The House is a tougher case. The October compromise won the support of just 87 Republicans, while 144 opposed it. And the House of course has not taken up immigration reform, so there is no vote on that matter to provide us a with a sense of Republican flexibility.4 Getting a bill to end or ease sequestration through the House, then, seems a difficult prospect. What leverage do Obama, Reid, Nancy Pelosi, and amenable Republicans have?
The answer is the looming defense cuts. Again, back in 2011, the thinking was that Republicans would agree to avoid sequester’s imposition because, while they’re happy to see domestic programs chopped, they would want to protect the Pentagon. This assumption turned out to be wrong in early 2013. But there is some reason to believe—no one really knows how much—that this time, things might be different.
The $109 billion in cuts that sequestration imposes in 2014 were intended to be shared equally by defense and domestic programs. But because the fiscal cliff deal took a couple of steps to spare defense in 2013, the 2014 cuts will now tilt in the direction of hitting the Pentagon harder. The net result is that domestic programs in 2014 will be funded at almost exactly the same level as 2013 ($469 billion as opposed to $468 billion), while defense spending will actually fall in real dollars by $20 billion ($518 billion to $498 billion).
These cuts will be felt across the country. In every congressional district in America, numerous defense contracts are in place at any given moment. The most comprehensive study of this I’ve ever seen was completed by the conservative Center for Security Policy, which in August 2012 produced lists of extant Pentagon contracts and their dollar amounts in every district.5 The results are a revelation. In a typical district, more than one hundred defense contracts were in force; often, two hundred. They ranged from a few thousand dollars up to $5 million or $10 million or $20 million, or sometimes more.
Some of these employers are among the largest and most important in any given district. Defense spending plunged a hefty 22 percent in the fourth quarter of last year. Under the impending sequester scenario, more cuts like that are surely in store.
To some Tea Party people, this won’t matter: they believe they were elected to slash spending, and that is what they are going to do, the Pentagon included. But it’s not unreasonable to think that some of those 144 who opposed the shutdown deal might prove susceptible to pressure from major defense contractors and employers in their districts. It’s also a plausible thought that John Boehner, so thoroughly mocked after being led around by the nose by his caucus’s extremists, won’t let that happen again and will make an attempt, for a change, to govern. His abject admission to Obama after the shutdown—“I got overrun”—will be the three words his speakership is remembered by, unless he does something dramatic between now and what a number of observers expect will be his retirement next year.
Lifting the sequester will be difficult, but there’s another bullet that it now appears can be dodged, at least before the midterm elections: entitlement cuts.
No sooner was the deal consummated in October than my inbox started filling up with messages from Fix the Debt, the Committee for a Responsible Federal Budget, and similar deficit-focused groups announcing that now that sanity had been restored to Washington, it was high time to move ahead with the crucial work of “getting our fiscal house in order,” as it’s often put, once and for all. Getting our fiscal house in order means a few things, not all of them objectionable; but more than anything else, it means cutting Social Security and Medicare. This is the great goal and desire of a debt-obsessed center that includes Pete Peterson, Alan Simpson, and Erskine Bowles (the cochairs of President Obama’s 2010 commission), The Washington Post editorial board, Paul Ryan and many other Republican legislators, a handful of centrist Democratic ones, and assorted scholars and think-tankers around the capital.
Cuts in entitlements would be the centerpiece of any “grand bargain” struck by the two sides, which is why—if, say, you watch MSNBC, the liberals’ cable channel—you see some liberals shudder visibly at the very mention of the phrase. Obama has been open to grand bargains in the past.
But Harry Reid has so far killed the prospects of such an idea. Reid impressed observers in October more than he probably ever has by holding firm to the principle that the Democrats would simply not negotiate with the bazooka of government shutdown aimed at their heads, and by keeping his caucus unified on that point. The week after the government reopened, Nevada Public Radio asked Reid about a grand bargain: “That’s all happy talk. I would hope that were the case but we’re not going to have a grand bargain in the near future.”
The same day, Paul Ryan agreed: “If we focus on some big, grand bargain then we’re going to focus on our differences, and both sides are going to require that the other side compromises some core principle, and then we’ll get nothing done.” These were fascinating words coming from Ryan, who has had his sights on cutting Medicare for years.
Spending on Social Security, Medicare, and Medicaid will need to be addressed at some point. As baby boomers retire, the programs will consume 14 percent of GDP twenty-five years from now, according to a September Congressional Budget Office report. Liberals who wish to hold the line on these programs (including paying Social Security to the very rich) might also remember that higher spending on them would probably leave less money for the kinds of domestic discretionary programs that they also wish to see supported—environmental protection, public investments in infrastructure, aid for children and students, and civil rights enforcement, to mention only a few.
But Democrats would be unwise to rush into a negotiation on these matters in the quasi-extortionate climate Republicans have created—especially considering that the GOP still won’t give an inch on raising needed revenues. So the best possible outcome for January is a “petite bargain,” built chiefly around a lifting of the sequester that will allow agencies to budget more rationally. The Republican position might be: we will lift the sequester for defense only. Democrats will again have to hold firm in opposition and hope that public opinion again lands on their side in sustaining basic notions of fairness, which I would expect it will.
Looming over all these questions politically is the future of the Tea Party, and where the Republicans go from here. The Tea Party base has so terrified Republican lawmakers since 2009 that they have in essence listened only to that wing of the party. As I observed in a column in The Daily Beast this October, one week after the shutdown, about half of Republicans in one poll disapproved of how the Republican Party was handling the negotiations.6 That half of the Republicans—millions of people—have effectively had very little representation in Washington during the Obama era.
This is starting to change. For the first time, an articulate dissenting group has been conjured into existence, Defending Main Street, designed to finance primary campaigns against Tea Party incumbents. Former Ohio Congressman Steve LaTourette, a moderate-to-conservative legislator in his day but not a Tea Partier, spoke of his plans in the kind of aggressive tone we associate with his adversaries: “Hopefully we’ll go into eight to ten races and beat the snot out of them.” In addition, Tom Donohue of the US Chamber of Commerce has said that the chamber will finance anti–Tea Party primary challengers. The chamber is on the whole a conservative organization, but it does support immigration reform and spending on infrastructure, and it and other business lobbies fret that Republican legislators no longer fear them. And Karl Rove and his Crossroads GPS group will join the battle on the “Main Street” side as well.
Across the scrimmage line, Ted Cruz and Sarah Palin and others are encouraging Tea Party challenges in order to get rid of a few of the more traditional conservative incumbents.7 So far, five such incumbents will face right-wing challengers next year: Kentucky’s Mitch McConnell (already trading some nasty punches with Matt Bevin, a wealthy bell manufacturer), South Carolina’s Lindsey Graham (a “community organizer for the Muslim Brotherhood,” according to one opponent), Tennessee’s Lamar Alexander, Kansas’s Pat Roberts, and Mississippi’s Thad Cochran. Liz Cheney, the former vice-president’s daughter, is challenging Mike Enzi, the GOP incumbent in Wyoming, and trying to wedge herself into the Tea Party template as well. Other challenges will surely materialize before the filing deadlines approach.
Lines are being drawn, and sides taken, even among the governors, usually immune to some extent from these Potomac fevers. Florida’s Rick Scott is pro–Tea Party, Ohio’s John Kasich is against. Palin, the ex-governor, has found a way to remain in the vanguard of the Tea Party movement. But the lead character in this drama is clearly Ted Cruz. One has to remind oneself sometimes that he is still in his first year as a senator. His skills as a demagogue and his instincts for getting attention, arousing his base, and traducing liberal sensibilities are unrivaled. He has been seen as a slicker and more educated version of Joe McCarthy, not without cause; and he even looks a little like him, in the way his eyes slope downward from the top of his nose.
The midterm elections will in all likelihood shape up as a referendum within the GOP on whether it wants to follow Cruz or reject him. Immediately after them, the presidential campaign, or at least the precampaign jockeying, will begin. Future budget fights, the shape of Obama’s final two years, indeed the condition of the economy, will turn to a considerable extent on whether the Tea Party movement shrivels or grows—whether old-guard Republicans have the fortitude to cage the beast they’ve been happy to see prowling the landscape wreaking havoc, until it started wreaking some on them.
4 By the way, on immigration: if the House fails to act this calendar year, as seems likely, the Senate vote is in essence voided, and it’s back to square one. ↩
6 See “No Country for Old Moderates,” The Daily Beast, October 24, 2013. ↩
7 It is still a category error to call practically anyone in the GOP a moderate, as some press reports do. You can count the truly moderate Republicans on Capitol Hill on one hand. ↩
By the way, on immigration: if the House fails to act this calendar year, as seems likely, the Senate vote is in essence voided, and it’s back to square one. ↩
See “No Country for Old Moderates,” The Daily Beast, October 24, 2013. ↩
It is still a category error to call practically anyone in the GOP a moderate, as some press reports do. You can count the truly moderate Republicans on Capitol Hill on one hand. ↩