Tag: politics

What you need to know about the “Super Congress” that will need to find at least $1.5 trillion in budget reductions.

Senate Majority Leader Harry Reid of Nevada announced Tuesday his picks for the upcoming “Super Congress.” They are Democratic senators Patty Murray of Washington, Max Baucus of Montana and John Kerry of Massachusetts.

Senate Minority Leader Mitch McConnell announced the Senate GOP counterparts will be Sens. Jon Kyl of Arizona, Pat Toomey of Pennsylvania and Rob Portman of Ohio.

GOP House Speaker John Boehner’s choices: Reps. Jeb Hensarling of Texas, Dave Camp of Michigan and Fred Upton of Michigan.

House Minority Leader Nancy Pelosi has until Aug. 16 to name her three picks to the committee that will have six Democrats and six Republicans, equally divided between the House and Senate.

The committee will try to work out $1.5 trillion in deficit reduction, after an initial round of more than $900 billion in spending cuts in the debt ceiling agreement. It is required to complete its work by November 23, and Congress then has until December 23 to vote on the proposal, with no amendments permitted.

A simple majority on the panel — seven of 12 members — is needed to approve whatever package it comes up with, meaning that it will require at least one member of either party to push something through by voting with the other side. The committee’s proposal would then need a simple majority in each chamber of Congress to make it to President Obama’s desk.

If the committee fails to reach agreement or Congress fails to pass whatever package it recommends, a trigger mechanism will enact automatic across-the-board cuts in government spending, including for the military.

According to the CNN/ORC International Poll released Wednesday, 63% of respondents say the so-called “super committee” should recommend increased taxes on higher-income Americans and businesses, with 36% disagreeing.

Nearly two-thirds of respondents oppose major changes to Social Security and Medicare.

Nearly nine in 10 don’t want any increase in taxes on middle class and lower income Americans.

The political wrangling of the negotiations, with uncertainty over whether the government might default if no deal was reached, was one reason why Standard & Poor’s downgraded the U.S. credit rating from AAA to AA+ on Friday.

One of the main Republican arguments against tax increases on the wealthy is that they would inhibit job creation. The CNN/ORC poll results showed that only a third of respondents agree with that stance, while 62% say taxes on the wealthy should be high so the government can use the money for programs to help lower-income Americans.

U.S. stocks fell deep into the red on Monday as investors coped with the news that the United States had lost its “AAA” credit rating.

All three major U.S. stock indexes were down pushing the Dow below 11,000 for the first time since November.

The stock market has now lost 14% during the past two weeks.

“Investors are having one reaction to the downgrade: sell first and ask questions later,” said Paul Zemsky, head of asset allocation with ING Investment Management.

The Dow Jones industrial average (INDU) sank 634 points; the S&P 500 (SPX) lost 79 points; and the Nasdaq Composite (COMP) had dropped 174 points.

During the Debt Ceiling negotiations, economists urged lawmakers to come to a compromise to avoid just such a reaction from the stock markets. However, several conservative and Tea Party pundits and supporters made clear they thought a downgrade would be a good thing.

Fox News’ vice president of business news Neil Cavuto recently said during an interview with John Stossel “I would welcome a downgrade. I really would.”

ThinkProgress spoke with Rep. Mick Mulvaney (R-SC) to get his further thoughts about a possible default. Mulvaney said that a default would actually be preferable because raising the debt ceiling without addressing the “underlying fundamentals” would make “things worse.” Mulvaney argued that just increasing the debt ceiling would cause more harm than a default. “If we do a clean debt ceiling, that could be the worst thing we can do,” he said:

ThinkProgress: In terms of the debt ceiling, there’s a lot of talk about possibly defaulting in a couple weeks, but obviously Republicans are worried about long-term fiscal health in terms of the effects of raising revenue. Which do you think would end up being worse for the country, if we were to go through a short-term default or if we were to have long-term revenue increases?

MULVANEY: I think the worst thing for the country is to not fix what got us here in the first place. That’s why you see us fighting so hard on this issue, to not have a clean debt ceiling. I think ratings agencies told me the same thing. If we simply raise the debt ceiling but don’t address the underlying fundamentals, then we’re making things worse.

ThinkProgress: So that might end up being even worse than a default?

MULVANEY: I think so. If we do a clean debt ceiling, that could be the worst thing we can do.

Mulvaney is not the only member of the Republican caucus downplaying the consequences of a default. Rep. Devin Nunes (R-CA) called for the nation to default on our debt obligations because “it could benefit us to go through a period of crisis.”

Rep. Ron Paul (R-TX) agreed that default could be a “positive thing” because it will show we’re “serious.” Even House Budget Chairman Paul Ryan (R-WI), considered by many in Washington to be the “serious” conservative economic voice, advocated a short-term default.

So as you watch your retirement accounts and life savings take another hit, remember the message from these folks: this is for our own good.

The United States lost its top-notch AAA credit rating from Standard & Poor’s on Friday, in a dramatic reversal of fortune for the world’s largest economy.

S&P cut the long-term U.S. credit rating by one notch to AA-plus.

U.S. Treasuries, once undisputedly seen as the safest investment in the world, are now rated lower than bonds issued by countries such as the UK, Germany, France or Canada.

The outlook on the new U.S. credit rating is negative, S&P said in a statement, a sign that another downgrade is possible in the next 12 to 18 months.

Thank you Tea Party. By encouraging your representatives to drag out the debt negotiations, you all must be very, very happy now.

Americans overwhelmingly are concerned about the U.S. debt crisis and a majority backs the type of compromise pushed by President Barack Obama, a Reuters/Ipsos poll found on Tuesday.  I’m not making this up kids – this is Reuters, which is non-partisan.

Showing an intensity of interest among Americans who often ignore the intricacies of policy in Washington, 83 percent of those polled said they were either very or somewhat concerned about the potential for a U.S. debt default on August 2.

The poll found that 56 percent of Americans want to see a combination of government spending cuts and tax increases included in a deal to bring down the U.S. budget deficit and permit a vote to raise the country’s $14.3 trillion debt ceiling.

This is the approach favored by Obama and his fellow Democrats to begin to put America’s fiscal house in order.

Republicans oppose tax increases and instead want to cut back deeply on spending, saying the federal budget has gotten out of control.

“It does seem to be that the popular narrative is falling on the side of the president on this one,” said Ipsos pollster Julia Clark.

The Reuters/Ipsos poll found that 31 percent of respondents held Republican lawmakers responsible for the debt impasse, 21 percent blamed Obama and 9 percent blamed Democratic lawmakers.

The United States will lose its top-notch AAA credit rating from at least one major ratings agency, according to another Reuters poll on Tuesday.

According to a CNN/Opinion Research Corporation survey released Tuesday, the Democrats have a four-point margin over the Republicans in the battle for control of Congress.

The poll indicates that 50 percent registered voters say if the election for Congress was held today, they would vote for the Democrat in their district, with 46 percent saying they would cast a ballot for the Republican in their district. The Democrats’ four-point margin is within the poll’s sampling error.