A Favorable Debt Ceiling Deal in December Was Not Possible, Says White House Advisors
1 year ago
Valerie Jarrett: "Republicans were not going to extend debt ceiling back then."
Despite arguments that President Obama could’ve dealt with the debt ceiling promise last December, while there was still a Democrat majority, instead of waiting until near-default, White House officials are saying no debt ceiling deal was possible in December.
“We could not get this then, they were not willing to give it to us,” said senior adviser Valerie Jarrett on a conference call about the debt ceiling agreement. “The Republicans were not going to extend the debt ceiling back then.”
The agreement that was reached yesterday, and is being voted on today lists a significant amount of compromises at Democrats’ expense -- the biggest being that no immediate raised revenues are part of the terms.
The deal includes a $2.1 trillion heightening of the debt limit, an immediate $1 trillion in deficit-reducing spending caps equally split among defense and non-defense discretionary spending, and then the formation of a congressional bipartisan committee who will devise a plan for $1.5 trillion in additional deficit reduction measures. If the committee fails to achieve this plan by Thanksgiving, then automatic across-the-board spending cuts would kick in in 2013 -- excluding cuts to Social Security, Medicaid, most of Medicare, and many important low-income programs.
Democrats and Obama have pushed for tax reform and raising revenue to be a part of any debt ceiling-raising or deficit reduction deal. In the current plan, that is possible if the special committee is able to incorporate it into their Thanksgiving plan. It’s also possible if the Bush tax cuts to the wealthy are allowed to expire at the end of 2012.
But its the huge amounts of spending cuts upfront that has rankled many Democrats, particularly those in the Congressional Black Caucus. Rep. Emanuel Cleaver, the CBC chair, called the deal a “sugar-coated Satan sandwich.”
Many have said that this last-minute compromise didn’t need to be. There was an opportunity last December, during the lame-duck session when Democrats were Congress’ majority, when debt ceiling measures could have been dealt with during the clash over extending the Bush tax cuts, and allowing unemployment insurance to expire.
New York Times columnist Paul Krugman said: