11 O’clock Tick Tock
In a White House meeting intended to break the impasse, John Boehner, the Republican speaker of the House of Representatives, instead pushed for deeper spending cuts as part of a deal that would keep the government running past a Friday deadline, according to a Democratic source.
Though the two sides have been working for nearly a week on a package that would cut $33 billion from current spending levels, Boehner said he wanted that raised to $40 billion, the source said. Aides to Boehner declined to comment.
Democrats and Republicans had been at odds over just how those cuts would take effect, and now they must resolve the size of the cuts with only days to reach a solution.
Top lawmakers said they were losing hope that they can finalize a deal before funding expires at midnight on Friday.
"I am not optimistic, no I’m not," Senate Democratic leader Harry Reid told a news conference.
Republicans and Democrats are locked in a game of brinkmanship over how to fund the federal government for the final six months of the 2011 fiscal year. Republicans are eager to fulfill a campaign promise to scale back government, while Democrats say sharp spending cuts could hurt the fragile economic recovery.
In Washington D.C., the talk here is about 11th hour talks to avoid a government shutdown. It seems all but certain now. This issue has been brewing since the midterm election. I said then that:
it does no good for the Republicans politically to compromise with President Obama. His policies are rightfully seen as failed. The right thing to do politically (but not morally) is to try and strike as much contrast to the President as you can, especially if it makes him look more failed. So that means favouring gridlock and pushing deficit reduction, looking for spending cuts and so on – even if it leads to a government shutdown stare-down as it did under Clinton. Is this the right thing to do? I don’t think so, if only because it reduces the number of potential positive economic outcomes.
So that’s where we are right now in the U.S.. Remember, we’re talking about $40 billion in a budget of nearly $4 trillion. It’s not like this a real debate over the issues that actually matter like military spending and entitlements. That’s where the real fiscal discussion is. This is just Kabuki Theater.
At a minimum, this will be a disaster for state and local government s dependent on transfer payments. There is the possibility if this gets out of hand and spooks business, that it crimps economic growth, nascent job growth, and that this leads to a double dip recession and a debt deflation. Who gets blamed for that? I think the whole thing shows a recklessness in American politics that should be rewarded with a sovereign debt ratings downgrade. This is the sort of irresponsible brinkmanship that you don’t see in other developed countries – even Belgium. For me, it is a clear sign of the decay of American governance and the political system.
Anyway, I got the 25th Anniversary Under A Blood Red Sky U2 video last night and it is a brilliant piece of cinema showing U2 at their concert best on the dawn of super stardom in 1983. These guys look impossibly young. Bono has an androgynous earnestness that is captivating. He is sporting a Robert Smith-style ‘Flock of Seagulls" hairstyle. Adam Clayton has a weird perm and hair dye thing going. The Edge and Larry Mullen look very cool. It’s all very 80s and very wonderful too.
So I thought I’d cue up the video of 11 O’clock Tick Tock from that concert as a night time ode to the dysfunctionality of the American government.