House Votes For Short Term Debt Increases, But This Only Extends the Political Theater

Within the next two months, Congress must decide on increasing the debt limit, allowing the sequestration cuts to take effect, and whether to pass a continuing resolution allowing to government to operate. 

The failure to do one, two, or all three of these things will be a good indicator of how the 113th Congress will function and whether or not progress will be made on other major issues, such as gun control and immigration.

It doesn’t look good. Some may think the GOP retreat in Williamsburg, Va. last week was meant to provide the Republicans a secluded spot to lick their wounds from the election and fiscal cliff fight. Some wound-licking may have taken place.

From reports though, the retreat was more a strategy session, how could the party move forward and work with Democrats to pass much needed legislation. How serious the GOP is was substantiated by Wisconsin Congressman and the party’s Vice-Presidential candidate Paul Ryan. Ryan acknowledged the GOP cannot let the country default and he and House Speaker John Boehner (R-Ohio) would bring a bill raising the debt limit to the House floor in the coming weeks.

As positive as this appears, it didn’t take long for battle lines to be drawn. The GOP bill will be for three-months with further increases tied to the Senate passing a budget resolution. While one may think that’s easy, the Senate has not passed such a resolution the entire time of President Obama’s first term even though the House has. In other words, the country has not had a formal budget in four years.

Since the budget resolution is what lays the foundation for spending, reconciliation of the Senate and House resolutions would set the stage for discussions on spending cuts and revenue increases. To give time for Senate and House conferees to reconcile the two budget resolutions, a safe assumption would be the required continuing budget resolution needed to keep the government running past February would be passed with little opposition. Sequestration cuts would most certainly be put off, pending the work of the conference committee.

No credence can be given to Speaker Boehner’s threat to withhold Senate pay if they do not pass a budget. The Twenty-Seventh Amendment states that any change to congressional pay cannot take effect until the following Congress. If the government shut down, Congress’ pay would most likely only be delayed.  

The Republicans are reaching out. The Democrats are not reciprocating. The president has repeatedly said he will only accept a debt limit extension with no conditions attached. While the three-month increase would stave off default, the White House and Democratic leaders are saying that is not long enough. In response to the request for the Senate to pass a budget resolution, the third-ranking Senator, Charles Schumer (D-N.Y.) said the Senate would pass a budget but it will include revenue increases. I would expect such, and in fact that is the purpose of the Senate and House conference committee, to work out the differences. What made this statement a negative was the tone. It was not in a spirit of cooperation. It was said to confront and challenge.

To the victor goes the spoils. Polls are showing voters equally support both parties positions so most likely the blame will be shared if the government shuts down. This is significant in that had we gone over the fiscal cliff, the GOP was going to get the blame. Perhaps the Democrats have not seen these polls yet and believe they can hold firm and the GOP will fold. However, by coming out with a proposal, the GOP has taken the momentum.

To avoid a government shutdown, the rhetoric needs to stop. If it doesn’t, the Republicans can shift the blame for a government shutdown that they are comfortable allowing to happen.