Sunday, July 24, 2011

UPDATE: Latest news on debt ceiling crisis.

Boehner sees Two-Tier Deal:

Firedog Lake says Boehner is going to try to force the Democrats and the White House into accepting a two tier deal that could be announced this afternoon after a 4:30 Eastern time meeting of Republicans in the House:

In the first tier, the $1.5 trillion in agreed spending cuts would be executed, along with a $1.5 trillion increase in the debt limit. In the second tier, there would be a “Super Congress” created…whose recommendations on entitlements and taxes would be fast-tracked to the floor of each chamber for an up-or-down vote. The debt limit would be raised after those recommendations were delivered to Congress and voted upon.  [See the explanation of the Super Congress idea below] 

Huffington Post explains the idea of a Super Congress:

This "Super Congress," composed of members of both chambers and both parties, isn't mentioned anywhere in the Constitution, but would be granted extraordinary new powers. Under a plan put forth by Senate Minority Leader Mitch McConnell (R-Ky.) and his counterpart Majority Leader Harry Reid (D-Nev.), legislation to lift the debt ceiling would be accompanied by the creation of a 12-member panel made up of 12 lawmakers -- six from each chamber and six from each party.

Legislation approved by the Super Congress -- which some on Capitol Hill are calling the "super committee" -- would then be fast-tracked through both chambers, where it couldn't be amended by simple, regular lawmakers, who'd have the ability only to cast an up or down vote. With the weight of both leaderships behind it, a product originated by the Super Congress would have a strong chance of moving through the little Congress and quickly becoming law. A Super Congress would be less accountable than the system that exists today, and would find it easier to strip the public of popular benefits. Negotiators are currently considering cutting the mortgage deduction and tax credits for retirement savings, for instance, extremely popular policies that would be difficult to slice up using the traditional legislative process.

Tea Party scheme to avoid default without raising debt limit

In case no deal is struck and the debt ceiling isn’t raised, The Hill says Tea Party Repubs are seeking to pass law prioritizing what bills the Treasury would be required to pay first out of available revenue:

Members of the Senate Tea Party Caucus have met with House freshmen to discuss a plan to pressure House Speaker John Boehner (R-Ohio) to bring the Full Faith and Credit Act to the floor. 

The legislation would direct Obama to prioritize federal payments to the nation’s creditors, Social Security recipients and soldiers serving in Afghanistan and Iraq. 

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