Wednesday, July 20, 2011

UPDATE: Debt crisis—Where we stand now.

Yesterday, in a major blow to the McConnell Back-Up plan, 60 House Republicans delivered a letter to Speaker John Boehner asking that the McConnell plan not even be brought up for a vote. Also, the Tea Party groups Freedom Works and Club for Growth are threatening the Republican Party if it goes along with a deal like the McConnell plan.

Brian Montopoli at CBS News, Political Hotsheet, has this to say about the current status of the debt crisis discussions.

So here's the current state of play: The proposed "grand bargain" plan (Gang of Six-type deal) has renewed momentum but uncertain prospects. The prospects for the proposed McConnell back-up plan appear to be diminishing as the Tea Party asserts its authority. And there are just a few days left before the July 22 rough deadline that Democrats say the framework for a deal must be in place in order to get it through Congress by August 2. 

Meanwhile, Republicans appear to be boxed in by their alliance with the Tea Party and related promise not to agree to a deal that increases revenues even one penny. Unless Democrats agree to a deal in which they essentially make all the concessions - an unlikely prospect - Republicans will need to agree to raise at least some revenues if they want a deal. And that could prompt an angry response from the Tea Partiers who helped them win back the House in 2010.

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