Foul Deal: What If Republicans Take Yes For An Answer

By Robert L. Borosage, originally published at Huffington Post, July 6, 2011.

Republicans won't take yes for an answer in the debt ceiling negotiations. As conservative columnist David Brooks writes in the New York Times, this should be the "mother of all no brainers."

Republicans have achieved everything they might have imagined at the beginning of the process and more. Yet they still refuse even the smallest of compromises to accept victory.

Brooks correctly concludes that the reason is that the "Republican Party may no longer be a normal party." Instead it is "infected by a faction that is more psychological protest than a practical, governing alternative." But this faction is led not by backbench insurgents, but by House Majority Leader Eric Cantor and Senate Republican leader Mitch McConnell. The faction has taken over the whole.

Brooks aptly summarizes their extremism: they "do not accept the logic of compromise;" "have no sense of moral decency;" "have no economic theory worthy of the name." If Republican adults don't take control, Brooks concludes, "independents will conclude that Republican fanaticism caused this default. They will conclude that Republicans are not fit to govern. And they will be right." Pretty strong stuff from a card carrying, self-professed conservative.

Then Brooks proves he has no clue about Democrats. Most hilariously, he argues that: "Over the past week, Democrats have stopped making concessions. They are coming to the conclusion that if the Republicans are fanatics then they better be fanatics, too."

Would that it were so.


In fact, Republicans have brazenly turned the negotiations into a circus. Now Senate Minority leader Mitch McConnell and a band of Republican Senators demand a vote in both chambers on a constitutional amendment to require a balanced budget, with a ceiling of spending arbitrarily set at 18% of GDP, with super-majorities required to raise that or to raise taxes. This is a level of spending that dates back to the 1960s before Medicare and Medicaid, with a smaller population and before the aging of the baby boomers. It is a laughable level that would require more draconian cuts than those in the Republican budget that garroted Medicare and slashed Medicaid.

But we know why Republicans keep raising the ransom they are demanding as a price for not blowing up the economy. We know why they won't take yes for an answer. They are confident that the president will make ever more concessions, and it doesn't take much imagination to understand why they think that.

But contrary to Brooks, the unanswered question is why Democrats aren't saying NO. It will take Democratic agreement to get the measure out of the Senate -- and most probably Democratic votes to get it out of the House. But while Republicans have continued to impose ever more demands, Democrats have been AWOL, absent without leave. Other than Senator Bernie Sanders, they've said little publicly, drawn no lines in the sand, set no minimum demands. They've acceded to the president's request that they leave the negotiations to the White House. They haven't decided to be fanatics; they haven't even decided to display a pulse.

It's worth recapitulating the retreats already made. The most sensible position, supported by Senate Majority Leader Harry Reid at the beginning of this process, is simply to lift the debt ceiling, itself a procedural anomaly, with no preconditions simply to cover the debt that the nation is committed to by measures passed into law by the Congress.

Instead, congressional Republicans said they'd blow up the economy and refuse to lift the debt ceiling unless there was significant deficit reduction as part of the deal. The president conceded that; Democrats said nothing.

Then Republicans arbitrarily demanded that there be $1 trillion of deficit reduction over 10 years for every $1 the debt limit was raised. The president conceded that; Democrats said nothing.

Then Republicans said there could be no increase in tax rates -- not on hedge fund billionaires who pay a lower tax rate than their chauffeurs, not a surcharge on bankers who got bailed out, not on corporations sitting on $2 trillion in cash. The president conceded that; Democrats remained mute.

Then Republicans said, needless to say, no new taxes -- no taxes, for example, on Wall Street's financial gaming which would simply be good policy The president conceded that; Democrats... sigh.

Then Republicans demanded cuts in Medicare and Medicaid, largely to help them off the limb they put themselves on by passing a budget that would end Medicare as we know it and slash Medicaid. The president conceded that; Democrats sounded a remorseful concern.

The reported deal now on the table amounts to $1.5 trillion in spending cuts, including $200 to $300 billion in cuts from Medicare and Medicaid over 10 years. The president sought about $150 billion in loophole closings -- oil company subsidies, private jet depreciation rates, and that there be some allocation of the spending cuts to the military. That's $150 billion over 10 years; $15 billion a year in new revenue.

Not one to one spending cuts to tax hikes, despite the fact that Bush tax cuts dug much of the hole we are in. Not half of the spending cuts from the defense budget that has been bloated over the last decade. Instead 10 to 1 in spending cuts to tax loopholes closed, and the Pentagon cuts left to the measured judgment of Republican appropriators in the House.

And Republicans said no. They want no loophole closing which they term tax hikes. And no allocation to the Pentagon. And oh, by the way, a prior vote on a constitutional amendment to balance the budget. Next week, they'll demand prayer in the school, exile of Elizabeth Warren for championing consumers, and the president's first born.

And Democrats say -- nothing. If Republicans say yes to what is apparently on the table, the president and his Democratic allies will sign onto an agreement that will damage any growth -- for the cuts apparently are to begin in October in a faltering economy, exact greater sacrifice from programs for the vulnerable than from the wealthy, and basically exempt the Pentagon budget, by far the greatest source of waste, fraud and abuse in the federal government. They will make Gilded Age inequality worse, extend poverty, slow growth, and most likely, increase unemployment. Then they can explain to voters that they are the moderate alternative to Republicans, even though they just cut a deal on the terms of a "faction" that even David Brooks says is bereft of "moral decency."

This is a losers' game, bad for the country, bad for the economy, bad for the possibility of reform vital to this country's future. If Democrats were an organized political party, they would simply say no. No Democratic votes for a deal as imbalanced as the one on the table, one that exacts sacrifice from the vulnerable, cuts programs for the middle class, and exempts the wealthy and the Pentagon. They would demand shared sacrifice. As much in tax revenues from the rich and corporations as cuts in programs for the people; as much in cuts in the Pentagon as cuts from domestic programs. No shared sacrifice; no deal. Not all Democrats would agree -- that goes without saying -- but with a little leadership, enough could sign on to bring the circus to a halt. Instead, Harry Reid should introduce a bill to raise the debt limit only to the level required by the budget House Republicans just passed, and announce that Americans should decide in the election which party they trust to figure out how to get under that ceiling.

Of course, Republicans could refuse to pass the debt ceiling required by their own budget. They could refuse to leave the backrooms and take their case to the voters in the election. They could choose to endanger the full faith and credit of the United States to get their way. Brooks suggests they may be so extreme as to end up there. Personally, I'd expect that the combined weight of Wall Street, corporate and country club America would get them to change their minds rather quickly.

But what's the alternative? Cave to an unjust and extreme set of demands? We know where that leads. If the adults finally get the rest to say "yes," then what Brooks calls the "faction" will then turn their attention to next year's budget -- the fiscal year begins in October -- threatening to shut the government down -- as they did last December -- unless the president agrees to even deeper cuts. And they will use the debt ceiling deal as the minimal template for any agreement -- no tax hikes on the wealthy, all spending cuts from programs for the vulnerable. Why would they not do that? The president surely will negotiate. And the Democrats? The Democrats?