Saturday, July 23, 2011

Raise the Debt Ceiling

It's all up to Boehner and Obama. The right answer is in the middle: a lot of spending cuts and a few "tax increases." In other words everyone will have to accept some burdens he will not especially like.
Obama mus appease the far left by getting as many "tax increases" as he can, and Boehner must appease the tea party by getting as few "tax increases" as he can. On spending cuts, their commitments to the extremes force them in the opposite direction. When the compromise is finally achieved, both men will get a lot of criticism from the extremes.
The debt ceiling increase is being held hostage to both issues because it requires a commitment to reduce the debt, and the way to do that is to decrease the annual deficit so that we pay down the debt faster than we borrow.
I put "tax increases" in quotation marks because neither closing some loopholes for large corporations and extremely wealthy individuals nor eliminating federal subsidies for oil companies with multi-billion dollar profits constitutes a tax increase.
To appease the extremists, Boehner and Obama are going to play hardball right up to the last second. That is pretty scary for all of us in the mushy middle.

1 comment:

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