Update on GOP Debt Limit Strategy

I put a short post on Wednesday that the Republicans ought to get a little something out of the debt limit rise.  Keith Hennessey has an Op-Ed at the WSJ that lays out an even better strategy.  The whole thing is worth a read, but the gist of goes like this:

1. Obama can have a choice of real spending cuts and he gets a long term debt limit rise.  Alternatively, he can have a three month debt limit increase, if he doesn't want to get serious.
2. Republicans would only guarantee enough votes to allow the measure to pass, making Democrats responsible for raising the ceiling.  To date, House Democrats have been shielded from this bit of unpleasantness.

Keeping the focus on the debt every three months will suck the air out of any other Obama agenda item.  So will meaningful spending reductions.  Both options are great.  I doubt the GOP will be that smart.

John Boehner Leverage the Debt Limit

John Boehner went into the belly of the beast, figuratively speaking, telling Wall Street types what the GOP is demanding in exchange for raising the debt ceiling. The always left of center LATimes has the details.

Boehner told the Economic Club of New York that there would be no increase in the debt ceiling unless certain conditions were met. He demanded $2 in spending cuts for every $1 the debt ceiling was raised, specific spending reductions rather than targets, and no tax increases. That sounds like he's picking a fight with Democrats, not demonstrating fiscal responsibility.

Good for him. This is a fight that needs to be picked. The WSJ had a decent editorial take on the issue.

"It's true that allowing America to default would be irresponsible," Mr. Boehner told the New York Economic Club. "But it would be more irresponsible to raise the debt ceiling without simultaneously taking dramatic steps to reduce spending and reform the budget process."
. . .
The real question isn't whether the U.S. will meet its debt obligations but what the government will do to control its spending habits. Federal debt held by the public—the kind the government has to pay back—as a share of GDP has soared in the Obama years and is now near 70% and rising. No one knows when the world's creditors will lose their appetite for U.S. debt, but no nation should want to tempt fate.

Boehner continues to do a creditable job of keeping the focus on reducing government. I know he has come in for criticism for not cutting enough, but we are trending in the right direction.