Debt debate: The House rejects the Senate's plan before the Senate even votes on it.

Who's winning, who's losing, and why.
July 30 2011 10:33 PM

Don't Worry, It Gets Worse

Today in the debt-ceiling debate: The House and Senate trade insults. The House wins.

The first version of Senate Majority Leader Harry Reid's compromise debt plan died an expected and ignoble death Saturday afternoon. The poor thing never had a chance. Before the Senate even voted on it, and instead of waiting for the bill to be sweetened with the sort of items that Republicans could support, the House GOP teed up a vote and defeated it easily—246 to 173.

Members of both parties, resigned to failure, spent the House debate prepping their next sets of talking points. Republicans warned that Reid's plan, which raised the debt limit by $2.4 trillion with just that much in spending cuts, would throttle military spending. Democrats warned that Boehner's plan would "cut Medicare and Social Security." And every time they said that, the other side of the chamber echoed with groans and sighs.

David Weigel David Weigel

David Weigel is a Slate political reporter. 


"Both the Boehner and Reid plans have nearly identical—identical!—plans to establish joint select committees," said Rep. David Dreier, R-Calif., the chairman of the rules committee, who spent the week shoving version after version of Boehner's plan through.

Democrats revolted at that, heckling and booing Dreier. "I thank my friends for maintaining order," Dreier snapped.

If America actually solves this crisis, and the debt limit is increased by some mash-up of the Boehner and Reid plans, that little spat is a preview of the screams to come. Dreier was right: Democrats wanted to create a Joint Select Committee on Deficit Reduction, a 12-member, bipartisan body that would recommend new cuts or revenue streams to Congress. But Democrats were right, too: Under their plan, cuts to Medicare, Social Security, and Medicaid are less likely than in the Republican plan.

If you're enjoying this crisis, as they used to say on late-night TV, stay tuned. An even bigger fight will come when real cuts to the most popular social programs are part of the deal to raise the debt limit.

Here's the dividing line. Both the Boehner and Reid plans create a powerful committee. (Whichever aide gave it the catchy, horrifying name of "Super Congress" deserves the Marvel No-Prize this month.) Under each plan, the committee gets going in a hurry, conducting its business in public, sending its first recommendations out in October and putting up its recommendations for votes by December. If at least seven members of the committee approve a plan, it gets up-or-down House and Senate votes with no amendments.

There's a key difference between the plans. Under the Boehner bill, the debt limit will be raised in a way that will let the government pay bills for around six months. There just has to be a vote on the deficit committee's recommendations before the debt limit is hiked again. Under the Reid bill, there's a $2.4 trillion debt-limit hike right away; the deficit committee's plan will be voted on separately.

"We're saying raise the debt ceiling for 18 months," said Rep. Rob Andrews, D-N.J. "During those 18 months we can have an extended debate over how we cut the deficit. We either will or we won't."

That's just not good enough for Republicans. Look at the last few long-term deficit-reduction plans, they say, and you see how hard it is for Washington to choke them down. Rep. Paul Ryan, R-Wis., put out a budget plan that turned Medicare into a voucher—sorry, "premium support"—plan. Democrats whittled that into a club and won a special election in western New York with it. That plan didn't even touch Social Security. The Bowles-Simpson plan did, and it died quickly, to live on as a spectral presence in Tom Friedman and David Brooks columns. A-ha: What if you tie the entitlement cuts to another debt-limit increase?

"The only way we can get the level of cuts we need is that to cut entitlements, or slow the increase in spending for entitlements," explained Rep. Bill Cassidy, R-La. "There's just not enough time to get an entitlement plan. We have one. It's the Ryan budget. But Democrats wouldn't take it up. So under this plan, the first tranche of the debt limit takes us to February, and then we get to the commission. It's not to mess up the president. It's to get the cuts."

Democrats would love to avoid this. They thought they had. Senate Minority Leader Mitch McConnell had called the debt crisis the best chance in ages for entitlement cuts, but it hadn't happened. As far as Democrats knew, if "grand bargain" negotiations succeeded, the debt deal would have meant raising the age of Medicare eligibility from 65 to 67. But now the most likely legislative solution to the crisis involves another hostage negotiation in 2012. Even moderate Republicans support it.

"You've got to make sure [the vote on the committee recommendations] happens," said Sen. Olympia Snowe, R-Maine, in a short hallway conversation. She's one of the only Republicans who hasn't ruled out a vote on the Reid plan, but she wants this trigger. "In the Reid plan, there are no assurances—there's no specificity of what the cuts are, no guarantee they occur. In the Boehner plan, there is a guarantee. I would have preferred something different, but that's where we are."

Democrats want to stop this. There's one argument against it that they're really comfortable making: Multiple debt-limit votes will create more uncertainty. Who wants to go through this crisis again? The answer: Republicans.

"Going through this experience means we'll probably be better at it the next time," said Rep. Tom Cole, R-Okla., dismissing the idea that markets will panic at another multi-stage debt showdown. "I think my Democratic friends are afraid of that because they're going to lose the first stage and they're going to lose the second."



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