Anyone paying attention to the goat rodeo formerly known as the House of Representatives knew, before noon on Thursday, that Republicans were screwed. At an 11:10 a.m. press conference, held near the Capitol’s statue of Will Rogers, Majority Leader Eric Cantor reintroduced the GOP’s “Plan B” package of fiscal cliff solutions—a bill that would replace the scheduled defense cuts with cuts to social programs, and a bill that would extend the Bush tax cuts for all those with income over $1 million. A reporter asked Cantor if Republicans had the votes to push this through.
“We’re going to have the votes to pass the permanent tax relief bill,” said Cantor, “as well as the spending reduction bill.”
The roll calls were scheduled to take place seven or eight hours after the press conference. That suggested that Cantor needed more time to round up Republican support. And yet one hour later, a reporter began a question to White House spokesman Jay Carney this way: “Majority Leader Cantor says he has enough votes to pass Speaker Boehner’s plan B.” The conditional—“going to have”—had been transformed, by an inattentive observer, into the confident “has.”
The slippery, confident-but-not-certain version was true. On Thursday night, Republicans barely passed the Spending Reduction Bill of 2012—the replacement of sequestration—with 215 votes, losing 21 of their members and winning over no Democrats. That was supposed to be the popular half of Plan B. Cantor’s party rushed through some meaningless bills (S. 925, “to designate Mt. Andrea Lawrence”), then went into recess, presumably to wrangle votes. They seemed to be around 22 votes short, when 23 “nays” would kill the bill.
When they met behind closed doors, Boehner told his members that they were done, and could go home for Christmas. Some of the “no” votes didn’t even bother to show up, opting to attend a gumbo-themed send-off for a member who’d lost his re-election. Those who did show up heard their speaker declare defeat and recite a prayer: God grant me the serenity to accept the things I cannot change, the courage to change the things I can, and the wisdom to know the difference. And then it was away for Christmas.
The meltdown shocked Washington, but it shouldn’t have. Here are the four reasons why:
This had all happened before. Boehner had failed in the exact same way just 16 months earlier. He was facing down the White House over a possible “grand bargain” to cut spending and raise taxes. He wanted to strengthen his hand by proving that the House could pass a compromise (but conservative-friendly) bill that raised the debt limit, and when it did, the Democratic Senate would have no “excuses for inaction.” On July 28, 2011, Republican whip Kevin McCarthy spent hours bargaining with conservatives, adding their priorities to the plan—making it more toxic to Senate Democrats. As midnight approached, Republicans threw up their hands and postponed the vote. Hard-liners had been here before, with control of Congress, a feckless president, and a message that they wanted to sell: “We’re serious about spending cuts.” After 2011, they felt they’d traded away a good hand for nothing. They wouldn’t do that twice.
Republicans still don’t want to raise taxes, of any kind, ever. McCarthy managed to get a narrow win on that compromise bill on July 29. That bill included no tax increases. “Plan B” did, and top Republicans alternately explained that 1) the increase was very small, affecting maybe 0.18 percent of Americans and 2) a worse tax hike would happen anyway, if the party did nothing, because all rates would go up on Jan. 2. “It is not a tax increase,” said Rep. Tom Cole to reporters, before the vote. “It would be like saying we voted for the Bush tax cuts, and they were temporary, we voted for future tax hikes … making them permanent is a huge victory!” It was a clever argument that had the virtue of absolute truth. Conservatives didn’t buy it.
The conservative movement opposed Plan B. On Thursday morning, Grover Norquist’s Americans for Tax Reform released a statement that seemed to absolve Republicans of a pro-tax vote. Because they had “already voted twice to prevent any tax increases on any American,” and because this bill would “prevent tax increases” in January, voting for it wouldn’t violate the “no net tax increase” pledge. Washington had spent a week or so of December casting Norquist as a conservative Merlin; now the spell was broken. But it wasn’t. Norquist’s outfit quickly added that this statement was “not to be misconstrued as an endorsement of any legislation.”
The feeling was contagious. FreedomWorks initially offered “two cheers” to the plan, congratulating Boehner for apparently abandoning fruitless talks with Obama. Later in the day, it swung back—it would oppose the vote and count “ayes” against Republican candidates. The Club for Growth, the group with the best record of unseating moderate Republicans, always opposed the vote. Rush Limbaugh called the plan a “cave,” and if the party went there, it was “agreeing to raise taxes on the rich under the premise that the problems exist because the rich got their tax cut in the first place and therefore haven't been paying their fair share.” And Heritage Action, the campaign arm of the think tank soon to be run by Sen. Jim DeMint, warned of the same dark consequences. The Chamber of Commerce wanted Republicans to get behind Plan B. That tells you everything you need to know about who matters to House conservatives.
No one fears the “fiscal cliff.” On Sept. 29, 2008, the Democratic House failed to pass TARP. The Dow Jones Index ended the day down 777 points. On July 27, 2011, one of the days when Boehner’s Republicans punted on a debt deal, the Dow plunged 199 points. The markets haven’t responded to the “fiscal cliff” this way. Stock prices are generally up since the Nov. 6 election. On Thursday night, I asked outgoing House Rules Chairman David Dreier why that was.
“I follow the market very, very closely,” he said. “I follow it throughout the day. There is a sense that something is going to get done, and from people I talk to in the market, in that business. It stops being true by the end of next week. But there’s a possibility we go over and we’re able to come back. The market reaction wouldn’t be very positive, but as long as there’s an end in sight, if it happens in mid-January—it depends on the details.”
Dreier, who retired this year, will be gone by then. Among the 215 “ayes” for the sequester replacement, the test vote that barely passed, were 25 Republicans who won’t be in the next Congress. Nineteen of the 22 members who voted “no” or “present” will still be around in January. None of them fear John Boehner.