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A GOP House deal that solves everything, would force Reid and Obama to sign on, and saves our credit rating from downgrade

So let’s take everything into what is agreed on and the sticking points:

Points of Agreement

  • No taxes (with the exception of Obama)
  • Spending cuts (this one obviously could be argumentive as the Democrats really aren’t for spending cuts.)

Sticking points

  • The GOP wants another vote in 2012 to keep the spending/debt ceiling issue in front of Americans.  Obama and Reid want this to extend past 2013.
  • Immediacy of spending cuts.  Democrats want to back load them.  Boehner and the GOP certainly have this backloaded as well at least on their current plan.  The cuts have to be more immediate so the CBO can score this well enough to get conservative votes on board with the plan.
  • A balanced budget amendment vote to put Democrats on record.

This Will Be a Take It or Leave it Proposition to Harry Reid and Barack Obama

The way the deal is structured, Obama and Reid will have no room for a counteroffer.  Why?  Because our plan retains our AAA rating by structuring the guidelines that S&P/Moody’s gave.  CCB slashed spending by $5.8 trillion over 10 years with capping on spending at 18% GDP and pushed for a vote on a Balance Budget Amendment.  Okay, so here it goes.

The Deal

  • $4 trillion in cut spending over 10 years with increasing the debt ceiling by $2.5 trillion.  I’m not sure what would be cut.  Feel free to submit ideas that could be used to structure what programs/discretionary spending/federal agencies and programs could be cut.   What makes this a Take It or Leave it Deal is the $4 trillion over 10 years falls in the guidelines of the S&P and Moody’s rating agencies so our AAA rating will be preserved.  Also, there is a net spending cut here so this would project to the rating agencies that the country is serious about getting its financial house in order.  The GOP could claim that this plan would preserve our credit rating while Harry Reid’s would not.  The Democrats cannot counteroffer anything less because doing so would cause our credit rating to be downgraded.  If Reid counters with his own $4 trillion plan to offset the GOP plan, it would have to have tax hikes and Americans would not take to that at all.  If the Democrats trying doing a dollar for dollar ceiling increase for spending cuts, how do you think the American people are going to react to the Democrats wanting a $4 trillion dollar debt ceiling increase instead of $2.5 trillion?
  • The GOP would agree that this would be one vote and would take this off the 2012 election calender which is what Obama and Reid really want.  The cost?  $1.5 trillion in spending cuts.  However, we would be coming off $1.8 million from Cut, Cap and Balance and we would drop off the budget balance amendment for the time being.  We can debate the balance budget amendment during town halls and put it up after the 2012 elections since it’s almost 100% certain we’ll have Senate Minority Leader Harry Reid.

So Obama and Reid get the debt ceiling issue off the table for the 2012 elections.  However, they still have to answer for runaway spending w/exploding deficits, unemployments, inflation, Obamacare and a whole other slew of issues.  I like our chances in 2012.

This plan would be well good enough for conservatives for the time being.  We need a united House caucus behind John Boehner.  House Democrats would love the GOP congressmen to fracture because if this happens, we have Harry Reid’s plan and that would undermine our leadership and weaken our House majority.  Obama and Reid get what they want in getting the debt ceiling and balanced budget vote off the table for the 2012 elections.  We’ll take up this fight again after the 2012 elections many more times in the future until we get our country financially sound again.  Actually, I think this may be what Obama and Reid have been using the debt ceiling all along for.  To use default as a means of getting the GOP to go along with watered down legislation that will tick its voter base off so Democrats could regain the House and to use at as a means of strengthening Obama’s re-election chances.

In closing, the Democrats are going to counter that Boehner now moved the goalposts.  This will not be true.  The conservatives are not behind the two-tier plan so Boehner can simply tell the truth.  “I didn’t have enough votes to get my plan, so I decided to present a deal that meets all our goals, prevents a potential default, and puts this fight off until after the 2012 elections as President Obama and Harry Reid want.  We gave up some spending cuts from CCB as well to appeal to Democrats.”

It may take some time to structure this in a way where we could complete the legislative language by August 2nd but I’m sure the House could quickly pass a continuing resolution for a temporary increase in the debt ceiling to work out all the dirty details.  Actually, I have seen some reports that the Treasury has taken in more than projected revenue in which the date could be as late as August 10.  Plenty of time, Speaker Boehner and staffers, start writing it up!  However, there must be noticeable spending cuts up front, say $50-%75 billion in FY2012 and then work from there.

P.S. Speaker Boehner, make sure you get bills written right the first time so they score as they should with the CBO :)

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