The RP’s Budget Crisis Update- July 29

House Majority Whip Kevin McCarthy (R-Calif.) worked with Speaker Boehner to obtain votes for his ultimately delayed budget vote until late last night.

There was one major development in the Budget Crisis yesterday: Nothing happened. After a vote originally scheduled for 6 p.m. was delayed several times, Republican leadership announced at around 10:30 that no vote would be taken on Speaker Boehner’s debt-reduction plan until Friday at the earliest. Republican leadership had been having difficulty, highly publicized, rounding up a sufficient number of “yes” votes from the Republican Caucus to pass the bill with no Democratic support. [The Hill]

On the up side, New York-based analyst Brian Gardner, who works for a boutique investment bank in that city, theorizes that threats to lower the United States’s credit rating under certain circumstances even if the debt ceiling is raised may be a bluff. According to his analysis, some level of “enforceable cuts” with an appropriate debt ceiling increase would avert the downgrade. [Huffington Post]

Democratic congressional leaders are floating the idea of a compromise bill that they hope will be amenable to House Republicans. According to the plan, the debt ceiling increase would still be in two steps, but the second raise would not be contingent upon the findings and recommendations of a panel dedicated to cutting the deficit. [Politico]

House Minority Whip Steny Hoyer of Maryland became the highest-ranking Democrat to call on President Obama to raise the debt ceiling unilaterally if a deal is not reached in time for the August 2 default deadline. The President’s authority to do this is said to derive from the 14th Amendment, which says that the validity of the US’s public debt shall never be called into question, though Congressional powers derived from Article 1 muddy the issue some. [Huffington Post]

Adding urgency to budget negotiations, at least over the long run, a study from Medicare economists has come to the conclusion that by 2020, healthcare costs will hit $4.6 trillion, or one-fifth of the American economy. At that point, per capita health spending is estimated to be at $13,710. [Huffington Post]


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