The debt ceiling showdown may be coming to a close—at least for now—with President Obama's announcement of a new compromise deal Sunday night. America waits for it to be passed through Congress and braces for what could still be a credit downgrade for the United States, even with the deal. The compromise promises $1 trillion in cuts over the next 10 years already agreed upon by the two parties including $350 billion from the defense budget. In effect, the deal raises the debt ceiling by $2.1 trillion, putting off the need for another increase until at least 2013. It also creates a super committee of Congress made up of six Democrats and six Republicans whose task will be to find another $1.5 trillion in cuts to be passed by Dec. 23.
The bill will no doubt become an important talking point in the 2012 election—and an assortment of GOP contenders have already begun to criticize the deal. Soon after the president announced the deal in the Sunday evening press conference, Vice President Biden congratulated him, tweeting: "I'm proud of the President. Persistence. Compromise makes a comeback.—VP." In his press conference, President Obama was more tempered in his assessment of the deal: "Now, is this the deal I would have preferred? No. I believe that we could have made the tough choices required—on entitlement reform and tax reform—right now, rather than through a special congressional committee process." [Check out our editorial cartoons on President Obama.]
The deal did grant Obama one of his demands: it guarantees that he will not face the prospect of another debt ceiling crisis until after the next election. Not only will this stipulation help him politically, it will also assure the nervous marketplace that the threat of a default will not be coming any time soon. The president however did not get the revenue increases he wanted, and Republican Speaker of the House John Boehner told his caucus that they would not be on the table in super committee negotiations. However Democratic leaders insist that they may very well be. If the super committee cannot come up with a deal that can be passed by Dec. 23, a number of "triggers" are set that will cut $1.5 trillion directly from the budget—half of it from domestic spending, and the other from defense—starting in 2013.
With election season approaching, perhaps it is not a matter of who won the most with the compromise, but who lost the most—as nobody seems happy with it. Democratic House Minority Leader Nancy Pelosi did not throw her immediate support behind the bill: "I look forward to reviewing the legislation with my Caucus to see what level of support we can provide." On the right, Sen. John McCain, considered a more "mainstream" Republican, said he would vote for it, but it would be "hard to swallow." Farther to his right is the Tea Party; many Tea Party activists are disappointed that it does not include a constitutional amendment to limit spending as was proposed by the "Cut, Cap and Balance" plan. Even if the Tea Party isn't supporting the deal, many are criticizing Obama for letting them "take America hostage" and drag the so-called compromise farther to the right than any Democrat would like. The Tea Party may have even harmed its own parent party—the GOP, especially with its continued refusal to support Boehner's plans (both this one, and the one he presented to the House Thursday night). Argues Obama campaign strategist David Axelrod, "In the long term, I think the Republicans have done terrible damage to their brand. Because now they're thoroughly defined by their most strident voices." So though the bill might be a loss for the Tea Party in terms of its policy, the standoff itself could be a win in the political clout the Tea Party has proven to carry within the GOP. [See a collection of political cartoons on the Tea Party.]
We want to know what you think. Who came out on top with the debt deal? Obama, in that he would not face a debt ceiling crisis again before the 2012 election? The GOP, in making Obama cave in on revenue increases? Or the Tea Party, in bringing the terms even farther to the right than even many Republicans comfortable with and in continuing to stall the process? Take the poll and post your thoughts below.
Previously: Has the Tea Party taken over the GOP?