THE closer the federal government comes to hitting the limit imposed by Congress on its borrowing and thus defaulting on some of its obligations, the more frantically members of Congress churn out schemes to avert the impending disaster. As The Economist went to press, the House of Representatives was poised to vote on the latest plan, put forward by John Boehner, the speaker and leading Republican voice in the debate about the debt ceiling. But the measure’s prospects seem uncertain in the House and even bleaker in the Senate. Several more plans wait in the wings, but all face the same difficulty: passing muster both with the Republican scourges of government who run the House and the more reluctant budget-cutters from the Democratic Party in charge of the Senate and the White House. Meanwhile, the Treasury insists it will run out of money after August 2nd, whereupon it will have to stop paying at least some bills.
Since Republicans took control of the House at the beginning of the year, they have given warning that they will not simply wave through an increase in the debt ceiling, as Congress has usually done in the past. Never mind that in April a majority of them voted for an interim budget that assumed that the debt ceiling would be lifted, and for a longer-term budget resolution that would require it to leap by almost $9 trillion over the next decade. America’s deficits, they argued, were unsustainable, and the bargaining power conferred on them by the need to raise the debt ceiling presented a wonderful opportunity to stop the rot.
In a speech in May Mr Boehner explained that he would want dramatic reductions in government spending in exchange for an increase. “We should be talking about cuts of trillions, not just billions. They should be actual cuts and programme reforms, not broad deficit or debt targets that punt the tough questions to the future.” As recently as last week he was discussing just such a deal with Barack Obama, who despite having presented a spendthrift budget earlier in the year had professed a willingness to trim future deficits by as much as $4 trillion. On July 22nd, however, Mr Boehner withdrew from the negotiations, saying that Mr Obama was too eager to raise taxes—something that almost all Republicans in the House had sworn not to do. (By most accounts, Mr Obama was talking chiefly about eliminating or reducing loopholes and exemptions in the tax code, albeit on a grand scale.)
Even as Messrs Boehner and Obama were falling out, the Senate rejected a bill passed by the House that would have slashed spending next year, capped it in future and prevented the debt ceiling from being lifted until Congress approved an amendment to the constitution that barred the federal government from running deficits even as it made it harder to raise taxes. That, the Democrats complained, was far too draconian. The harried Mr Boehner responded on July 25th with a lesser measure that he said would cut spending by $915 billion, and raise the debt ceiling by a little less—only enough to keep the government going for about six months. The bill would also set up a panel of 12 congressmen to recommend another $1.8 trillion of cuts, which if enacted would prompt another $1.6 trillion rise in the debt ceiling. Tax rises would be ruled out from the start.
Many of Mr Boehner’s foot-soldiers in the House are unhappy with this proposal. They complain that it abandons the principles he laid out in May, by resorting to committees and spending caps rather than detailed reforms. Thirty-nine of them have vowed not to vote for any increase in the debt ceiling unless it is accompanied by a balanced-budget amendment—something that Mr Boehner’s bill only offers a vote on. Worse, the non-partisan Congressional Budget Office (CBO) declared on July 26th that his sums did not add up, prompting him to delay a vote on the bill while he rejigged it.
