Without going over the whole deal (I'm hoping you can get that information elsewhere), I thought I'd point out a few things that I find interesting. Unless otherwise noted, all quotes are from the White House Fact Sheet on the deal.
First of all, the spending cuts are timed to avoid harming the recovery.
The deal includes a mechanism to ensure additional deficit reduction, consistent with the economic recovery. The enforcement mechanism would not be made effective until 2013, avoiding any immediate contraction that could harm the recovery. And savings from the down payment will be enacted over 10 years, consistent with supporting the economic recovery.
Secondly, the initial phase of spending cuts are the same ones that Biden had agreed to when Cantor walked out on the negotiations.
Thirdly, if the committee put in place to find a balanced approach to deficit reduction is not successful, the spending reductions will hit the Pentagon pretty hard. Here's what Ezra Klein says about that.
In the initial $900 billion in cuts, almost half will come from “security spending” (which includes defense, homeland security, veteran’s benefits, the State Department, etc). Defense is the big money there, and, according to the White House’s fact sheet, it will take a full $350 billion in cuts on its own. But the real hit comes in stage two: if the second round of deficit reduction isn’t signed into law, the “trigger” that will make automatic spending cuts absolutely savages defense spending.
As Phillip Klein says, that sets up an interesting development for conservatives.
President Obama said during his brief remarks tonight that he would continue to push for a “balanced approach” (i.e. higher taxes). No doubt, Democrats on the Congressional committee will be insisting on raising taxes as part of deficit reduction, and Republicans will be torn in both directions. Either they agree to tax increases, or they trigger automatic defense cuts on top of the cuts that they already agreed to.
No doubt, we’ll start to see more and more opposition from conservative defense hawks to slashing the military budget, while the Norquist crowd will continue to push Republicans to accept more defense cuts to avoid any increase in taxes.
Now that should be fun to watch!
In addition, the triggered cuts to other spending are limited.
Consistent with the bipartisan precedents established in the 1980s and 1990s, the sequester would be divided equally between defense and non-defense program, and it would exempt Social Security, Medicaid, unemployment insurance, programs for low-income families, and civilian and military retirement. Likewise, any cuts to Medicare would be capped and limited to the provider side.
Not only are Social Security, Medicaid, etc. exempt from cuts, the ones allowed for Medicare would be capped and limited to providers. So there will be NO cuts to Medicare recipients and the cuts to providers will be capped at 2%.
Finally, you'll hear a lot of talk about how the deal doesn't include revenue increases. That's bullsh*t. If the committee doesn't include adequate balance between spending cuts and revenue increases, President Obama has reserved his own trigger.
The Bush tax cuts expire as of 1/1/2013, the same date that the spending sequester would go into effect. These two events together will force balanced deficit reduction. Absent a balanced deal, it would enable the President to use his veto pen to ensure nearly $1 trillion in additional deficit reduction by not extending the high-income tax cuts.
Yeah, I was right on that one. President Obama never took them off the table.
So there are some talking points for you to use when you hear that this deal was all one-sided. Don't let the motherf*ckers get you down!
Tax cuts tied to defense spending is a coup!ReplyDelete
Meant tax increases!ReplyDelete
Obama had to fool the liberals into believing he was screwing them. As soon as the Republicans saw them squirming they took the bait. Hook line and sinker. This is a good plan that forces the Teabangers to put their money where there mouth is. I was on to it early on. Great reporting.ReplyDelete
I read where someone said that President Obama won't be selling this too hard until the vote gets through the House. Knowing how your opponent operates allows you to figure out how to play them.
You are missing the point. The conversation should be about jobs. Most economist say these cuts will hurt the econmy. Cuts are Repub talking points & Obama is echoing them.ReplyDelete
The repubs wanted this deal all along. All Cuts, No Taxes. The other stuff (Social Security, Medicare & Medicare) was just theatre & would have been a bonus.
Also, This deal is the exact opposite of what Obama "told us" he wanted. This means that Repubs got everything they initially wanted and Obama got nothing. Then he calls it "compromise". Then people say at least we still have SS, Medicare & Medicad.
We've heard a million times about how Obama will raise taxes on the Rich. It's always sometime in a future that never seems to happen. He has no credibiliy on this issue.
Did you read what I wrote?
This deal is obviously NOT "all cuts, no taxes."
Cuts don't happen for 18 months or more.
If you can lay out any ideas on how to get something through Congress on jobs...I'm all ears.
The conversation should be about jobs. That is correct and the Republicans are doing everything they can to avoid jobs, they have jobs. Jobs is the only thing left in Obama's way to reelection. READ it again. The cuts are by default to the bloated defense budget. Otherwise they have to raise taxes. Democrat have to agree on any cuts they bring to the table. Checkmate. It is a lose lose for them.ReplyDelete
I went to bed knowing PBO had struck a fab deal w/o even seeing the details. It reminded me of the Bin Laden affair. He was tired but lethal cool last night. I thought to myself he got them, a bullet between the eyes. I love this man!
I thought to myself he got them, a bullet between the eyes.ReplyDelete
I'm not laughing...But I am! :)
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The above comment was removed for references to apologists and Orwellian speak. If we can't talk with respect, I'm not interesting in talking.ReplyDelete
Was the anger really about the analysis or what President Obama accomplished? Did you see Gabby Giffords return to the House and cast her vote? Wow! The amazing grace of God!ReplyDelete
SouthernGirl2 - it was directed at the analysis. I'm not going to play that game here.ReplyDelete
And yes, I saw Gabby - got misty over that one.
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Obama has been pushed down and had his lunch stolen before. This time he planted a crap sandwich and pretended to cry while the GOP ate it. Obama win.ReplyDelete
good article, ....THANKS FOR SANITY....however, you know those "doomsayers" (against this President) will always.....find a way......but "the DAM was faulty", "burst" and flooded "Congress"....(LOL....watch EVAN ALMIGHTY" MOVIE....you'll get it.....ReplyDelete