Debt Deal: Winners and Losers

by on August 4th, 2011

During the contentious negotiations leading to the final deal, a re-orientation of the starting point for developing future federal budgets seems to have occurred. Instead of an emphasis on appropriations and earmarks, with ever-growing federal programs, Congressional budgets may now begin with program cuts.

President Obama did not break the tea parties by forcing the Republicans to accept new tax revenues but the president did get a deal that pushes the deficit ceiling beyond the 2012 election.

Now, if Obama can line up a few Democratic votes in the House to replace unhappy tea party Republicans, he will sign the deal into law. House Minority Whip Steny Hoyer, as good a vote counter as anyone in Washington, predicts that more than 60 Democrats will buck Minority Leader Pelosi and back the deal.

Senate Minority Leader McConnell can take credit for drawing the White House into negotiations at the critical point. Speaker Boehner can take credit for navigating his plan through the House, which forced the president to abandon his attempts to jam new taxes into the final agreement. Senate Majority Leader Reid will take a share of the credit even if it appears that the GOP negotiated directly with the White House throughout Saturday and Sunday, with Vice President Biden a bigger part of the negotiations than anyone realized or anticipated.

And the president, with his bully pulpit, will take and get credit.

Grover Norquist will get credit for setting the agenda: No new taxes. His importance in budget issues will grow. The tea parties will be emboldened but at the risk of continued defections among independent voters who have been turned off by the inflexibility of many tea party-backed House members.

Perhaps only the liberals in the House Democratic leadership will not be able to crow.

Oh, we the people can’t crow. We have seem our retirement accounts drop and we may still see a downgraded debt rating resulting in higher interest rates. We the people need to keep Washington on a shorter lead.

Kenneth E. Feltman