Mike Shedlock

There's nothing new from the White House:

1. A default would be catastrophic
2. Obama will not negotiate the budget until a "clean" debt ceiling bill is passed
3. Boehner should put a "clean" bill up for vote in the House

Split Screen Sniping

Bloomberg reports

The White House, in a statement, urged Boehner to allow a vote on raising the debt limit and repeated that only Congress can authorize more borrowing. Obama, who will make a statement and take questions in the White House briefing room, is willing to negotiate after Republicans end the shutdown and remove the risk of default, the statement said.

The split-screen sniping -- with Boehner speaking to reporters and Reid speaking on the Senate floor -- came as lawmakers are taking the first tentative steps toward resolving the standoff.

Senate Democrats are planning a test vote before the end of this week on a measure that would grant Obama authority to raise the $16.7 trillion debt ceiling, probably for a year unless two-thirds of both chambers of Congress disapprove.

“The American people are watching an unwillingness by one side to negotiate and compromise,” Representative Tom McClintock, a California Republican, told reporters in Washington today. “They are watching utterly vindictive actions by the administration to intensify the pain of the shutdown and I think they watching the collapse of the admininstration’s signature program, Obamacare.”

House Democrats rejected the idea, saying it would recreate the 2011 bipartisan supercommittee that deadlocked.

“We don’t need a supercommittee,” said Representative Xavier Becerra, a California Democrat. “The votes exist right now” to reopen the government.

If all Senate Democrats along with six Republicans vote for giving Obama authority, they could send a debt-limit increase without policy conditions to the Republican-controlled House early next week. That would put pressure on Boehner, who opposes a clean debt-limit bill.

A spokesman for Mark Kirk, an Illinois Republican, said in an e-mail that Kirk would vote for raising the debt ceiling without conditions.

At least four Senate Republicans -- Murkowski, John McCain of Arizona, Bob Corker of Tennessee and Susan Collins of Maine -- kept open the option of voting for a debt-limit increase without conditions or helping one pass.

Senate Six

For the Senate Democrats’ plan to work, at least some Republicans would have to allow it to happen. Giving Obama the authority would require the support of at least six Republicans on procedural votes.

In the House, Boehner would have to allow a vote on the plan and at least 16 Republicans would have to support it for it to succeed. He has said the House won’t pass a clean debt-limit bill.

Calendar is Running

The calendar is running but time will not expire.

If six Republican senators sign on to the concept (as I expect), Boehnner will be under extreme pressure to put the proposal up for a vote.
Boehner's Lie

Boehner claims he does not have the votes to pass a clean bill, but that's a lie. The Huffington Post tallies 27 Republicans who would sign a clean bill.

If Boehner actually wanted to pass that bill he could easily muster 40 Republican votes.

How Many Votes Needed?

Here's the Makeup of the House:

435 Members
232 Republicans
200 Democrats
003 Vacancies

218 votes constitutes a majority. All Democrats would sign a clean bill, so the House would only need to pickup 18 out of 232 Republicans. That total is in the bag.

Supporters of a clean bill have enough votes now to force an up-or-down vote, but many Republicans do not want to overrule Boehner.

Currently, the Hill reports GOP centrists won't force 'clean' CR vote. However it could come down to that, so Boehner needs to be very careful here.

Hardball

The face-saving mechanism for Boehner is if the Senate passes a clean measure, with at least six Republicans, that Boehner will put to the floor of the House for vote. Otherwise Boehner runs the risk that 218 House members will force a vote.

In the end, something will give. Boehner will agree to put a clean bill to vote, or it will be crammed down his throat by moderate Republicans who will not want to take the blame for a default. It will be the end of Boehner as House Speaker if he is forced into a vote.

The calendar is running, but time won't expire. There will be no default, one way or another.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com


Mike Shedlock

Mike Shedlock is a registered investment advisor representative for Sitka Pacific Capital Management.