When Speaker John Boehner and President Barack Obama cut their deal in April on a continuing resolution to fund the government for the remainder of fiscal 2011 at a level only $78.3 billion below what Obama had originally requested for the year, it should have been obvious Boehner would come back and cut a similarly bad deal to increase the debt limit.
In the April CR, Boehner agreed to a level of federal spending that predictably required running a massive deficit in this fiscal year -- which ends on Sept. 30.
When the White House Office of Management and Budget published Obama's fiscal 2012 budget on Feb. 14, it included an estimate of the fiscal 2011 deficit the government would run under Obama's proposal. It was $1.645119 trillion.
Cutting $78.3 billion from what Obama planned to spend in fiscal 2011 would have left a deficit of 1.566819 trillion.
Now, let's do some arithmetic.
On Oct. 1, 2010, the first day of fiscal 2011, the portion of the national debt subject to the statutory limit stood at $13.510840 trillion. By April 14, 2011, the day Boehner pushed the CR through the Republican-majority House, the debt subject to the limit had grown to $14.218621 trillion.
That meant the debt had increased $707.781 billion up to that point in the fiscal year.
Subtract that $707.781 billion from the $1.566819 trillion in deficit spending that would result over the course of the full year as a result of the Boehner-Obama CR deal (using the OMB's deficit projection as the baseline), and you get about $859.038 billion in anticipated 2011 deficit spending that had not happened yet (assuming that deficit spending and federal borrowing run more or less in tandem).
However, when the House approved the Boehner-Obama deal on April 14, the federal debt of $14.218621 trillion was just $75.379 billion below the legal debt limit of $14.294000 trillion.
To engage in the approximately $859.038 billion in additional fiscal 2011 deficit spending anticipated by the Boehner-Obama CR deal -- assuming OMB's deficit projection -- would require lifting the debt limit by $783.659 billion ($859.038 billion minus $75.379 billion) just to give the government the borrowing authority to get through Sept. 30.
In other words, assuming OMB's fiscal 2011 deficit projection was accurate, Boehner was implicitly agreeing to lift the debt limit by about $783.659 billion when he agreed to a CR that set spending for this year at a level just $78.3 billion below what Obama had originally requested.
Is this too harsh an analysis? Perhaps.
The day after the Boehner-Obama CR deal passed the House, the Congressional Budget Office published its own updated analysis of Obama's budget proposal. It estimated a fiscal 2011 deficit of $1.399 trillion -- significantly lower than OMB's estimate of $1.645119 trillion.
Assuming again that federal borrowing will roughly equal federal deficit spending, a fiscal 2011 deficit of $1.399 trillion would have required the Treasury to borrow approximately another $691.219 billion above the $707.781 billion it had already borrowed in fiscal 2011 as of the close of business on April 14.
The CBO said in its report estimating a $1.399 trillion 2011 deficit that it had not included in its calculations the recent continuing resolutions to fund the government.
So, subtract the $78.3 billion in cuts included in the Boehner-Obama CR deal from the $691.219 billion in additional borrowing needed after April 14 to cover a $1.399 trillion deficit, and you get $612.919 billion.
Subtract from that $612.919 billion the $75.379 billion in room still left under the debt limit as of April 14, and that leaves $537.54 billion.
Thus, even using CBO's more optimistic deficit estimate, it would have been reasonable to assume that the Boehner-Obama CR deal was going to require lifting the debt limit by approximately half a trillion dollars just to carry the government through Sept. 30.
What did Boehner get in return for this?
He did not insist that the April CR include language prohibiting funding for implementing of Obamacare, or defunding Planned Parenthood (the nation's largest abortion provider) or the Corporation for Public Broadcasting (which subsidizes liberal media). Nor did he extract any commitment from the president to reform entitlement programs -- including Medicare, Medicaid and Social Security -- that are the primary forces driving the nation toward bankruptcy.
In the recent debt-limit negotiations, Boehner could have said to Obama: We will increase the debt limit just enough to cover the fiscal 2011 spending we agreed to in April's CR. But for fiscal 2012 we will not agree to business as usual on government spending and debt. The Republican-controlled House will pass a series of appropriations for fiscal 2012 that significantly reform government spending and reduce government. We will be happy to debate them with you in September.
Instead, Boehner agreed to increase the debt limit by $2.4 trillion -- the largest debt limit increase in history.
House Minority Leader Nancy Pelosi, D-Calif., who supported Boehner's deal, predicts the $2.4 trillion increase will last 18 months -- enough to get past next November's elections. Now do this math: $2.4 trillion over 18 months equals $133.33 billion in new debt per month or $1.596 trillion in a year.
A speaker who cuts a debt-limit deal like that is not planning to fight over the 2012 appropriations bills. He is planning to cut another deal.
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