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"C'mon, man!" Joe Biden exclaimed Monday, "Let's get real!" On Wednesday, Barack Obama was so upset that he took his ball and went home, shoving his chair away from the table and saying tersely, "I'll see you tomorrow." The topic, of course, is the debt ceiling, which Obama and his pals at the Treasury Department insist must be raised by Aug. 2 to prevent default on U.S. debt. But this isn't your father's debt ceiling; it's $14.3 trillion currently, and Democrats want $2 trillion more. It's no wonder that tensions are running high. This is where ideological rubber hits the road and either builds America or tears it down.
The sticking points aren't new. Democrats want to raise taxes by as much as $2 trillion in addition to making cuts to various budget items, not least of which is defense. Republicans want cuts with no tax increases. Obama is so insistent on tax increases that, according to a GOP aide in the discussions, he declared, "This may bring my presidency down, but I will not yield on this." He didn't yield as he demagogued Social Security, either. "I cannot guarantee that [Social Security] checks go out on August 3rd if we haven't resolved this issue," he shamelessly warned. Who's throwing grandma off the cliff now?
After that snit, he audaciously criticized Republicans' "my way or the highway" approach.
As for the cuts under discussion, they aren't genuine cuts like those average Americans are making -- buying less milk and fewer eggs, for example. Called base-line budgeting, Washington's cuts are merely reductions in projected growth, as in, "We're still going to buy more milk and eggs than we did last year, but not quite as much as we would have under better political circumstances."
To put it in perspective, spending over the next decade is projected to reach about $46 trillion, including $13 trillion in new debt. The haggling is over $2-4 trillion in cuts to that projected increase. Spreading $2 trillion over 10 years "saves" just $200 billion a year, or less than the interest payment on the debt, and even by reducing projected growth by that much, we still end up with an increase in spending. That, in a nutshell, is Washington-speak.
As for the status of compromise, it has succeeded only in Minnesota, where the Democrat governor and Republican legislature just agreed to end a government shutdown . At the federal level, Republicans have all but given up on a comprehensive reform package. As many as 60 House Republicans might vote against any increase to the debt ceiling, and Democrats control the Senate and the White House, making a deal without their support impossible. What to do?