What is John Boehner Up To Now?
Posted: July 23, 2011 Filed under: 2012 presidential campaign, Democratic Politics, Republican politics, U.S. Economy, U.S. Politics, voodoo economics, We are so F'd | Tags: Barack Obama, Federal debt ceiling, Harry Reid, John Boehner, Mitch McConnell, Nancy Pelosi, Standard and Poor's, U.S. Credit rating 20 Comments
Bloomberg reports that John Boehner
told Republican lawmakers they need to provide a positive signal on a plan to avert a U.S. default before Asian financial markets open tomorrow, Republican congressional aides said.
Boehner wants at least $3 trillion in spending cuts in a two-step plan to accompany an increase in the U.S. debt limit, one of the aides said. Treasury Secretary Tim Geithner warned President Barack Obama and congressional leaders during a White House meeting today of a possible reaction by Asian markets, said an official familiar with the meeting.
Did what Geithner said light a fire under Boehner or is he getting pressure from other sources–like Wall Street donors?
The markets could be tumultuous if a plan isn’t negotiated over the weekend, said Christian Cooper, head of U.S. dollar derivatives trading in New York at Jefferies & Co.
“The markets will be under very real pressure at the open because the assumption will be there is really no resolution to this,” Cooper said. “The breakdown in negotiations has crossed the line from the political posturing of the last few weeks to potentially a very real crisis.
“The Tea Party is effectively playing Russian roulette with the bond market and they will, with certainty, lose,” Cooper said. Jefferies is one of 20 primary dealers that trade with the U.S. Federal Reserve.
So suddenly the drop dead day is no longer August 2, but tomorrow?
Derek Thompson of the Atantic wrote today that “Dave Beers, director of the sovereign debt division at S&P” told him that S&P is losing faith in the ability of Washington politicians to agree on anything.
“The debt ceiling is not the central preoccupation that we have,” Beers told me this afternoon. “We put the United States on credit watch because we’re growing less certain that this political debate can be resolved. This was not merely about the debt ceiling.”
What about other AAA-rated sovereigns, like France and Canada, who also have high debt burdens? “They all have a strategy that went through the political process, and we think those strategies are credible,” he said. “The problem with the U.S. is that there is no strategy. There is a debate about what the strategy would be. But there’s nothing close to a consensus. If consensus isn’t possible now, when will that be?”
Basically the kabuki nonsense that has been going on for weeks now between President Obama and House and Senate Republicans has already done serious damage to the U.S. credit rating. These guys look like fools to the rest of the world, and we all know the reason for the continuing game playing is that Obama actually wants massive cuts–especially in social programs. Anyone who is paying attention knows that now, even though Obama is still trying to put the blame on the Republicans, he owns this mess.
There is every sign at this point that Congressional leaders on both sides have decided the President just isn’t going to lead on this, and they have decided to work something out without him.
And, to emphasize responsibility now lies with Congress, Boehner and the congressional held their own meeting at the Capitol Saturday evening.
Pelosi and Reid left the meeting with Boehner and McConnell after less than an hour, retreating to Pelosi’s office across statuary hall in the Capitol. The two Democratic leaders refused to answer repeated questions from reporters. McConnell returned to the Senate side of the Capitol minutes later.
On Friday evening the Speaker announced that he was ending on-again-off-again talks with the White House with only days remaining before the Aug. 2 deadline when the U.S. will exceed its borrowing authority.
After a meeting in the White House with Obama, Harry Reid, and Nancy Pelosi, Boehner
told his colleagues that any deal will be a product of congressional leadership – not a compromise struck with the White House, the Republican source said, noting that “strategically not working with the president, but with the Senate could be better for him.”
Boehner was backed up by Democratic leaders Reid and Pelosi, when he said to Obama, “Mr. President, I need to deal with the House and the Senate because we [the White House and Congress] aren’t getting anywhere,” the source said.
Very interesting. It’s also interesting to note that Eric Cantor was not at that meeting this morning. Has Boehner decided to clip Cantor’s wings? We haven’t seen or hear much from him for the past few days.
Sam Stein at Huffpo is reporting that
House Speaker John Boehner (R-Ohio) is set to call the Democratic Party’s bluff on the debt ceiling. The Ohio Republican, in a briefing with his conference on Saturday, announced that he would press for a short-term deal, with major spending cuts paired with longer-term deficit-reduction strategies, as a way around the current impasse.
That strategy puts the speaker directly at odds with the White House and allied Democrats, who have insisted for weeks that they would not support a short-term extension of the debt ceiling.
Actually, Obama already waffled on that, but other Democratic leaders seem determined that whatever deal they reach will carry through the 2012 election. So how serious can Boehner be if he still plans to play chicken on the short-term/longer-term-deal issue?
There are lots more stories out there tonight speculating about what will happen tomorrow. What kind of “positive sign” does Boehner plan to send to Asian markets? Will it convince the ratings agencies not to downgrade U.S. Credit. Will there be a massive sell-off of U.S. Treasury bonds (Our resident expert, Dakinikat, already dumped hers).
I know it’s late, but I thought I’d put all this out there, since tomorrow could be a big day for news on the debt ceiling kabuki fight. Dakinikat told me that Tim Geithner will be making the rounds of the Sunday shows tomorrow. Maybe we’ll learn something from those shows for a change. Stay tuned….
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BB i think this says it best in your artical The Tea Party is effectively playing Russian roulette with the bond market and they will, with certainty, lose,”
i also think John Boehner needs to find a back bone and stop being a puppet of the tea party.
I think the tea party has him over a tea barrel.
Unfortunately, we will lose along with them.
And, BB, you’re so right that Obama now owns this mess.
He actually created it when he didn’t include the debt ceiling in the December negotiations when he gave away the store to the republicans, giving them more than they had dared ask for and beyond their fondest dreams. But, it appears, he really wanted to make the Bush Tax Cuts his own as well.
I said at the time Obama wanted to use another crisis to go after SocSec and Medicare; he’s upped the ante by including even more cuts to Medicaid than he’d already done. Based on reports, he’s also willing to make cuts to his health insurance reform plan. That, of course, is because the cuts will be to things which aid consumers and will not affect profits of the private insurers.
I figured he would use the budget as his big crisis point, but the debt ceiling, with all his warnings and wailings, is perhaps more potent than the budget could be.
Way to go, Corporatist doofus.
This man was in no way ready to be president of the United States, especially in a time of crisis.
Barney Frank:
Comment from Krugman’s blog:
I agree with Krugman. Obama has to go. He’s not simply destroyed the Democratic Party. His lack of leadership combined with the recalcitrant TP contingent seems hellbent on bringing the country down. The kabuki theater we’ve been watching sickens me. Tom Coburn standing before his membership and saying he doesn’t give a damn about what the American public wants sickens me. And now we’ll be schmoozed by Geithner, who it’s reported has had conversations with Hank Paulson, the veteran salesman who sold us the last sh*it sandwich, while the Fed doled out 16 trillion dollars to the casino-playing banks, both domestic and foreign.
We’re being led to the slaughterhouse deliberately, again. Everyone running around with their hair on fire with the tick-tock in the background. Disaster capitalism at its finest. Scare the public half to death. And then grab what’s left of the silver in the dining room.
I don’t trust any of these people, particularly when POTUS has solutions available, which he refuses to take. We’re being played!
McCain would have been better than 0bowma.
Would/could I vote for Romney? I know I will NOT vote for 0bowma. Not voting is still a choice — and since my vote was never counted in the primary.. . . .
We are screwed – one way or the other.
That was a quote from a commenter–not Krugman himself. I don’t know how he feels about getting rid of Obama. I suspect he might agree with us, but he hasn’t come out and said it yet.
Obama reportedly wants to cut US wages* by 30% in order to be “more competitive” in the global economy. I think that’s why he’s so resistant to any real JOBS JOBS JOBS programs.
He wants that large army of the unemployed to force those with jobs to take cuts out of fear of losing their jobs.
*Note: Wages cut, not compensation packages which affect the super affluent…. That’s our Corporatist prez in action.
Thanks for the headsup, BB. I thought Krugman had finally grown a pair and said what needs to be said. I’m not a Romney fan and have already decided to go 3rd party–I simply will not support this ongoing fraud from either side of the aisle. I’ve had family members say: well, you’ll simply waste your vote. Maybe, but I consider it a vote of conscience.
Btw, jawbone is absolutely correct. Obama believes the American worker needs a 30% haircut in wages to become competitive in the NWO. So, we can kiss the idea of jobs, jobs, jobs, unless we’re willing to crawl on our bellies and say ‘thank you, massa’ to the corporate overlords. And Tom Coburn’s Gang of Six has a cute little addition called territorial taxation tucked into the dense language. Cannonfire had an essay featuring the subject and I did a little research. Joe Cannon is right; it is included in the proposal. It’s all about playing dead to corporate interests.
This from Cannon’s piece:
‘The 35 percent statutory corporate tax rate (the only number usually mentioned by neo-liberals who seek to have corporate taxes reduced or eliminated) differs from the effective rate, the amount actually paid. The effective rate, 26.5% under Reagan, dropped to 17.2% under George W. Bush and has not appreciably risen during the Obama years.
Foreign governments collect twice as much corporate tax as we do when those revenues are computed as a percentage of Gross Domestic Product.
Well, guess what? If the Republicans get their way — and they will — America will collect far less in corporate taxes. When your job is outsourced by an American company, the tax paid to a foreign government will be the only tax paid.’
Welcome to the land of NeoLiberalism, where the rich get to feast day and night. And the rest of us? We get to scramble for the crumbs falling off the table.
Jawbone,
All I can say is Michael Hudson must be very glad he has tenure and doesn’t have to teach. I love reading him! He lets it all hang out.
We are screwed – one way or the other.
never kissed tho….. 🙄
I’m not sure what game the ratings agencies are playing. I don’t think they would be making these threats if they didn’t have some backing from some very big players.
In essence, both Obama and the ratings agencies have the same bosses, but maybe not exactly the same individuals within the group calling their shots.
Is Obama in on the threat game? Might be. Has he lost control? Appears to outsiders to have done so. I mean, when a president complains that the House Speaker will ot return his calls…? That’s kind of embarrassing and seems to show weakness.
What kind of game IS being played? Whatever it is, we non-Uberwealthy stand to lose.
Are you serious? Obama democratic view and point of action with the balanced form is the right one. When they both spoke last night you could tell John Boehner was no where close to sounding right. People open your eyes this is someone who is truly fighting for change, but many are opposing it. People want change but it takes time to take in and adapt and see the results especially if they are short term or long term results. His working the right way and as US citizen you just don’t get results by voting you need to constantly fight and back up your vote. You just don’t vote and turn around and say well I did my part now do your magic and fix everything. No he needs you to go to your congressman and have this decision finalize we need the balanced. Its time 1% and the wealthy pitch in to ultimately help this country.
Stop listening to his lying words and pay attention to what he has done. He only is doing things that enrich his wall street banker friends. He has contrived this problem to go after social security funds in the same way bush wanted to but couldn’t. Your naivete is astounding. There is no Santa claus btw. He is asking you to clap to bring the confidence fairy to life for investment bankers.
Oh please. Obama set out to gut Social Security from day one. Try reading his crappy book, “The Audacity of Hope.” Obama announced his intentions quite clearly in Iowa, before the caucuses. He praised Reagan and said Social Security was in trouble and needed to be fixed. He spouted Republican memes like that throughout his campaign. As President, he has gone even further to the right than even we expected.
You’re living in la-la land if you think this man is fighting for you. He’s a puppet of Wall Street, and has given them everything they wanted and more–and he’ll continue to do so until we stop him.
If Obama wanted the top 1% to pay something, why did he push to extend the Bush tax cuts? And why did he offer to make them permanent while he was “negotiating” with Boehner?
I guess we’ve arrived when we start getting the Obots on threads, yes?
I guess so. It’s amazing so many of them are left.