Live Blog: Negotiating with Tea Party Terrorists

And the worst Tea Party Terrorists are in the White House “negotiating” with themselves. The only explanation for the way Obama is acting is that he doesn’t want a second term. I just don’t see how he can think he’s going to be reelected either way–whether the U.S. defaults on its debts or Congresses passes one of the austerity plans, Obama is toast.

I guess he can’t wait to start raking in the millions he’ll get from the sitting on bank boards after this is all over. I used to think he was looking forward to making big bucks on the lecture circuit, but who will want to hear him speak about how he destroyed the social safety net and brought down the U.S. economy?

I thought I’d put up a post for those of us who want to keep tabs on what the Senate is doing this afternoon. I’ll have more info shortly, but feel free to document the ongoing slow-motion nightmare in the comments while I set up my laptop in front of the TV and turn on C-span.

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The Reid plan failed to achieve cloture in the Senate, so it’s looking like whatever McConnell, Boehner, and Obama are cooking up is what we’ll get stuck with. Here is what is known about the plan that is on the table right now.

If Democratic and GOP leaders finalize a deal, they would still face the tough task of convincing their rank and file to swallow a compromise. Fervent liberals and conservatives could scuttle any deal between the White House and congressional leaders. Here are the details of the tentative pact, according to several sources who spoke to NJ on condition that they not be identified:

•$2.8 trillion in deficit reduction with $1 trillion locked in through discretionary spending caps over 10 years and the remainder determined by a so-called “Super Committee.”
•The Super Committee must report precise deficit-reduction proposals by Thanksgiving.
•The Super Committee would have to propose $1.8 trillion in spending cuts to achieve that amount of deficit reduction over 10 years.
•If the Super Committee fails, Congress must send a balanced-budget amendment to the states for ratification. If that doesn’t happen, across-the-board spending cuts would go into effect and could touch Medicare and defense spending.
•No net new tax revenue would be part of the special committee’s deliberation.
That last item remained a potential sticking point. Obama’s advisers insisted on the Sunday talk shows that the president expected tax increases to be part of the Super Committee’s plan. “I think any long-term deficit-reduction is going to include revenues,” Obama adviser David Plouffe told ABC’s This Week.

Yet Plouffe was unwilling to commit that revenue increases would automatically kick in — along with spending cuts — if the Super Committee doesn’t hit the $1.8 trillion target. McConnell bluntly said that “job-killing tax increases” are off the table.

The ever-hopeful Ezra Klein says Dems will lose now but could win later.

Democrats are going to lose this one. The first stage of the emerging deal doesn’t include revenue, doesn’t include stimulus, and lets Republicans pocket a trillion dollars or more in cuts without offering anything to Democrats in return.

The second stage convenes a congressional “Supercommittee” to recommend up to $2 trillion in further cuts, and if their plan doesn’t pass Congress, there’s an enforcement mechanism that begins making automatic, across-the-board cuts to almost all categories of spending. So heads Democrats lose, tails Republicans win.

It’s difficult to see how it could have ended otherwise. Virtually no Democrats are willing to go past Aug. 2 without raising the debt ceiling. Plenty of Republicans are prepared to blow through the deadline. That’s not a dynamic that lends itself to a deal. That’s a dynamic that lends itself to a ransom.

But Democrats will have their turn. On Dec. 31, 2012, three weeks before the end of President Barack Obama’s current term in office, the Bush tax cuts expire. Income tax rates will return to their Clinton-era levels. That amounts to a $3.6 trillion tax increase over 10 years, three or four times the $800 billion to $1.2 trillion in revenue increases that Obama and Speaker John Boehner were kicking around. And all Democrats need to do to secure that deal is…nothing.

The only thing that can prevent increased revenue, says Klein, is the Obama administration. That’s pretty pathetic. Even Klein isn’t sure Obama will let the Bush tax cuts expire.

For more background, see my and and Dakinikat’s posts from last night.

I’ll put further updates in the comments.

Capital on fire