07/12/2011 09:13 am ET | Updated Sep 11, 2011

It's Not the "Administration's Debt Ceiling"!

I haven't weighed in on this for a few days as I thought it made more sense to watch things develop. But nothing much appears to have changed, even as we get closer to the deadline.

Still, my theory of the case remains this: it all comes down to a number game, and I don't mean dollars, I mean votes.

Boehner and of late, even McConnell, while seemingly immovable on revenues, do not want to be responsible for a default that could take a fragile economy back into recession. But their control over their caucus in the House is tenuous. Their intractability is at least in part, posturing to a) get a better deal (more cuts, less revenues), and b) appease the zealots.

The question is, how many House Republicans can they drag along at the end of the day to support a deal that will have at least some revenues? Team Obama/Biden, to their credit, have never wavered on this and that matters too, vote-wise. They can't get their caucus behind them without revenues in the deal, because, as the president pointed out yesterday, no revenues would mean putting everything on the spending side of the ledger, and that would do far more harm than good, both to the economy and to the people in it.

I believe the administration can get the Democrats behind a package that raises the ceiling and reduces the deficit somewhere between $1 and $2 trillion, includes something in the $500 billion range on revenues, takes on some sacred cows (entitlements), hopefully less on the benefits side than on the costs savings side.

It remains an open question whether Boehner can deliver on some version of the above, but man, he and his team are making it hard to stay calm.

Apparently, yesterday they introduced a new and particularly outlandish theme. From this morning's Washington Post:

Boehner suggested that the only concession Obama should expect from Republicans is a vote to allow the Treasury to continue borrowing.

"Most Americans would say that a 'balanced' approach is a simple one: The administration gets its debt-limit increase, and the American people get their spending cuts and their reforms," Boehner told reporters at a news conference before heading to the White House.

That is SO not the definition of negotiation.

I hate to go to the "all caps" place, but they leave me no choice.


Mr. Boehner, you've already accepted a budget -- the budget that's currently in place running the government -- that depends on raising the debt ceiling. You then voted for another budget -- the Ryan budget -- that also depends on raising the debt ceiling by trillions. And by dint of your position, you, among others, are responsible for the economic damage that failing to raise the ceiling will cause.

I've already explained my position on Cantor's canter from the table, but to take this position is to metaphorically walk away from the table.

One can only hope this is more posturing for leverage, but as the graph below shows, it's getting close to freak-out time.

(Note: got to give it up to a WaPo copyeditor who, riffing off of Obama's exhorting the R's to come to the table and "eat your peas," said that it's time to "give peas a chance."


This post originally appeared at Jared Bernstein's On The Economy blog.