In the midst of all of the hot air being blown about over the debt ceiling two things struck me this morning: first, that a “dollar for dollar” cuts-to-debt-increase-ratio is a silly construct given the additional debt (and spending) is now and the cuts largely illusory; and second, there is an easy solution for the GOP that cuts ACTUAL spending now, and it is both good policy and good politics.
First, let me back up to the “dollar for dollar” nonsense. The idea that cutting a dollar from a ten-year projection is meaningful against a dollar of debt that will be spent before the next president has a Groundhog Day in office is beyond the pale. The dollar of spending is definite – the dollar of savings depends on a whole host of unknowns.
With that in mind, it occurred to me that the easy solution to get a debt increase that protects the markets and to force real cuts now is this: pass a $2T increase in the debt limit with the $1T in future discretionary cuts both sides agree on. But then add this caveat – there will not be a SINGLE Republican vote for another debt increase until February 28, 2013.
In one stroke the GOP cuts the deal that saves the credit rating AND shows a real commitment to real cuts now. It also forces the administration to either veto a deal that “protects the economy” (POTUS’ words) or to accept it and make $400B in cuts over the next year and a half.
After all, President Obama has made it clear he wants the $2.4T in order to get past the election without having to sign another increase (so much easier as a lame duck, I know). If you limit that to $2T, you force an actual cut in spending NOW of $400B.
Think about it – do you want to be the President who has to admit that $2 trillion dollars wasn’t enough for an 18 month window? In the fall of what will be a hairy re-election campaign?
The ad writes itself: “Can we afford another 4 years of a President who spent $2 Trillion in less than a congressional term?”
The strength of this move is that it is good policy (cutting actual spending with a debt increase will assuage many a wary investor) and it is good politics.
If the President can’t live on $2 trillion between now and February 2013 – a mere 19 months from now – let him tell us why in fall of 2012.
After all, how can two trillion dollars for 19 months NOT be enough? Its $105 Billion dollars a month. Its $288 Millions dollars a day (and yes, I added leap year).
The fact is the only way to get real cost savings out of this administration is to limit its access to cash. The GOP needs a deal it can swallow – how about one it can trumpet?
Photo by Chris
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