When House Republicans return from recess next week, one of their top priorities will be charting out the next fiscal battle—the debt ceiling.
Tea party members view this as a key time to extract serious cuts to entitlement programs from President Obama and the Democrats. “This is going to be where the rubber meets the road,” Rep. Tim Huelskamp, R-Kan., said before Congress left Washington roughly two weeks ago.
The trick for the Republican caucus will be holding together its members; maintaining some leverage over the negotiations; and simultaneously, not allowing the party reputation to be damaged by any fiscal brinksmanship, or by failing to raise the debt ceiling and defaulting on the nation's debt.
While the appetite seems low for a massive showdown like the debt-ceiling fight of the summer of 2011, particularly as the Republican Party does some soul-searching on how to best present itself on fiscal and economic issues, House Republicans have continued their aggressive rhetoric. Extracting “dollar-for-dollar [spending cuts] is the plan,” House Speaker John Boehner told reporters just before recess. Huelskamp is quick to say that he and his fellow tea party members want a debt-ceiling compromise to include cuts in funding or major structural changes to Medicare, Medicaid, the Affordable Care Act, and food stamps.
Indeed, House Republicans are approaching the debt ceiling with a renewed measure of confidence. They think the White House botched the sequester negotiations by painting the across-the-board spending cuts as dire economic bombshells that would hit in early March. So far, the cuts have not caused any major economic damage, though forecasters have always predicted that the full weight of the cuts would not be evident until July or August.
"The hyperbole surrounding the sequester and the way the White House played it out was surprising to me. Their ability to lead right now is really diminished," Rep. Peter Roskam, R-Ill., told National Journal Daily.
Republicans also managed to stay united during the fiscal battles of late: a sequence that moved with relative ease from the sequester, to the passage of the House Republican budget, to the approval of a continuing resolution to keep the government funded through the end of the fiscal year in September. The debt-ceiling debate, set to crescendo in July, is the final chapter in this act.
"You've got to go back and look where we started," said Rep. Jim Jordan, R-Ohio, at a recent informal "Conversations with Conservatives" luncheon. The Republicans have come back, he said, from the lost presidential election and the fiscal cliff’s failed Plan B, Speaker Boehner's attempt to present alternative legislation that ultimately did not have enough votes to pass in the House.
"It looked then like the momentum was all in the president’s favor," Jordan said. "Now, we have the Senate doing a budget. The sequester has locked in $85 billion in savings for taxpayers, and a [continuing resolution] will make sure that stays in place.... The momentum is starting to shift."
Of course, Democrats say otherwise, arguing that the slow economic impact of sequestration and the Republicans’ emphasis on spending cuts will come back to haunt them politically. As the White House’s top economic adviser, Gene Sperling, said at a recent economic summit sponsored by The Atlantic: Don’t think the sequester cuts occurring is a win for Republicans.
"They are for higher defense spending. This deeply cuts defense spending," Sperling said. "They say they are for long-term entitlement reform. You know how much long-term entitlement reform is in the sequester? That would be zero. There's a 2-percent across the board on Medicare and then, at 10 years, it ends. So, what is it that anybody is achieving from this?"
That will be the question hanging over the spring, as the two parties contemplate their best approaches to the debt ceiling, and as they continue to see if they can negotiate even a small-scale budget deal.
This article appears in the April 5, 2013 edition of NJ Daily.