MEMO TO BOEHNER (Thoughts on the Fiscal Cliff. . .and the Stupid Party)

As the deadline approaches to find a solution to the "fiscal cliff", some thoughts that I believe need to be kept in mind:

a)  The fiscal cliff is both a "tax" problem and a "spending cut" issue.  The tax problem can be explained as such:  without a fix, taxes will be going up on a whole swath of people (pretty much anybody who has a job, plus everybody who doesn't have a job because of their wealth and/or investments).  The spending cut issue is all about sequestration--the mandatory mechanism to cut spending that was agreed upon as part of the debt limit discussions in the summer of 2011.  These two events are "tied" to each other not by topic but rather by time:  absent a remedy, the "problems" would both take effect on the same business day.

b)  The Republicans have argued that higher taxes on anybody will hurt the economy.  While "middle class" taxpayers certainly don't want their own taxes to go up, I don't think that the big-picture argument that higher taxes on the wealthy will have a negative impact on the rest of the economy is winning the day.  In fact, if there is one takeaway about the election, I opine that such takeaway is that a majority of the country seems to think that higher taxes on the wealthy will help in some way, shape, or form.

c)   Obama may or may not care to watch the country go over the "cliff"--but that is immaterial.  What IS material is that he wants to stick the GOP with the most nefarious intentions possible.  In that desire he is joined by the media, which undoubtedly would like nothing more than to watch the House flip back to Democrat control in the '14 mid-term elections.  The media will play up any and all noise of GOP intransigence or disarray in order to poison the battelefield for the next midterms.  This union, coupled with the confluence of legislative timing that brings us to the cliff, puts the GOP distinctly at a disadvantage in any negotiations.

d)  While the "cliff"  may be the biggest thing going on right now, it is child's play compared to conversations that Obamacare will bring to the dinner table in the next two years--provided that dinner table isn't already loathesome of the GOP.

and e)  those mid-term elections in '14 are a big deal.  Huge!  Can you imagine what will happen if the Dems have total control of DC for Obama's last two years?

Now to my multi-pronged thesis:

1.  First and foremeost, Republicans need to understand that the party already lost on the sequestration issue.  They believe they acted "responsibly" with the debt ceiling discussions last summer--and sure, I guess that allows some of us to sleep soundly at night.  But conservatives were outmaneuvered in those discussions.  Agreeing that national defense should be 50% of any spending cuts was just plain dumb from a strategic sense.  But that's a conversation for last year's discussions; for this year's discussions all we need to know is that the GOP is already a partner in the scheduled "non-discretionary" cuts to Defense and other agencies (but so is the Dem party).  There's no reason for rank-and-file Dems to reopen this discussion as anything other than a bargaining tool--in fact Obama seems only to bring the topic up as a play for more ridiculous concessions from the GOP.  "We" need to come to grips with the failure of last year; therefore those of us on the right should not put too much hope in sequestration being repealed, redirected, or "re-" anything.  It is the law of the land--get used to it and LEARN from it!

2.  Only with a firm grasp of the sequestration reality can we now attack the "fiscal cliff" in it's true light.  It is an unsolveable monster as a tax-and-spending beast (well, not unsolveable--but impossible to solve without making a deal that is really, really, really bad from the GOP's standpoint); it is a minor nuisance as a tax problem.  As it stands right now, the GOP is the only thing that ties another year of the current tax rates for 90-plus percent of the population to this around-the-corner deadline.  If the GOP can get out of their own way right now they can live to fight a battle on all these economic issues another day.  Case in point:  the Senate has already passed S 3412.  It's not a dream bill but it IS the easiest mechanism by which GOP keeps tax rates low on the portion of the population that "everybody" agrees should be spared from tax hikes.  SO pass it--have Boehner plus a host of others be a "no" vote because they don't think the bill solves any problem (insert boilerplate trickle-down discussion here) and have that position be the "face" of the House GOP--but ensure the bill passes so that the House GOP doesn't look like idiots that want everybody's taxes coupled together when that is not the position of this country at this time.

3.  This plan avoids any further negotiations--which will not work out well for the GOP regardless.  S3412 is already past the Senate; if the House passes it without amendment it goes to Obama for signature.  And he will sign it because he would have no other choice--he certainly couldn't be the ONE PERSON who keeps the extended low tax rates from 90-plus percent of the country.

This plan also keeps the debt ceiling right where it should be:  a separate topic that will draw its own interest later this year.

And most importantly:  this plan will let other issues "bubble" into the public conscious as they will (keeping in mind the media holds much sway on such things) without the accompanying narrative that "everything would be so much better if only that darn House GOP would have protected your tax rates."  I, for one, am almost longing for the public that re-elected the President to "feel" Obamacare in all it's splendor (not so much in the doctor's office but rather at their "office" office).  "Pass it to find out what's in it", indeed!

Benghazi: unfounded (but does that make them inaccurate?) thoughts

So I don't do this blogging thing too much anymore.  But it is not just my blogging that is a victim of my schedule:  I once invested some time and effort into writing long-form fiction.

Those efforts brought me to the point of trying to write a book--once.  I had a couple of ideas for follow-on books, too. . .but since the first book never got past 60 pages, there was really no need to explore a follow-on.

HOWEVER, I will tell you that one of the ideas that found its way into my notebook was a wag-the-dog scenario in which a troubled President gained hefty international stature by "resolving" an international incident (of truly limited impact on the international stage but played-up as a "walking on water" moment) that turned out to be entirely a creation of the President and his people.

Now I'll tell you I never had "kidnapping of a U.S. Ambassador to a newly-independent Middle East state that owes its independence to the President" as the incident.  But I did have "kidnapping", "international figure with symbolic significance", and "geopolitical hot-spot."

So why am I talking about kidnapping?  Is there any evidence that what happened to Amb. Stevens was a kidnapping attempt gone bad?

No, there is no such evidence... that has been made public at this time.

But I am struggling--mightily--with what motivates any man to "go to sleep" (metaphorically for sure; literally is possible, too) while the life of one of his friends is at risk of a violent end.

We know that Obama knew there was an attack underway on the Benghazi consulate.  Further, we know that Obama (or someone in his Situation Room) knew that Stevens was in that consulate at the time of the attack.

And we know practically nothing else regarding Obama's knowledge as the event was unfolding.  Did Obama ever ask about Stevens' condition?  Heck, did he try to reach out directly to Stevens via blackberry/cellphone/whatever device is used in Libya?  Did he know about the (three!) alleged calls for help from the annex a mile down the road?  How was he getting his information?  Who was in the decision loop?    

Now I myself have accused the President of being especially uncurious.  He seems to think he knows everything that he needs to know.

But this is beyond uncurious.  This is downright uncaring--about the lives of Americans and about the symbol of America on the international stage.  And it is hard to believe that anyone as blatantly political as this President would act that way this close to the election. . .

UNLESS there was some element of these happenings that were not unexpected to him.

So I'm forced to look at what we know Obama knew and why those events wouldn't bring him out of a decision slumber (which is the current stance of the administration as provided by the President himself--that Obama did not make any tactical decisions but rather issued directives regarding his hopes for the outcome).

How could it be that an attack on US personnel on sovereign US territory didn't force him into the mix?

How could it be that said attack WHILE THE AMBASSADOR WAS PRESENT did not get him riled-up to the point of interfering?

There are, I suppose, some common answers to the above questions.  But I'll be honest with you:  I think of myself as "creative" when it comes to things such as this and I only have two answers.

One is that he just doesn't care about an attack on American property and lives.  And while I know some people who may think so little of this President and the men and women who surround him as to lend credence to such a charge, I do not ascribe downright antipathy of American lives to this administration.  As far as explanations go, I believe the likelihood that this is correct hovers between zero and zero-point-one percent.

Which brings me to answer #2:  that some part of this event was planned with the full knowledge of the administration.  Some event where Stevens' life must have been known to be "not at risk."

And what, praytell, could be the only end-result from a group of folks breaching consulate security while the Ambassador was present that did not spell "possible doom" for Stevens?

In my mind, the only possible explanation is that Stevens was supposed to be kidnapped and held for ransom.

My guess is that State knew about this, too.  That's one of the reasons Sec Clinton threw herself under the bus--she has as much to lose in a full-fledged inquiry as anybody.

Wild conjecture?  Of course it is. . .but since the administration isn't doing much to fill in the blanks, my "creative" mind has no recourse but to go crazy within the construct of what is known.

Hopefully in time we will know everything about Benghazi.  I just hope that the findings will be a final epitaph on the era of hope-n-change rather than the reason for the following words:  "The forty-fifth President of the United States, Joseph Biden."

a word about Barack Obama's debate last night. . .

For the better part of at least a week, the Obama campaign has been "talking up" Gov. Romney's debate skills.  Even the President himself said some kind words about Romney's competence on a debate stage.

Which makes last night's performance by the President all the more damning.

Either he never believed that Romney was a good debater--in which case he's peddling lies in order to lower the expectations of his own performance.  This from a man who once promised to cause the tides to recede and to heal the planet. . .talk about diminishing returns!  So what, exactly, IS he offering us for the next four years that we can believe?

OR he believed every word he said about Romney. . .and when push came to shove and the President had to do the heavy lifting, he failed.  Badly.

gotta keep it simple

Okay, it's time for me to provide some unsolicited advice to the Romney camp.

Please note, I do not offer this advice because I am disheartened by his performance to date.  In truth, I'm pretty happy with where things stand.  He survived the summer negative ad onslaught and is in position to take advantage of "facts on the ground."  Or at least I think that is the status of the race.  Who knows if I'm right?

But he needs to seal the deal, and I'd prefer for him to do that soon.

And I know that Presidential campaign messages are complicated things.  There are so many things at play that trying to keep it soundbite-simple while still offering something more substantial than "Hope and Change"is challenging.

But not a challenge that I will run away from.  (Don't worry, you can offer your thanks by voting for Mitt!)

Let's make it three prongs for the victory, shall we?  How about:

a)  The economy.  There are fewer workers today than there were 4 years ago.  Median household income is lower now than at any time since 1997--and the trend for the entirety of the Obama Presidency is in the wrong direction.  And of course we can't forget about the national debt--$16T and counting, with US debt-to-GDP ratio approaching a point from which economic contraction is a near-certainty.  And need we even mention the "taxmageddon" at the start of 2013?  Well yes, we do, because there's no reason to assume that everybody knows about it--higher taxes from the implementation of Obamacare taxes and the expiration of tax cuts (to include the "Bush" tax cuts among others) will lead to higher taxes on EVERYONE that has a job.  If Taxmageddon happens as it is currently scheduled--which is to say if the White House doesn't get something done before Jan 1st--the impact will drive our economy to conditions in 2013 that will "probably be considered a recession."

Is there enough in there to cover the economic front?

2)  Let's take a good look at the political environment today.  Do you feel it is more or less hostile than it was in 2008?  Only one candidate has had 4 years to deliver on his promises to overcome the poison of partisanship in our politics; oddly, that same candidate told his political opponents "I won" in a meeting designed to promote bipartisan cooperation during the first days of the new administration.  To date, that same candidate's party is the only party that aired ludicrous ads that blame their opponent for the deaths of former employees; that party also allowed a leader of a Congressional caucus to take the floor of a chamber of Congress and accuse their political opponent of felonious activity.  Is this the "new kind" of politics that we were promised?

And there's a foreign-policy aspect to this line of attack, too.  Weren't we supposed to be beloved by the world?  Didn't Obama say something like his worldliness prior to inauguration--combined with his oh-so-brief time on the Senate Foreign Relations Committee (seriously??!!!)--will lead to the world viewing the US in a new light?  SO here we are, almost four years later:  the Middle East is a mess--and was such even before an American Ambassador was assassinated on the eleventh anniversary of 9/11; Egypt may or may not be an ally but one thing that is for sure is that their new government--which came into power as the entirely foreseeable consequence of Obama's action to oust Mubarak--is trying to bully the US into new gestures of, umm. . . "understanding" to the Arab world; Obama gets caught offering "flexibility" to a senior member of a government that continually pokes America in the eye at the UN Security Council-- wasn't all this supposed to be a thing of the past by now???  Where's the adoration we were promised?

and finally 3)  Obamacare needs to be front and center.  Not just as part of the economic argument posited in paragraph #1 above, but as a stand-alone for the reckless and headstrong manner in which this administration did EVERYTHING they did when they had total control in DC for two years.  (It will help remind folks, such as the viewers of the Univision interview who may have been left to believe something contrary, that Obama really wasn't powerless for the entire time he has been President)  In 2008 Obamacare (or something like it) was only a warning on the lips of the "wacky right"; then barely 14 months after inauguration it was rammed down an unhappy public's throat. . .and we had the backlash of the 2010 midterms.  But here's the thing:  even with the success of 2010, Obamacare will still get fully implemented if Obama wins re-election.  I still feel like the public doesn't like O'care--in fact, I feel that as the pricetag has increased (as it had to thanks to the budgeting gimmicks built into the thing; the current 10-year estimate on new spending under PPACA is about double the original estimate that accompanied the vote in early '10) public dislike of the thing has grown even greater.  I don't hear everything Romney says, but it's been a while since I heard O'care mentioned--and it's been an even longer while since I have heard him speak passionately about it.  I want this to be  referendum election, and this is the topic that most people "connect" with--so it needs to be front and center moving forward.  Make it as clear as possible to those on the fence/in the middle/however you want to call the people that will swing this election:  Obama = Obamacare.  We can't be rid of Obamacare unless we oust the bill's namesake IN THIS ELECTION.

Is that simple enough?

Election 2012: September 13th edition

In case I never told you before, I am a numbers guy.

And the nice thing about being a numbers guy is that I seldom get excited until the numbers tell me to get excited.

And I have to tell you with regards to the 2012 Presidential election:  there's no need to get excited (in a negative sense) yet.

I know, I know:  this advice is contrary to what the "news" reports would have you believe.  And who am I to question the all-knowing media?  

Well, like I said, I'm a numbers guy.  And I don't see "despair" in the current numbers.  So let's go to the numbers, shall we?

*  Biggest thing to keep in mind:  Obama has a big electoral vote foundation from which to build his 2012 campaign.  He won 28 states plus DC in 2008.  And he doesn't have to defend all those states--just enough to get to 270 electoral votes (EVs).  And if I was a lazy person, I would say that he has SO MUCH margin for error that there's no way Romney can overcome the challenge.  Fortunately, I am not a lazy person. (well, not today. . .or at least not on this topic)

*  Next thing to keep in mind:  the Presidency is not a nationwide popularity contest.  The President is determined on a state-by-state basis.  Most states give all their EVs to the candidate that wins the state's popular vote; Maine and Nebraska are the exceptions and their votes likely will not be "split" unless Romney either wins Maine (unlikely) or is able to win over the majority of the state that is not in the Portland-Augusta corridor (more likely than the other scenario, but not all that likely in itself).  Nebraska is unlikely to yield an EV for Obama; the state is represented by 3 Republicans in the U.S. House of Representatives, and all 3 of those folks won their election in 2010 with at least 60% of the vote in their Congressional district.  For the sake of keeping this simple, let's assume that Maine and Nebraska's EVs go 100% to the candidate that wins the popular vote in the state.

*  Due to the 2010 census, electoral votes have shifted in accordance with population changes.  If the state-by-state Presidential results of 2008 are repeated in 2012, Obama would actually lose 6 electoral votes.  Now since he captured 364 EVs in 2008, obviously he would still win in 2012 in that scenario. . .but the important thing is that the population shift works mostly in Romney's favor.  Assuming Romney wins all the same states that McCain won, his "foundation" is 180 EVs.  So he needs to peel off 90 EVs from Obama's 2008 column to win in November.

*  So now to the crux of the matter:  where does Romney get 90 votes from Obama's 2008 column?  I'll tell you that the states that need to be targeted by Romney's camp are the following:  Iowa, Wisconsin, Indiana, Ohio, Florida, Virginia, and North Carolina.  Right now all those states are classic "toss-ups"; if he wins those states and holds the rest of McCain's map, he wins 282 EVs--and the Presidency.  Heck, he could actually lose any one of the three smaller states on that list (Iowa, Wisconsin, or Indiana) and still get the White House.

*  How likely is it that any of the above states flip to Romney?  Keeping in mind that the campaign season is actually far from complete (I know, it seems like it's gone on forever already!), Indiana and even North Carolina look like pick-ups for Romney.  If that guess holds through November, a Romney victory requires the GOP to win either Iowa or Wisconsin, and all of the following states:  Ohio, Florida, and Virginia.  

*  There's a reason the convention was in Tampa, don't you think?  Or that R&R hit that state hard to overcome the all-too-foreseeable Mediscare tactics from the left?  There's also a reason that Ryan is on the ticket--not just that he's a darn fine public servant and a smart guy on the economy, but also he "belongs" in Wisconsin. . .say, at a Packers game on a Thursday night when the hated Bears roll into town.  

*  Important fact:  all the states listed above except North Carolina have Republican governors (and Gov Perdue is so unpopular in NC that the Dem candidate to replace her is down comfortably to the Republican candidate for the Governor's mansion).  Kasich in Ohio and McDonnell in VA are really popular and they've done some good work for their constituents; I'd look for them to put that popularity on the line and campaign hard for Romney.  Both states have big Senate elections, too--where it just so happens the Dem candidate for the Senate is either remarkably liberal (Brown in Ohio) or closely linked to everything "Democrat" from the first two years of the Obama Presidency (Kaine in VA; he was the Chair of the DNC from '09 to April '11--you know, when Obamacare was served up to the American people like a hot poker just waiting to mess up your insides).  Walker's recent recall victory in WI won't hurt much in that state, either.

*  NOT EVEN MENTIONED in the above scenarios are other states currently discussed as "toss-ups":  Colorado, Nevada, and New Hampshire.  There's 19 EVs in those three states; while I don't think my beloved CO will come back to the GOP this time around, I definitely think Nevada (and its chronic 12-plus percent unemployment and 6 Electoral Votes) is in play.  I don't know enough about NH to make even a wild guess; I will only point out that every little bit helps.           

So is there reason to be giddy?  No, not really. . .but the purpose of this post isn't to make you "giddy."  It's to keep you from despair, and to ensure you know the "how" of a Romney victory.  When you break it down by states, and then take a hard look at the GOP situation in those states. . .things aren't nearly as bad as some want you to believe.

Take heart in that. . .and then pick up the phone and talk to folks where it matters most!

Thoughts on the GOP field...and others

This piece started as a commentary on the end of Gov Tim Pawlenty's campaign.
But as I have discussed issues and opinions over the days subsequent to
Pawlenty's decision, this "piece" has morphed into something bigger. . .and
hopefully better.

First, a hope: that deficit spending quickly goes the way of the do-do. We
need to start paying for the government we have--period.

Second, an assertion: America really is at a crossroads. We are at the
proverbial fork in the road, and here are the two options as I see them:
continued government expenditures at levels that this administration favors; or
a severe cut to those expenditures to no more than the level of government
revenue. (DISCLAIMER: this is also a bit of "hope"; truth of the matter is
that I think this country NEEDS to be at a crossroads so that we can finally
begin down the path of our future. . .so my assertion may well be biased by the
tint of lenses through which I observe the world)

And finally, a goal: what I hope to get from the election in '12 is clarity on
which path this country chooses to go. I hope and pray that '12 really does
turn into a rubber match on the "mandates" of the last two national elections.

In '08, ANYBODY WHO CARED TO RESEARCH HIM had a good inkling that an Obama
administration was going to be expensive. The problem is that not everybody
cared to do the research-we were too swept away with catchy phrases and an
oft-told biography. In truth, an honest assessment of the "mandate" from the
election in '08 is that the country was tired of George W. Bush. Obama the
candidate was able to get away with platitudes because he was everything that W
was not. That Obama has governed the way he has should not be a surprise-but
claiming that he received a "mandate" to govern in such a manner is a bit of a
stretch, IMHO. However, it doesn't really matter in the big picture of
things-let's just say, for the sake of argument, that he was given a "mandate"
in '08.

Far more clear to me is the mandate from the '10 election: government, stop
spending our money!

The result of those two elections? Split government. . .and split government
doesn't solve problems; it simply glosses over the issue and then kicks the can
down the road.
So what we have are two diametrically opposed "mandates"-which just so happen to
coincide with my fork in the road. On one hand, we have a record of government
largesse; in the other corner, we have today's GOP largely looking for a way to
get government expenditures under control.

We need to make sure that the government we have is the same as the government
we want. And what I hope for from the '12 election is a "mandate" on which
fork America chooses to take.

An Obama re-election means higher taxes on those who pay taxes (and even some
who currently don't pay taxes) because we must pay (or start paying) for the
vast programs that he favors. As much as I don't like a higher-tax program, if
that is the direction the electorate chooses. . .so be it. Goodbye part of my
paycheck-it would have been nice getting to know you.

If the GOP challenger wins, then an immediate consequence SHOULD be a cutting of
federal expenditures-which undoubtedly means cuts to entitlement programs.
Again, not something that I "want" to do-but it is a necessity if we are to get
the country's fiscal house in order without an overwhelming increase in taxes.

NOW PLEASE UNDERSTAND that I will vote for any of the GOP candidates I discuss
below. I like all of the GOP players more than our current President (if I were
listing Obama's weaknesses I may type my fingers off!). That being said, I do
have a problem with the GOP field right now: there is no declared candidate who
I think can make this election about the choice that I would like to have as the
main event.

I do not want a challenger of the "compassionate conservative" mold. As much as
I personally admire President Bush (43), I thought his domestic policies were
pretty awful and expensive. An election of someone in that mold, of which I
would include Romney, doesn't provide the clarity necessary to save America.
While he may talk a good game, I am afraid Romney is too much of the "the
government is here to help you" mindframe to enthusiastically tackle our
entitlement programs-and during the campaign he won't be able to credibly talk
about the need to fix our entitlement programs unless he does a strong
about-face on Romneycare.

I am also leery of a GOP challenger that will have problems with the above
message getting overshadowed by personal flubs. This election needs to be about
a way ahead-but the media will try their level best to make this election about
Obama's likeability, and the way to do that is to make the GOP nominee look
unacceptable on a personal level. We can't have anybody who makes the media's
job in this arena too easy, which is a mark against Ron Paul. And I'm pretty
darn close to saying this issue also affects Bachmann, Gingrich, and Governor
Perry, too-at their current pace, Bachmann and Perry will be firmly in this
category by the end of September.

Alas, now we get around to former candidate Pawlenty. He had the potential to
be the candidate for which I yearn. The guy was a successful governor being
himself; he has already articulated an economic position far more clearly than
any of the other candidates (including the sitting President); and the major
personal criticism of him was that he wasn't "dynamic"-which barely scores a
"what was that?" on the personal pain scale. Unfortunately, his campaign was. .
.off-key. I honestly think that authenticity matters to some degree-especially
for a candidacy based on Midwestern values like Pawlenty's--but he was not
authentic in the two most-watched GOP events so far (both debates), and it cost
him the start that he needed. So now I lament the loss of Pawlenty. . .which,
although a good decision because of developments, is a huge loss to the field
from where I sit.

So who's left? Well right now, there's Santorum, Cain, and Huntsman who have
declared candidacies. I honestly don't know enough about any of the three of
them, although I have a hard time believing that Huntsman will be able to
deliver on my hopes for a clarifying election, and I have fears that Cain's
quippiness would lead to some unscripted moments that are cringeworthy. But
these are initial impressions that I will happily modify as further observations
warrant. In short, none of these guys is on my "watch out" list in either a
good or a bad way-yet.

What is interesting to me is the possible candidates still wearing their hats
(you know, because they haven't thrown them in the ring yet). Specifically,
both Governor Chris Christy and Rep Paul Ryan could provide an election with the
clarity I crave. . .but I fear both of them, too, would fall victim of the
personal flub issue. While Ryan is a hard worker on the House Budget Committee,
I was not impressed with his public performances in the later stages of the debt
ceiling debacle. I think it is possible to "stump" him, and I know the debate
moderators will be trying like gangbusters to do just that. Governor Christy
has courage, enthusiasm. . .and is a caricature of a political bully brought to
life. While not unpolished, his greatest moments are his less-polished moments.
. .and given his bravado, there is the possibility that something he says runs
askew of the sensibilities of the day. Don't get me wrong: it is that bravado
that I love about him. But this is a co
untry that 4 years ago voted for someone based (in part) on a three-word phrase
and as few other words of consequence as possible; have we really gone so far as
to elect a candidate that will consistently put out volumes of words of
"consequence", especially if they are as pointed as his past statements?

debt limit kabuki--UPDATED

[UPDATED to add an thought I had originally but did not include in my first post]

Welcome back, eh?

I figure with the 2012 election about to hit stride, it was high time for me to return to my ever-so-slim space for political sanity. Of course, it doesn't hurt that "the deal of the century" is being debated right now in DC. In fact, it is this deal that brings me out of my hibernation.

Word leaking from the Hill today is that some compromise has been reached. This is a compromise that--supposedly--has agreement from all the major players. From what I understand, there is some big reveal scheduled for 4 PM EDT (about five hours from my writing of this).

Now on past "deals" I was really focused on the actual words and scoring of the bill. I have learned that listening to the party leaders talk about the virtue of their proposals is worthless--reading the thing (and the CRS or CBO report) is where the good information can be found.

I am not so careful to read the actual bill this time. Why is that? Gee, let me count the ways:

a) All these cuts are just funny money. $23B from this year's $3-plus TRILLION budget? $900B and change over 10 years (and about $40T in projected outlays)? Whatever. . .

b) Default is a crackpot argument. One person can lead us to default, and even though he has the bully pulpit I don't think even he and his media minions will be able to spin a default into a story that reflects well on them. Of all the possible outcomes of this huge debate, default on the country's obligations to creditors is probably a least-likely scenario;

c) Since default isn't a real fear, all these negotiations to solve the wrong problem have been a crudfest from the word go. Add to that the fact that the bills under consideration are bad bills that don't actually govern much of our future, and you have the current state of the drama in DC. Much ado about nothing.

d) The REAL problem with our debt limit is the credit rating. And in my opinion, none of the bills under consideration in this process--not even CCB--SHOULD stave us off from a downgraded credit rating--and that is a true calamity that our system certainly cannot deal with right now.

Now I know I need to explain this credit rating/real problem thing a little better, so here goes: S&P--one of the three main sovereign credit agencies--describes a nation's credit rating as a measure of its future ability and willingness to service their commercial financial obligations in full and on time. A sovereign rating is a forward-looking estimate of default probability. Further, default is generally defined as the failure to meet a principal or interest payment on the due date.

Now I said earlier that default was a least-likely scenario out of all this hullaballoo on the Hill right now. In other words, in my own estimate our country's default is not at risk--so why is our credit rating at risk? BY MY OWN WORDS, we're not going to default--AAA all the way, right?

Well, no. Not right.

For starters, while a AAA is a pretty good guarantee of zero default, so are lesser credit ratings. In fact, in the last five years, no sovereign with an "A" rating or higher has defaulted. So while AAA is practically a guarantee, there are other, lesser ratings that have a great track record against default.

But more importantly: a credit rating is an estimation of the sovereign's FUTURE ability to pay its bills. The rating takes political considerations into account, as well as economic structure, general debt burden, and several other factors (nine major factors in total, with several subcategories in each).

I want to focus on this "political" side of the equation. Listen, I don't think that we are right around the corner from a revolution--which is a ACT that would definitely lead to a downgrade (of course, at that time, we'd have other things on our collective minds). But is it pure fantasy to think that the political atmosphere is such that revolution is an impossibility? Think Wisconsin, where the will of the voters is trying to be overturned by unions that were called into action by members of the ruling establishment; think South Carolina, where the will of private industry is trying to be overturned by an unelected branch of the ruling establishment; think about all the work being done in this administration to instill cap and trade in effect to overcome the failed attempt to get it in legislation. . .is it really too hard to see a time when private citizens become enraged to the point of fighting back physically against the ruling establishment? It may take only one more incident. . .or it may take several hundred more. . .all I know is that we're TWO such incidents closer than we were just at this time last year. And given the ridiculous rhetoric from the Hill during this debt debate, I'd say the leaders of the ruling establishment are doubling-down on anger. In fact, I'd say their entire political calculus for the last 2 years has been to rule from fear and to inflame their partisans.

Such actions in the face of an awake, determined opposition do not have a history of ending in a statesman's favored way. And if you think this isn't obvious to the ratings agencies, then you are taking a leap of faith.

But again, that's only one aspect of the rating. We have an increasing debt (even if the rosy predictions of economic recovery manage to come true); due to high-and-not-improving-yet unemployment combined with anemic GDP numbers so far in FY11 we can look to another revenue hit (with an accompanying unplanned increase in debt) THIS year. And, worst of all, there is NO appetite to deal with our ever-increasing entitlement problem on Capitol Hill, and there won't be such an appetite until AT LEAST 2013--if ever.

SO why wouldn't we be downgraded on our sovereign credit rating? I honestly can't tell you why, but I do know that even Obama understands that such a downgrade cannot be good. That's why all the credit ratings agencies were in his office last week, don't you know.

Now I wrote earlier that none of the bills SHOULD save us from a ratings downgrade. So what should we have done? Here's some background of my plan: that last spending bill submitted by the administration that wasn't wholly rejected on Capitol Hill was centered on Obama's FY11 Budget Request (submitted to a Congress controlled 100% by his own party). That document established the following spending requests: for FY11, federal outlays of $3.84T with a proposed deficit of $1.27T; for FY12, federal outlays of $3.76T with a proposed deficit of $828B.

My plan is to raise the debt limit an amount equal to half of the proposed budget deficit for FY11 (would have equaled about $630B; logic is that this number should equal about 6 months of relief from the debt ceiling--thereby moving us into FY12) AND to legislate a limit on the Budget Resolution for FY12, establishing a max limit of $2.95T (or what the administration projected for revenues in FY12; this is about $600B less than what the House passed this year for the FY12 budget (the Ryan plan)--so yes, it is playing hardball with the Congresscritters' penchant to spend). This plan would take the near-term debt ceiling debate past October 1st of this year by which time we would be operating under a new budget with the $2.95T cap; while the '12 budget would still likely effect an annual deficit, the above-passed ceiling increase would likely take the deficit limit past initial budget activities for FY13. Both parties would be able to then negotiate the next increase in good faith, with a clear understanding of how well the other side "partnered" to meet the fiscal challenges this country faces.

Of course, my plan would never pass the Senate--because there is so much to hate about a "clean" increase of the current debt limit and a budget resolution that is matched to a rosy projection of revenue for the year.

Or maybe there isn't much to hate about that. Maybe we should let the Senate decide. . .

The second part of my plan is still applicable, since it appears these debt limit talks are a feature of the future: Congress should pass a bill that tells the President the order of bills to be paid. For example: "when the federal government cannot meet all fincancial obligations, the Treasury shall ensure that the following bills are paid in order: (insert order here, but it would probably be along the lines of "interest payments to creditors; military personnel; social security payments; etc etc etc)." Again, there's little chance such a bill would be signed into law NOW. . .but there's a good chance it could get through the Senate and at that point it's kind of a crapshoot as Obama deals with his reelection concerns.