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News Link • Government Debt & Financing

Did The Debt Ceiling Battle Just End?

Congressional leaders of both parties meet at Blair House at 10:00 a.m. with Vice President Joe Biden amidst signals the kind of deal long envisioned by Treasury Secretary Timothy Geithner and some other administration officials (enforceable deficit reduction targets and a punt on entitlement programs till after 2012) appears increasingly likely. ... According to WSJ, The White House and the GOP are inching closer to a debt ceiling deal that will push any real, hard decisions until after the 2012 election. It's not that there wouldn't be spending cuts. There will be some trimming of domestic spending, as well as deficit targets, as well as automatic cuts that would kick in if goals aren't reached. But anything fundamental -- Medicare, etc. -- would be pushed off until another time, until maybe when there's a GOP President and GOP Congress that can have carte blanche. For what it's worth, some on the right like Rush Limbaugh have been predicting a sellout like this for a while, specifically that the GOP would cave on huge cuts with the idea of revisiting that in 2012. It may also be a sign that the Treasury's spin -- that hitting the debt ceiling equals default -- is working, and that the army of bank lobbyists hitting up Congressmen are doing their job. Read more:

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