John Boehner: Raising Debt Limit Will Have 'Price Tag'

Nothing like more threats from House Speaker John Boehner on whether they'd agree to pay for the debt incurred under his and the Republicans watch during these "fiscal cliff" negotiations. Boehner: Debt Limit Will Have ‘Price Tag’: House
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Nothing like more threats from House Speaker John Boehner on whether they'd agree to pay for the debt incurred under his and the Republicans watch during these "fiscal cliff" negotiations. Boehner: Debt Limit Will Have ‘Price Tag’:

House Speaker John Boehner (R-OH) affirmed that if a deal to avert the fiscal cliff includes raising the debt limit, then it must come with a "price tag," at a news conference Thursday.

"If we're gonna talk about the debt limit in this, then there's gonna be some price tag associated with it," Boehner said.

Senate Majority Leader Harry Reid (D-NV) has said that raising the debt limit must be part of the deal.

As Jed Lewison explained, there are some alternatives to Boehner's hostage taking:

The good news here is that there will only be another debt limit crisis if the White House and Congress want there to be one—and we've seen no indication that the White House wants one.

In 2011, most people assumed that congressional failure to raise the debt limit would automatically force default and financial apocalypse would soon follow. But as Yale Law Professor Jack Balkin argued, that was a bad assumption. If Congress were to fail to lift the debt limit, the administration would still have several options to avert catastrophe. One such option would be to essentially ignore the debt limit because it conflicts with congressional statues appropriating funds beyond that limit. Another option would be to mint a trillion dollar coin and deposit it in the Federal Reserve.

And as Ezra Klein wrote today, the Republicans are demanding that the Democrats make cuts to the Medicare program, but because their only policy on this has been premium support, which is a non-starter, they don't have any proposals of their own, so they're trying to get President Obama and the Democrats to give specifics: The GOP’s Medicare confusion:

The austerity crisis talks have hit a peculiar impasse. The problem isn’t, as most analysts expected, taxes, where Republicans seem increasingly resigned to new revenue. It’s Medicare. And the particular Medicare problem isn’t that Democrats are refusing the GOP’s proposed Medicare cuts. It’s that Republicans are refusing to name their Medicare cuts. [...]

If you dig deep into the Republican think tank world, you can find a few proposals that focus on the near-term. The most serious plan I found came tucking inside the American Enterprise Institute’s contribution to the Peterson Institute’s 2011 Fiscal Summit: In addition to moving toward premium support, they propose simplifying and enlarging the deductible, instituting a 20 percent co-insurance rate, introducing a “premium surcharge” for seniors who use supplemental insurance, and giving physicians more discretion in setting their prices. But there’s little unanimity around these proposals, and no leading Republican politician has endorsed them, perhaps because doing so would be tantamount to suicide.

That’s left Republicans in a peculiar negotiating position: They know they want “Medicare reform” — indeed, they frequently identify Medicare reform as the key to their support for a deal — but aside from premium support, they don’t quite know what they mean by it, and they’re afraid to find out.

The solution they’ve come up with, such as it is, is to insist that the Obama administration needs to be the one to propose Medicare cuts. “We accepted this meeting with the expectation that the White House team will bring a specific plan for real spending cuts — because spending cuts that Washington Democrats will accept is what is missing from the balanced approach that the president says he wants,” Boehner spokesman Michael Steel said in regard to the most recent round of talks.

Democrats find this flatly ridiculous: Given that the Obama administration would happily raise taxes without cutting Medicare but that Republicans will only raise taxes if we cut Medicare, it falls on the Republicans to name their price. But behind their negotiating posture is a troubling policy reality: They don’t know what that price is.

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