Katie posted this Capitol Hill rumor earlier, and it has since been confirmed by a number of House Republicans as they emerged from this morning's full conference huddle. The top line update is that Boehner's debt plan has been revised (again), this time to include a Balanced Budget Amendment (BBA) trigger at a key stage of his broader proposal. NRO's Kathryn Lopez has the broad outline:
This is how the Speaker’s office explains the new version of the Budget Control Act:
- Bill currently has a two-step process for raising the debt ceiling.
- As currently written, before POTUS can request second tranche of increased debt authority, Select Committee must produce spending cuts larger than the debt hike.
- Change to bill would specify that before POTUS can request second tranche of debt authority, Select Committee must produce spending cuts larger than the hike AND a Balanced Budget Amendment must be sent to the states.
'Cut, Cap, and Balance' lives! Except, in reality, it doesn't. I'll explain why in a moment. The immediate consequence of this change is that Boehner's plan will easily pass the House, probably along party lines. A vote is expected tonight. Most GOP "no" votes will flip to "yes," now that the plan includes some additional, albeit fanciful, budget-cutting muscle. The BBA provision makes Boehner's proposal even less palatable to Senate Democrats, but then again, they were pledging to kill it even before this new element was added.
So where do today's developments leave us now? The Boehner plan will pass, and will be tabled -- ie, killed -- in the Senate. Next, Harry Reid will (supposedly) finally move on his own plan. Its fate is uncertain. Will Senate Republicans block it? Could it pass -- but with the clear understanding that it's DOA in the House in its (seriously flawed) current form -- prompting a makeshift conference committee to iron out the differences? Some senior Republican aides believe Reid may actually decide to hold off on filing cloture until a new round of discussions with Republicans occurs, and the bill is changed. However this step ultimately plays out, it's probable that a final compromise bill will emerge from the Senate over the weekend.
In the interim, Republicans will accurately argue that they've offered three separate debt solutions, compared to Senate Democrats' and President Obama's combined zero. Liberals will counter that Boehner only managed to ram his party's most recent plan through by bundling in a huge pander to the Tea Party. Conservatives, in turn, will (and should) point out that this "pander" is supported by 74 percent of the public.
What happens next? [Warning: If you aren't a fan of conjecture, read no further]. This is my best analysis, informed by a series of discussions with Capitol Hill staffers: Mitch McConnell will use any leverage he and Speaker Boehner have amassed (I'd argue that leverage has been slightly diminished, since Boehner had to resort to a gimmick to pass his own plan through the House) to strengthen and improve Reid's bill as much as possible. In this final negotiation, Democrats' top concern will be protecting the president by ensuring the final deal clears the debt ceiling decks until after 2012. For their part, Republicans will fight for the deepest cuts possible, and perhaps a guaranteed vote on a BBA in the Senate. The resulting deal will likely be unacceptable to some House Republicans -- especially those who are, or were, "no's" on the Boehner deal. It will still pass the House, however, because Pelosi will be instructed to release her caucus to give Boehner the votes he needs to cobble together a majority. The president will sign the bill, all sides will try to declare victory, and this ordeal will be behind us. At what cost, and for how long, remains to be seen.
No one will be fully satisfied. President Obama and Democrats will have gritted their teeth and temporarily suppressed their obsession with job-killing tax hikes. They'll also have agreed to more cuts than they'd have preferred -- namely, none. They may even be dissatisfied with the timing element of the deal, depending on how it shakes out. Conservatives won't be happy with it because the cuts still won't be sufficiently front-loaded, real, or guaranteed. Dreams of a required balanced budget amendment trigger will be dashed -- which may not be a bad thing. Why? Because according to multiple reports, Boehner 3.0 does not specify what form of BBA is on the table. The 'Cut, Cap, and Balance' version of a BBA included key safeguards against the possibility of the amendment being exploited to force tax increases. Among other things, it placed a cap on how much the federal government could spend as a percentage of GDP (about 20 percent), and it locked in a 2/3 majority threshold to raise taxes. The BBA now under discussion strips out all of those taxpayer protection provisions, rendering it "clean." Dave Weigel thinks Democrats still won't bite on a "clean" BBA, but I'm not sure the GOP should tempt fate on that proposition.
If, at the end of the day, the final deal precludes tax increases and establishes cuts that exceed the total dollar amount of the debt ceiling increase, Republicans -- and the American people -- will have won. Sort of brings new meaning to the term "winning ugly," doesn't it?
UPDATE - Speaking of ugly, Gallup's daily presidential tracking poll pegs President Obama's job approval at 40 percent, with 50 percent disapproving -- an all-time low. This survey is of adults, which as we've discussed previously, is a sample that tends to be more favorable to Democrats than registered or likely voter models. Between this poll and the atrocious GDP numbers, today is not a happy Friday in the West Wing.