Loose Canons

Slippery Weasels, Deals, and Triggers

With Mitch McConnell in the driver's seat, the president had no choice but to go along on his ride.

By 8.1.11

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The United States will not default on its debts, the NFL will play this fall, and President Obama's polls are sinking to a level from which he may not recover.

But not all the news is good. Though the deal is apparently done it isn't yet enacted by Congress and it may risk increasing the damage to national security already done by the Obama administration.

At this writing -- late Sunday evening -- the deal has been reached between Senate Minority Leader Mitch McConnell and President Obama. McConnell spoke at about 8:30 p.m. on the Senate floor, confirming that the framework of the deal was done and that the Republican senators will meet Monday morning to -- they hope -- confirm a deal. Democrats and House Republicans will also be meeting, separately, on Monday to consider whether they'll do the same.

Obama came to the microphones about ten minutes after McConnell's announcement. As slippery as a greased weasel, Obama announced a deal had been reached between congressional leaders of both parties. But he never said he endorsed it. Senate sources told me last night that Obama had committed to it and that McConnell wouldn't have gone on record without Obama's concurrence. But because "the liberals were going ballistic," Obama didn't have the guts to publicly endorse the deal last night.

Because there won't be time to pass the necessary legislation by Tuesday, there will be a short-term debt ceiling hike -- perhaps for as short a time as two or three days -- before the big "trigger-unhappy" deal is enacted.

McConnell was in the driver's seat for two reasons. First, House Speaker John Boehner was double-crossed by Obama and rightly walked away from negotiating with Obama two weeks ago, but his plan to cut a deal with Nancy Pelosi and Harry Reid was -- as I pointed out at the time -- bound to fail. When it did, and after Boehner's own attempt at a solo solution was blocked by House conservatives, Boehner was so weakened that McConnell was forced to step in. Second, because the "notoriously subdued" McConnell (as the Washington Post characterized him yesterday) proved able to flush the president out of the tall grass that he's been hiding in for months.

McConnell, as he said repeatedly this weekend, was negotiating with the only person who can sign a bill into law. "If we get a deal," he said yesterday, "the president will be supporting it."

We know a lot about the deal, and part of that knowledge is that neither Boehner's plan nor Reid's will be the result.

Boehner 2.0 was a classic -- and classically awful -- "if-then deal," the kind of deal I warned against three weeks ago. According to the CBO, Boehner 2.0 would have cut the ridiculously small amount of $22 billion from the deficit in 2012. If -- and only if -- future Congresses abided by it, the Boehner bill would have cut only $915 billion off the federal deficit over the next decade. (The debt ratings agencies had said that American federal debt would have to be cut by at least $4 trillion over that time to avoid a downgrade.) Boehner's bill passed the House and was quickly rejected by the Senate.

Reid's bill was even worse and deceptively so. As I wrote last week, Obama would rather we default than forgo the tax hikes he craves. So when he endorsed Reid's bill and the media proclaimed it to be without tax hikes, I had a moment's pause.

But only a moment's, thanks to the indefatigable Sen. Jeff Sessions (R-AL). Sessions' staff analysis revealed that Reid "deemed" two years of budgets in to being. (It's been 823 days since the Democratic Senate has passed a budget.) Under Reid's bill, current law was extended through 2013. That meant the Bush-era tax cuts would expire and the alternative minimum tax "fixes" -- which prevents that law from doing greater harm -- wouldn't be made. In short, Reid tried to slip tax hikes costing about $3.8 trillion (over a decade) past us, and Sessions caught him at it.

Reid had to pull his bill from certain defeat late Saturday night after McConnell sent him a letter promising all 43 Republicans would vote against it. Reid went ahead with the vote yesterday afternoon, and the bill -- as expected -- failed when Reid didn't muster enough votes to overcome the Republican filibuster.

From what McConnell said Sunday morning, and reports through the day, here's what we know about the deal. It looks a lot like the deal McConnell proposed three weeks ago.

There will be no default and, as McConnell told CNN's Gloria Borger yesterday, "There will be no tax increases in this deal." White House political advisor David Plouffe tried to laugh this off on TV yesterday, saying that no one is talking about hiking taxes in the next year and a half. Obama contradicted Plouffe in his late Sunday statement, assuring the libs that he'd be pressuring the new congressional committee created in the deal to "balance" the spending cuts with tax hikes.

Obama will get the debt ceiling increase he wants, but not all at once. It will be in three tranches, as McConnell proposed three weeks ago: a $400 billion hike now, another $500 billion later this year subject to a congressional resolution of disapproval, and a third dose of about $1.5 trillion next year, again subject to a vote of disapproval.

The increases come at a high price. Congress will have to vote on a balanced budget amendment, but the debt ceiling increase isn't contingent on passing it and sending it to the states for ratification. The increase is tied to the creation of a new congressional joint committee tasked to create legislation to accomplish about $3 trillion in budget cuts over ten years, with about $900 billion enacted immediately. The $900 billion is about the same -- and probably as puny in the first year -- as the Boehner bill proposed.

The "supercommittee" will report by Thanksgiving in the form of legislation that will be submitted to both houses of Congress for a straight up-or-down vote.

McConnell stressed that the new committee, made up of six Republicans and six Democrats -- will have a "broad mandate" and will be expected to deal with entitlement programs such as Social Security and Medicare, tax reform and domestic spending. The crucial element still being negotiated is what Congress will be compelled by the law to do if the new committee either cannot agree on spending cuts or if its report fails to pass either the House or the Senate.

If the deal McConnell described becomes law, it will be the biggest deal since the Obamacare disaster. When that bill was signed, our eloquent vice president whispered sotto voce to Obama that it was a "big f****** deal," and it was. This can be just as big. Whether it is depends on the "trigger" mechanism that will force spending cuts if the new committee can't agree, or if its recommendations fail to pass.

The Republican members can be expected to insist on entitlement reform and big cuts to other domestic programs. You can't get to the $3 trillion target without them. But the Democrats are targeting defense spending and -- as Sen. Chuck Schumer (D-NY) said yesterday -- will fight for tax hikes cloaked in the guise of "tax reform." The idea behind the trigger mechanism is to make the forced spending cuts so painful to each side that neither will risk them. This has to give conservatives pause.

According to several reports, the Democrats are making this a trigger-unhappy bill for conservatives. At last word, the cuts to be imposed if the committee fails to agree or if its recommendations are voted down would be split 50-50 between defense and domestic spending.

The Obama administration has already slashed defense spending by about $400 billion, and the president demanded another $400 billion be cut over the next ten years. None of the prior cuts were -- and none of the future ones will be -- based on what we need our military forces to be able to do. There's no analysis of the threat matrix on which these cuts are being made and planned. The risk is too great: no further cuts can be made without that analysis. The proper analysis, when and if it's made, will draw a bright red line below which defense cannot be cut. Republicans on the new committee must keep that in mind. Whatever the result of the "trigger mechanism" may be, it must not result in another major cut in the defense budget.

The bottom line is that the deal, if it is made on the terms McConnell outlined yesterday, is good if the new committee results in massive cuts to federal spending without slashing defense. It's a deal worth making, but no conservative can rest easy until we see what happens with the November report of the new committee.

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About the Author
Jed Babbin served as a Deputy Undersecretary of Defense under George H.W. Bush. He is the author of several bestselling books including Inside the Asylum and In the Words of Our Enemies. He is coauthor (with Herbert London) of the new book The BDS War Against Israel. You can follow him on Twitter@jedbabbin.