They finally have a deal, but many of us will not be happy with it. It's a 2 step deal. $400B in credit is available right away, with $900B total in the first installment, raised by President Obama with Congress being able to vote against it but the President would veto their disapproval and they would not have the votes to override. When that runs out, there will be another $1.2 to $1.5 trillion, again with Congress only able to disapprove and the President able to veto their disapproval. This allows all the Republicans to vote against raising the debt ceiling while still getting it done. At the time of the second stage, a special Congressional Committee of 12 members would be created to cut the deficit by an equivalent amount. If the Committee can't agree on the plan, Congress would either have to accept a balanced budget amendment or there would be across-the-board cuts in spending. The cuts would come from defense and cuts to Medicare would be capped, with additional cuts to education and transportation, while Social Security and other programs would be exempt. The defense cuts would be massive. And you can bet that the Committee's plan will not satisfy the GOP if it includes revenue enhancements, and the Dems are going to be mighty angry if it doesn't -- and if they don't have the votes, we have cuts of unprecedented levels to Medicare, education, and defense -- right before the Presidential election. Here's a graphic showing who got what, and who gave what. And here's an analysis of the winners and the losers. And here's how the White House frames the agreement.
It sure looks to me like a GOP win. I don't see anything that says that any part of this has to come from revenue raising or an overhaul of the tax system. The President says the Congressional Committee in charge of lowering the deficit could do so in part through taxes. However, Speaker Boehner will still have a tough time getting the votes -- he did not get a second debate 6 months from now, like they wanted. He may lose the Tea Party, so he will have to pick up enough Dems to pass this. But Nancy Pelosi hasn't yet pledged her support. They have to get the deal on paper and voted on by Tuesday in order to avoid a debt default. Still, the President will face opposition from his base. But with both sides grumbling, that may mean this is a good compromise -- everybody gave up something that mattered to them.
It seems, though, that much of the damage to the economy is already done. USA Today says the deal harms both President Obama and Speaker Boehner. Our ability to lead the world is in serious question since we can't even lead ourselves, although Asian and European markets are surging. And cutting spending in a bad economy is, according to economists (and me), the exact wrong thing to do when what we really need is an influx of cash. Indeed, our credit rating may still be cut. But Wall St. is optimistic now that there won't be a default. Did President Obama give in, or was this cagey politics? Paul Krugman says the President surrendered. I hate to say it, but I think I agree. Still, lots of GOPers are unhappy -- as are lots of Dems.
I'm not happy about this deal. I think the President gave too much. I also think there was no chance of getting something through the House or the Senate that didn't have at least some Republican support. So maybe this is the best that could be done while still avoiding a default. If that's true, then we better hope that the votes are there. Votes should come today.
There's still other news.
Health reform implementation is happening, as we start to see how the theory of it actually works in practice. Meanwhile, Politico has run a bunch of opinion pieces. Paul Ryan hates health reform, as we already knew. Nancy-Ann DeParle heads the White House reform office, so she's in favor. GOP-er Joe Pitts opposes. Don Berwick -- head of the Centers for Medicare and Medicaid Services -- is in favor. And a center-right group is working on an alternative if the health reform law is repealed.
The Administration has provided $71 million in grants for nursing to encourage people to join the nursing profession.
Medicare will begin penalizing hospitals for readmissions.
Many medical devices are not tested before they're approved because they're similar to already approved devices. Some are critiquing this system. What would be a better approach?
A hospital here in Connecticut is serving gourmet food at affordable prices, defying the stereotypes of hospital cafeterias.
A group of doctors says hot dogs are as unhealthy as cigarettes.
Have a great day! Jennifer