GOP begins making its debt-limit demands
The GOP is starting to get specific about what they’re going to demand in return for increasing the debt limit. House Majority Leader Eric Cantor says “major spending cuts or budget process reforms.” Karl Rove says “robust spending and deficit caps requiring rescissions and cuts if spending or deficits breach historic norms.” Note the focus on procedural change. Most in the GOP have concluded — rightly, I think — that the debt limit debate won’t offer the time or the space for a comprehensive deficit deal. So the question is how the budget process could be remade going forward such that the next comprehensive deficit deal — or everything that happens in the absence of a comprehensive deficit deal — is more to their liking.
Many on the Hill and in the White House expect that the debate will ultimately come down to two alternatives: the McCaskill-Corker spending cap, which would hold federal spending at 20.6 percent of GDP — more than three percentage points lower than it is now, and much lower than it’s projected to be later — and the deficit-reducing trigger that the president included in his budget.