cliffgate.

That's nonsense.

The two issues are so separate, the White House and congressional Republicans are so far apart on everything having to do with the budget, Boehner's and Obama's ability to deliver their respective party's votes on spending and revenues so doubtful and Boehner's and the president's history of negotiating so poor that it's virtually impossible to imagine how the administration and the speaker could possibly have come to any agreement on Syria and #cliffgate so quickly.

Posted by Stan Collender

As I've said before, I'm calling the end of this year's debate two things: budget bedlam and "#cliffgate." No matter which name you use, it will begin when Congress returns to Washington next week.

There will be only 9 legislative days before fiscal 2014 starts on October 1. Approximately 15 calendar (but no more than 10 legislative) days later, the Treasury says the government will not have the cash it needs to pay all its bills. At that point either the federal debt ceiling will have to be raised so the government may borrow more or a technical or actual default will occur.

Posted by Stan Collender

Sunday, May 19, 2013, was one of the saddest and most notorious moments in the sordid history of the federal budget.

Let's start from the beginning.

It's December 2012 and House Republicans are facing a number of politically very difficult and unpalatable choices because taxes will go up automatically on January 1, the sequester will go into effect on January 2 and the by-now- commonplace-but-still-called "extraordinary" measures the Treasury has been using for several months to deal with the problems caused by not raising the debt ceiling are about to be exhausted.

The tax problem was dealt with by agreeing to a smaller increase than was set to happen under current law and then blaming the White House for it. The sequester was postponed until March 1 when both the GOP and the administration thought that the threat of cuts to domestic and military programs, respectively, would cause the other to back down.

But it was the unique and disgraceful way the debt ceiling was handled that deserves the scorn.

Posted by Stan Collender

What do you call the effort that will be made in the House of Representatives this week to pass a budget-related bill that will never be enacted, won't work as promised even if it somehow does get signed into law and uses the legislative process for purely political purposes?

"Typical" may be the most common answers. My suggestion? That tried-and-true federal budget phrase so often used to complain about federal spending: "Waste, fraud and abuse."

The legislation is the Full Faith and Credit Act, a bill that supposedly would make payments to federal bond holders the priority if the federal debt ceiling isn't raised and the government doesn't have enough cash to pay all its bills when they come due. The legislation would allow the Treasury to borrow more than allowed by the statutory debt ceiling to make these payments.

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