House Republicans Plan To Link Debt-Limit And Shutdown Into One Fiscal Fight

Tyler Durden's picture




 

Nancy Pelosi tried hard this evening (in the post WH meeting presser) to position the Democrats in order to disavow the inevitable but now Bloomberg is reporting that:

  • *HOUSE REPUBLICAN PLAN WOULD LINK SHUTDOWN, DEBT-LIMIT FIGHTS

House Republican leaders plan to bring up a measure to raise the U.S. debt-limit as soon as next week as part of a new attempt to force President Barack Obama to negotiate on the budget by merging the disputes over ending the government shutdown and raising the debt ceiling into one fiscal fight. This is not what most sell-side strategists expected as a base-case; in fact it is close to a worst-case for many - especially given Obama's apparent unwillingness to negotiate.

 

Via Bloomberg,

House Republican leaders plan to bring up a measure to raise the U.S. debt-limit as soon as next week as part of a new attempt to force President Barack Obama to negotiate on the budget, according to three people with knowledge of the strategy.

 

The approach would merge the disputes over ending the government shutdown and raising the debt ceiling into one fiscal fight.

 

“I’d like to get one agreement and be done,” House Majority Whip Kevin McCarthy told reporters today without offering details.

 

Republican leaders are attempting to pair their party’s priorities with a debt-limit increase, a plan they shelved last month to focus on a stopgap measure to fund the government in the new fiscal year. The goal is to have a bill ready in coming days, even without resolving the partial government shutdown, according to a Republican lawmaker and two leadership aides who asked not to be identified to discuss the strategy.

 

So... uh...

The President made clear to the Leaders that he is not going to negotiate over the need for Congress to act to reopen the government."

 

But the Republicans plan to link the debt ceiling to the re-opening of government...

It seems - as President Obama warned - this time is different (no matter how much the Fed tries to do, we suspect the politicians 'need' a crash to get something done)...

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Wed, 10/02/2013 - 20:27 | 4016512 LetThemEatRand
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Bullshit.  Theater.  R's are paid off by the same bankers D's are paid off by.  I will eat my own asshole if there is a real failure to raise the debt ceiling (by which I mean more than a gesture -- a real line in the sand where we default).  It is not going to happen.  

Wed, 10/02/2013 - 20:31 | 4016535 zorba THE GREEK
zorba THE GREEK's picture

No need to dine where the sun don't shine, it's all Kabuki and playing to the conservative constituents. 

When push comes to shove, public outrage over not getting their handouts will make them cave.

Wed, 10/02/2013 - 20:37 | 4016559 The Alarmist
The Alarmist's picture

Headline: "House Republicans figure out how to masturbate."

Wed, 10/02/2013 - 20:38 | 4016563 Xibalba
Xibalba's picture

And Dems learn to like the taste

Wed, 10/02/2013 - 20:44 | 4016582 SWRichmond
SWRichmond's picture

this is all theater for the Treasury market.  if we just blew through the debt ceiling again the markets would lose confidence.  so they have to act like it matters like they care.  

I think the Syrian dust up which was actually going to lead to war with Iran which would provide cover for raising the debt ceiling because of course no one could ever contest raising the debt limit while we're at war.  what we're seeing is plan B.

Wed, 10/02/2013 - 20:48 | 4016617 fonzannoon
fonzannoon's picture

Maybe they will default. Maybe they know that the knee jerk reaction of a default would be to drive the 10yr sub 2%...maybe even sub 1.5%...so they default for a day or two. Stawks would snap right back and we would get borrowing costs down huge.

Wed, 10/02/2013 - 21:31 | 4016767 DJ Happy Ending
DJ Happy Ending's picture

Maybe Michelle Obama will get involved like Nancy Reagan and Hillary used to do with their husbands and take care of business.

Wed, 10/02/2013 - 21:49 | 4016844 strannick
strannick's picture

Anyone who sees this debt ceiling farce and doesnt buy gold, probably has a ''hope and change'' bumper sticker

Wed, 10/02/2013 - 22:12 | 4016948 booboo
booboo's picture

I'll wait and buy yours at sub 700.

Wed, 10/02/2013 - 23:25 | 4017210 DoChenRollingBearing
DoChenRollingBearing's picture

Won't be buying mine..., nor his either I bet.

Thu, 10/03/2013 - 01:11 | 4017410 Boris Alatovkrap
Boris Alatovkrap's picture

Maybe is buy Boris' copper at 700:)

Thu, 10/03/2013 - 09:12 | 4017946 superflex
superflex's picture

If it goes to 900 I'll be buying and not selling.  Just like 90% of the people here.

 

Wed, 10/02/2013 - 20:58 | 4016647 Mike in GA
Mike in GA's picture

I don't think these bastards plan that far ahead.

Wed, 10/02/2013 - 22:25 | 4017005 Pegasus Muse
Pegasus Muse's picture

Manning pretty much nails it.

====

VIDEO: OMG Pastor Manning gives it to Obama like it is; I can't believe what he says at the end; I spit my coffee out.

http://youtu.be/aoZjXDP7LHs

Thu, 10/03/2013 - 01:16 | 4017420 Boris Alatovkrap
Boris Alatovkrap's picture

Boris confused. 99% black AmeriKa is vote Obama, not one, but twice... Now, is surprise Barry is screw-up communist love child?

Wed, 10/02/2013 - 20:58 | 4016649 Lone Deranger
Lone Deranger's picture

The people who tell oBummer what to do (who also really run the country), are probably still yelling at the people (in the NSA, CIA, etc) who let the Syrian invasion fall apart.  I can just hear them now... 

"You idiots!  You knew we needed that distraction, and now look where we are!!" 

"Get your butts over there and start a Middle East war, or even North Korea for cripes-sake before this damned debt ceiling thing gets real!!!" 

Wed, 10/02/2013 - 23:29 | 4017222 Fish Gone Bad
Fish Gone Bad's picture

Blowing up North Korea would be easy.  There is so little electricity, just bomb it at night and shoot out the lights.  Then drop fire ants on the entire place.  Their lives are pretty miserable now, just wait until the fire ants start stinging anyone who tries to eat them.

Wed, 10/02/2013 - 20:45 | 4016590 James_Cole
James_Cole's picture

Heard a couple discussing this over coffee this morning. 

"You hear the US government is shutdown?" "Really? Why?" "Because they're fucking idiots?"

Bingo! Everything that needs to be said about this debacle in one nice concise phrase!

Please for the love of Gawd, the world has not stopped spinning - there are other news stories out there beyond breathless non-updates on the continuing shutdown.

Wed, 10/02/2013 - 20:51 | 4016629 XenoFrog
XenoFrog's picture

The worst case scenario for the statists in this situation is that the shut down lasts long enough for people to realize just how little the Federal government is needed.

Wed, 10/02/2013 - 21:20 | 4016739 James_Cole
James_Cole's picture

That's all well and good, but I was talking about the media coverage. Periodically these idiotic debates come up & are covered 24/7. The stories that come out seem like coverage from a pre-school. 

Billy won't even talk to me!! Boooo crryyyyy wahhhhhh

Wed, 10/02/2013 - 22:05 | 4016921 Clever Name
Clever Name's picture

Totally disagree. Your average Joe phony conservative will change his mind when his business that relied on .gov workers salaries to keep said business running fails.

"Hey, maybe I didnt build that"

Heard Tim Kaine (VA) today saying that he was taking complaints from one of his most conservative districts that NASA had shut down and the local economy was getting crushed because of it. Its all well and good to say "We need smaller govt" until you really have to come to grips with the fact that your small biz is totally reliant on it. Not saying I agree with the mindset, just pointing out the harsh reality. You can guarantee that if this drags on, it will push many more onto the dole.

Forward!

Wed, 10/02/2013 - 22:14 | 4016949 NoDebt
NoDebt's picture

"until you really have to come to grips with the fact that your small biz is totally reliant on it"

Nobody is listening to "small biz."  They're completely irrelevant.  Big Biz, different story.  They were in the White House today.


Wed, 10/02/2013 - 22:19 | 4016978 Clever Name
Clever Name's picture

As usual, the little guy is gonna get the shaft.

Wed, 10/02/2013 - 22:16 | 4016964 booboo
booboo's picture

"We need smaller govt" until you really have to come to grips with the fact that your small biz is totally reliant on it.

Bullshit

and my guess is you are home walking the wifes dog because your government job has been deemed non essential.

Wed, 10/02/2013 - 22:23 | 4016989 Clever Name
Clever Name's picture

Not sure how you came up with that one bub, but you are incorrect.

I'm just pointing out that this will kill many small businesses, put more people out of work and onto the dole, and prove that many so called conservatives are actually for big govt.

Oh yeah, bite me.

Wed, 10/02/2013 - 22:36 | 4017060 Doyle Hargraves
Doyle Hargraves's picture

If this wasn't totally scripted, then in a default there would be no 'dole' for people to go on and no .gov to speak of. Corporations and .gov would collapse under their own weight. Small businesses would be flexible enough to fill the breach.

Wed, 10/02/2013 - 22:42 | 4017082 Clever Name
Clever Name's picture

Sorry, was speaking only of the shutdown. A default (that will never happen, and it doesnt matter cause its all bs anyway) is a different matter. Tying them together seems like a decent enough strategic move. The outcome will be the same regardless. Little guy=screwed.

Wed, 10/02/2013 - 22:57 | 4017105 Doyle Hargraves
Doyle Hargraves's picture

Default is already happening via QE. Less questions to answer from the debt holders versus a 'hard' default. It is a strategic move tying the two together, at least from a PR standpoint. In order to get the sheep to quit worrying and make sure both parties come out more 'needed' by the sheep then they were going into this and not realize what fresh hell awaits them thanks to the new bipartisan 'deal' they made with money that isn't theirs to begin with. Your right though we will get screwed.

Wed, 10/02/2013 - 22:38 | 4017064 mofreedom
mofreedom's picture

you smart joey.

Wed, 10/02/2013 - 23:26 | 4017212 Blano
Blano's picture

This conservative understands that's exactly what should happen and I'm all for it.

Wed, 10/02/2013 - 22:59 | 4017130 Serenity Now
Serenity Now's picture

You have your chicken and egg mixed up.  The government is reliant on the business man, not the other way around.  Government starts with ZERO.  The productive man produces, then pays taxes. 

No doubt that businesses get hurt when people lose their jobs.  Furloughed employees have not lost their jobs.  They most likely will get back pay, which means that they are on a free vacation on our dime.  

Obamacare, however, IS causing people to lose their jobs.  Bad for businesses and government.

Your theory looks good on paper, but it doesn't play out if you are intellectually honest about it (which I believe you are trying to be, by the way).  If government workers are so great for business, then let's make everyone a government worker.  Oh wait, there would be no businesses to pay taxes.  

I take your point that furloughed workers won't be out spending, and that will cause all businesses pain in the short term.  But I would argue that the vast majority of small business owners do NOT expect the government to provide them with customers.  

I would also argue that if we don't reverse the course we are on NOW, then we will face a complete government collapse later.  The math is unemotional about it.  How will that be better for anyone?

Wed, 10/02/2013 - 23:27 | 4017219 Blano
Blano's picture

He is right to an extent, but that govvie dependent chaff needs to be weeded out as well.  So be it.

Thu, 10/03/2013 - 09:05 | 4017919 pan-the-ist
pan-the-ist's picture

This might be how it used to be, but today we're still in a fantasy world where money gets printed, wheels get greesed, and business is funded by the government, either directly or indirectly through government contracts.  No big government means less business funded by the DOD and other socialism - that is your blind spot.

Thu, 10/03/2013 - 01:43 | 4017445 buyingsterling
buyingsterling's picture

I speak for 99% of small business owners: The government is not our friend. They drain our resources, force us to waste time with paperwork, and aside from the roads people drive on to visit our businesses, we get precisely DICK from the relationship. We DID build it, not because of government's help, but IN SPITE OF their petty tyranny.

Thu, 10/03/2013 - 09:06 | 4017926 pan-the-ist
pan-the-ist's picture

A government funded by corporations that create rules so you cannot compete with said corporations.  THEY don't want you here.

Wed, 10/02/2013 - 23:28 | 4017221 DoChenRollingBearing
DoChenRollingBearing's picture

+ 100 XenoFrog

Thu, 10/03/2013 - 02:22 | 4017488 EARLPEARL
EARLPEARL's picture

themselves or each other...or the dems..i am confusd please be more specific

Wed, 10/02/2013 - 20:31 | 4016537 SHEEPFUKKER
SHEEPFUKKER's picture

Surprised http://www.usdebtclock.org/ is still up and running, though it's probably off but a trill or two or a hundred. 

Wed, 10/02/2013 - 23:03 | 4017140 thelibcentury
thelibcentury's picture

200 hundred. or so...

Wed, 10/02/2013 - 20:33 | 4016538 ACP
ACP's picture

Yeah, if the Repussies had any ballz, they'd start negotiations with a reduced debt ceiling around $15 trillion and work lower from there.

But alas, they don't.

Wed, 10/02/2013 - 21:23 | 4016742 CrashisOptimistic
CrashisOptimistic's picture

 

That would indeed be interesting, but it really doesn't matter.

Numbers on a screen that describe an imaginary substance like money will not be permitted to "take the system down".  The system will not implode.  The economies will not blow up.  Nothing having to do with numbers on a screen will be allowed to deprive the powerful of their power.  They will just decree a change to the numbers.

And make no mistake about it, every single relevant economic or financial entity worldwide will agree with the decree.

This is not going to "end the world".  Only oil can do that.  The joules in a barrel of oil cannot be changed.  They can be redefined, but they can't be decreed.  In the end, which is not far off, the powerful will lose their power only as a result of that.

Wed, 10/02/2013 - 23:10 | 4017172 thelibcentury
thelibcentury's picture

It will be less than the barrel of oil that topples the domino chain. There are plenty of numbers on screens that cannot be controlled without vast, unreasonable conspiracies, plenty enough to set up unstoppable chain reactions.

Wed, 10/02/2013 - 20:33 | 4016544 fonzannoon
fonzannoon's picture

They may hard default and It is bullshit LTER, and I don't blame either party on this one. When they loaded up on those SPY puts they expected at least 1625 before they sold them and went long. 1690 ain't going to cut it. Now granted, a full blown default may actually get Facefart back below $50 and damage the recovery, but time will heal all.

Wed, 10/02/2013 - 20:33 | 4016550 One And Only
One And Only's picture

You can't eat your own asshole. Nice try.

Wed, 10/02/2013 - 21:08 | 4016689 Anusocracy
Anusocracy's picture

I thought Obama was every American's asshole.

Wed, 10/02/2013 - 21:33 | 4016776 NotApplicable
NotApplicable's picture

One sharp knife invalidates your thesis, sir or madam.

Wed, 10/02/2013 - 20:33 | 4016551 goldenbuddha454
goldenbuddha454's picture

I'd like to see that maneuver, one not even Ron Jeremy has attempted yet!

Wed, 10/02/2013 - 20:43 | 4016585 goldenbuddha454
goldenbuddha454's picture

If you have a few ribs taken out like Marilyn Manson, maybe then you could do that, but until then, I think the odds are against you.

Wed, 10/02/2013 - 21:19 | 4016729 WTFUD
WTFUD's picture

Don't know about that, however, there's a few fuckers ribs i'd love to kick out, mostly depicted on WB's threads.

Wed, 10/02/2013 - 20:48 | 4016611 johngaltfla
johngaltfla's picture

So the pussies are going to fight now? I'll see it when I believe it. They are all con artisists, liars, shysters, crooks, and steamping piles of elephant dung. Panama looks better by the day....

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