Tuesday, July 19, 2011

How the Constitution structures the debt crisis

Sandy Levinson

There are two distinct ways in which one has to understand how the Constitution strucures the current crisis. One obviously involves our tricameral legislative system and the fact that all three branches of the legislature--i.e., the House, the Senate, and the President--have to agree in order to get any legislation at all. So, as senators and the President are apparently giddy about a compromise reached by the Gang of Six that, according to NPR, could actually get the support of over 60 senators (i.e., a filibuster-proof majority), there is still the House, and whether Eric Cantor and his Tea Party minions will indeed capitulate and accept even one cent of added revenue. In the alternative, the question may be whether John Boehner junks the pernicious "rule" adopted by Dennis Hastert by which he refused to bring any bill to the floor of the House that didn't have the support of a majority of the Republican caucus (even if, by stipulation, it had the support of a majority of the House in general, once one added Democratic votes to a minority of the Republican caucus).

But there is a second way in which the Constitutionis at the heart of this imbroglio. As Obama well realizes, a "grand compromise," however much it will make political liberals unhappy, will absolutely assure his re-election, probably with 55% of the popular vote. That would probably be true if the Republicans had a truly serious candidate running for the office. But, note well, all of the current candidates, including Mitt Romney, have basically opposed any of the necessary compromises to get a grand bargain. Will Romney engage in another flip flop? Republicans, including, of course, Mitch McConnell have been obsessed with making Obama a one-term president not simply because it's a pretty important office, but because the Constitution, with minor exceptions, gives the President a "winner-take-all" control over the executive branch. This is totally different from 48 of the 50 states, which have rejected the "unitary executive" by allowing people to elect governors and other executive officials from different political parties. And, of course, even if they're from the same party, they may be rivals.

So the question before House Republicans, especially, is whether they are willing to compromise and erase the lines that Eric Cantor and others have drawn in the sand and, even more to the point, whether they are in effect willing to make the greatest possible contribution to the Re-elect Barack Obama campaign.

So, if my analysis is correct, this is game, set, and match to Obama, unless, of course, the House Republicans do decide that to play the role of Samson and take the entire economy down, either because they really are principled--which is hard to believe re Cantor, who has voted for 11 debt increases--or believe, I think wrongly, that Obama will be more blamed than they for the collapse and the horrendous unemployment it will create. The grand bargain, of couse, also means shelving the idiotic Balanced Budget Amendment being advocated by House Republicans. The best explanation of its idiocy, incidentally, is a posting by the Washington Post's moderate (if not conservative) economics columnist Robert Samuelson.


"and the fact that all three branches of the legislature--i.e., the House, the Senate, and the President"

I'm flabbergasted. Do I really have to point out that the President heads up the legislative branch, and the legislature has only two chambers?

Executive Branch, Brett.

Yeah, I was so flustered by Sandy writing that the Presidency was a branch of the legislature, that I wrote the wrong word.

Great blog Sandy. I wish there was a facebook link so I could share it with my 2000 followers.

They may declare they are cutting the deficit for FY12 but just wait. It will be almost impossible unless tax revenues are increased right away which isn't going to happen. It is going to be almost impossible to cut it next year politically. Before they even start built into the CBO projection of $1.1Trillion vs 11's $1.6 are cutting medicare doctor reimbursements 50%, ending the FICA 2% tax holiday, ending extended UE, only partly bailing out the GSE's which will mean perhaps default on their MBS's, slashing grants to states. All that is built into their baseline of FY12 1.1t which assumes $2.5t revenue when it is running at only $2.1t now.

They will probably announce they will achive a FY12 deficit of $800bn. That would be a cut of 50% of this years, 5% of GDP. Cutting 5% of GDP means recession.

Anyway, setting aside that bizarre terminology of Sandy's, in my experience all compromises arrived at by "gangs of" suck. This appears to be no exception: The "Gang of Six" compromise supposedly involves spending cuts. However, they are typical Washington baseline spending cuts. Which is to say that they've taken somebody's wish list for spending increases, tacked it on top of supposed temporary peak stimulus spending levels, and since they project spending less than this artificially inflated number, their increase in spending is portrayed as a cut in spending. Kind of like when a store doubles their prices for five minutes before announcing a 40% off sale.

That bit of dishonesty alone signals that the proposal isn't serious. But, of course, it's not meant to seriously deal with anything except the need for the next borrowing fix.

If the President didn't have that pesky veto/approve requirement outlined in Article I, he'd be divorced from legislation altogether. As it stands, the President is part of a legislative process that has three parts. That's not a bizarre idea if you think about it.

I can understand a desire for consistent language ("branch" is customarily used with executive, legislative, judicial in these discussions), but the meaning of the word still applies in this case. No reason to be flabbergasted, methinks, although the reaction does argue against the superiority of textualism... :)


President Obama has never offered and will never accept any "grand compromise" with actual significant cuts in spending in the next administration he hopes to win in 2012.

The last actual budget Obama issued was the FY2011 budget last year with further spending increases that went down 97-0 in the Senate.

The deficit reduction speech Obama gave lacked any specifics and was backloaded about a decade into the future. When asked by the House Budget Committee to score the Obama outline, the CBO chief famously replied: "We don't score speeches."

The most recent spin was the Dem media stories that Obama offered a "grand compromise" with entitlement reform and just an itsy bitsy tax increase. Obama never actually offered even a speech outlining this alleged "grand compromise" and the GOP members negotiating with Obama said he refused to talk about actual entitlement reform.

Afterward, Obama told Congress to come up with something, again without offering anything himself.

As for your day dream about Obama winning a 55% landslide victory next year, during this "grand compromise" spin, Obama's approval ratings have gone down to the low 40s, he is losing badly to a generic GOP candidate in the Gallup poll and the GOP's lead in the congressional generic is back up to 6 points in the Rasmussen poll.

They say they can reduce the deficit in FY12, but wait a bit. It would be almost impossible, unless revenues are increased by the same, which will not happen. It would be almost impossible to cut next year politically. Before starting the projection included in CBO 1.1Trillion $ vs $ 11 is 1.6, is to reduce Medicare physician reimbursements by 50% and ended holiday fica 2% tax ends extended EU, only partially GSE rescue, which means default on their MBS is cutting grants to states. All that is integrated into their FY12 baseline 1.1t which assumes income $ 2.5T when it runs at only $ 2.1t now.

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I'm flabbergasted. Do I really have to point out that the President heads up the legislative branch, and the legislature has only two chambers?

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