Congress Set for Show Votes on Debt
House Speaker John Boehner, R-Ohio, listens to House Majority Leader Eric Cantor, R-Va., during a news conference at the Capitol last week. Photo by Chip Somodevilla/Getty Images.
The United States Congress will once again become a Kabuki theater troupe this week when the House of Representatives puts the “cut, cap and balance” plan on the floor Tuesday despite it having nearly no chance of becoming law.
The Republican measure would immediately cut federal spending back to 2008 levels, cap future spending at a targeted percentage of growth domestic product far lower than the current 24 percent and pass a constitutional amendment requiring a balanced federal budget.
The House GOP leadership is well aware of the benefit of giving their members something to rally around before the arm twisting begins on a “hold your nose” vote to raise the debt ceiling next week.
The plan by Senate Minority Leader Mitch McConnell, R-Ky., and Majority Leader Harry Reid, D-Nev., to allow the president to raise the debt limit up to $2.5 trillion in a series of three votes over the next 20 months with an accompanying $1.5 trillion in discretionary spending cuts is still just a plan and not yet legislation. By the end of this week, the Senate will likely have crafted legislative language so that the vote whipping can begin in earnest in both chambers.
Your daily dose of debt/deficit developments includes:
A continued White House push for the “grand bargain” of $4 trillion in deficit reduction through a mix of cuts to entitlement programs and increases in tax revenues.
Sen. Tom Coburn, R-Okla., plans to roll out a $9 trillion deficit reduction package Monday.
- Senators from both sides of the aisle took to the Sunday talk shows to express confidence that the debt limit will be raised prior to the Aug. 2 deadline.
President Obama has decided to pass over Elizabeth Warren as his nominee to run the new Consumer Financial Protection Bureau that she conceived, and will instead tap former Ohio attorney general and current CFPB enforcement chief Richard Cordray for the spot.
The president will announce the decision Monday afternoon in the Rose Garden. Cordray needs to be confirmed by the Senate to fill the job.
“American families and consumers bore the brunt of the financial crisis and are still struggling in its aftermath to find jobs, stay in their homes, and make ends meet,” President Obama said in a statement. “That is why I fought so hard to pass reforms to fix the financial system and put in place the strongest consumer protections in our nation’s history. Richard Cordray has spent his career advocating for middle class families from his tenure as Ohio’s attorney general, to his most recent role as heading up the enforcement division at the CFPB and looking out for ordinary people in our financial system.”
GOP senators opposed Warren’s nomination, and 44 of them have vowed to reject any nominee unless significant changes are made to the agency, the Washington Post reported.
Warren will return to Harvard University, but could also be headed back into politics quickly: she is being courted by the Democratic Party to run against Sen. Scott Brown, R-Mass., in 2012.
Binyamin Appelbaum of the New York Times explains the political realities behind the move:
“Her candidacy was passionately supported by liberal members of Congress and consumer advocacy groups. But she never won the full support of the president or his senior advisers, particularly Treasury Secretary Timothy Geithner, in part because of her independence and outspokenness, which at times put her at odds with the administration.”
The agency will open officially on Thursday.
Cordray, who lost his re-election bid for Ohio attorney general in November 2010, used that office to sue credit agencies and other Wall Street firms that were involved in the subprime mortgage crisis, securing hundreds of million of dollars for the state in the process. Cordray is also considered a contender for the Ohio gubernatorial race in 2014.
He explained his point of view to the Columbus Dispatch in June:
“Cordray said his credo is ‘simplifying and clarifying’ complex financial agreements so average consumers can understand what they are buying. For example, all too often, credit-card agreements were so complex that even college graduates could not figure out the interest rate that would be charged and how the financial penalties would be imposed.
‘If we are enforcing the law against the dishonest businesses, the ones that are competing unfairly and illegally with the honest businesses, then that’s better for all concerned,’ Cordray said. ‘It cleans the markets.'”
The top line numbers indicating how much money each campaign raised in the last three months may get the lion’s share of attention, but it’s the combing through of the actual reports filed with the Federal Election Commission that produces the more important and telling information.
“Tim Pawlenty outpaced his rivals by spending $200,000 at businesses in Iowa, while Romney showered nearly $750,000 on vendors in New Hampshire, where he hopes to command the field….
“The spending patterns seem to back up many of the political stereotypes attached to the major candidates: Obama as grass-roots organizer turned campaigner in chief; Romney the chief executive of a by-the-books campaign; and Pawlenty the eager newcomer struggling to get ahead.”
The New York Times reports that 40 percent of President Obama’s cash haul for the second quarter came from bundlers.
Phil Elliott of the Associated Press writes up Mitt Romney’s huge cash-on-hand advantage over his opponents and adds this key observation: “The gap between Romney and his rivals suggested many Republican donors are waiting on the sidelines, still watching the topsy-turvy campaign.”
Texas Gov. Rick Perry continues to drop hints that he might plunge into the Republican primary process and seemed to tip his hand to the Des Moines Register.
“I’m not ready to tell you that I’m ready to announce that I’m in,” Perry told the newspaper. “But I’m getting more and more comfortable every day that this is what I’ve been called to do. This is what America needs.”
The Register’s Jason Clayworth reports that Perry will decided in the next two or three weeks whether to run. Clayworth summarizes some of the pros and cons of a Perry run:
“Perry’s fans in Texas said he could add pizzazz to a field with a charisma deficit. Minnesota Rep. Bachmann can fire up crowds, but, in his second presidential campaign, Mitt Romney remains stiff working a room. And former Minnesota Gov. Tim Pawlenty has fought to get beyond the impression that he’s a solid candidate but uninspiring.
“Perry would face one hurdle unique in the field: Will Americans balk at the idea of another former Texas governor occupying the White House, just four years after Bush left with a 34 percent job-approval rating? Bush remains a divisive figure among Iowa Republicans and especially among tea party activists for what they see as runaway spending.”
The field is still wide open, and while Romney is the clear front-runner, a June Associated Press-GfK poll showed that 52 percent of Republicans are satisfied with the field.
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