Democratic Senate leaders on the debt bill (video)

MSNBC-Maddow Show, video (14:45).

"Smash the Ceiling"

James Surowiecki(The New Yorker):

The truth is that the United States doesn’t need, and shouldn’t have, a debt ceiling. Every other democratic country, with the exception of Denmark, does fine without one. There’s no debt limit in the Constitution. And, if Congress really wants to hold down government debt, it already has a way to do so that doesn’t risk economic chaos—namely, the annual budgeting process. The only reason we need to lift the debt ceiling, after all, is to pay for spending that Congress has already authorized. If the debt ceiling isn’t raised, we’ll face an absurd scenario in which Congress will have ordered the President to execute two laws that are flatly at odds with each other. If he obeys the debt ceiling, he cannot spend the money that Congress has told him to spend, which is why most government functions will be shut down. Yet if he spends the money as Congress has authorized him to he’ll end up violating the debt ceiling. MORE...

Howie P.S.: This seems like a very sensible point of view---too sensible for our politics today.

Ari Melber: "In Debt Address, Obama Asks Americans to Raise The Roof"

Ari Melber (The Nation):

President Obama did not say anything particularly new in his unprecedented deficit address to the Nation on Monday night. The most significant moment came not in an original announcement or last-minute proposal, but in the President's request that Americans actually get up, get involved, and ask Congress to lay off the insanity.
(SNIP)
In the end, the focus on process over tangible goals is most evident in a picture of Obama's verbal priorities. This chart, based on the frequency of Obama's word choices, does not suggest a single, overarching goal. After the obligatory salutes to Americans, the takeaway is more about technocratic process than a key priority at stake, or a hardball closing argument.

Apparently, it all comes down to our approach. MORE...

Robert Kuttner: "Obama Holds the Cards -- If He Will Play Them Well"

Robert Kuttner (The American Prospect):

At some point this week, stock and bond markets will begin to start swooning, and the usual wise guys will begin making high-risk bets at the expense of financial stability as a whole. Credit rating agencies, which should be accorded zero credibility after their role in causing the financial collapse by blessing junk sub-prime securities as Triple-A, could start downgrading the debt of the United States.

And then things will get really interesting. The President of the United States will be revealed to be holding more of the cards -- if he has the nerve to start playing his hand well (for a change).

At that point, there are only two basic choices. Either the Republicans and the White House agree to some kind of short- or medium-term increase in the debt ceiling, in exchange for some kind of deal with details to be supplied later. Or the president invokes the 14th Amendment and declares that the debts of the United States will be paid. MORE...

Elizabeth Drew on Obama and the debt limit: "What Were They Thinking?"

Pete Souza/White House---President Barack Obama at a meeting with his advisers in the Oval Office, June 8, 2011

Elizabeth Drew (NY Review of Books):

Someday people will look back and wonder, what were they thinking? Why, in the midst of a stalled recovery, with the economy fragile and job creation slowing to a trickle, did the nation’s leaders decide that the thing to do—in order to raise the debt limit, normally a routine matter—was to spend less money, making job creation all the more difficult? Many experts on the economy believe that the President has it backward: that focusing on growth and jobs is more urgent in the near term than cutting the deficit, even if such expenditures require borrowing. But that would go against Obama’s new self-portrait as a fiscally responsible centrist.

Lawrence Summers, Obama’s recently resigned chief economic adviser, said on The Charlie Rose Show in July that he found it “dispiriting” that “all of the energy is on the projected deficits…when the problem right now is that the economy is in danger of stagnating from lack of demand.” MORE...

H/t to Ari Melber and Booman. Gaius Publius (AMERICAblog) also comments on this and tosses Paul Krugman into the conversation.

Photos of the Day (with stories)

"Debt crisis: Deal sought to head off stock plunge" (AP):

Precariously short of time, congressional leaders struggled in urgent, weekend-long talks to avert an unprecedented government default, desperate to show enough progress to head off a plunge in stock prices when Asian markets open ahead of the U.S. workweek. MORE...

"It’s Wedding Day in New York!"(AMERICAblog):

It's a big day in the Empire State. At the stroke of midnight, marriages between same-sex couples became legal in New York. And, shortly thereafter, couples began getting married. MORE...

"Obama Takes On GOP; Angrily Defends ‘Working Stiffs’ Who Struggle Everyday" (with video)

MEDIAite with video (05:18) from CNN:

President Obama took to the White House briefing room podium Friday afternoon to take questions regarding the earlier collapse of the debt crisis negotiations between the administration and the GOP. A rather pedestrian press briefing suddenly turned spirited with last question posed by Huffington Post’s Sam Stein, who asked about market reaction on Monday. Mr. Obama seemed passionate, if not…well, pissed, with Speaker Boehner and other GOP leadership for the stalled talks. MORE...

Joan Walsh on compromise, Obama, the debt limit and Bernie Sanders

Joan Walsh:

The president sincerely believes that the intense polarization of American politics isn't merely a symptom of our problems but a problem in itself – and thus compromise is not just a means to an end but an end in itself, to try to create a safe harbor for people to reach some new common ground. I actually have some sympathy with that point of view. But having now watched two smart Democratic presidents devote themselves to compromise with Republicans, only to be savaged with increasing intensity, I've lost faith that compromise itself holds some healing magic. Maybe it just emboldens bullies.

All of that said, I don't agree with Sen. Bernie Sanders that Obama's compromising with the GOP means he should face a primary challenge. I've said it over and over: The left invests way too much energy and drama in presidential politics. If you want a better Democratic president, elect better Democrats to Congress and state legislatures. A primary next year would be an exercise in self-destruction. But I can say that without wanting to destroy Sanders. I hope Obama's staunchest supporters can do the same. MORE...

Rachel Maddow on Reagan and today's House GOP on the debt limit (video)

MSNBC-Rachel Maddow, video (13:58).

"Democrats erupt over latest plan on debt ceiling"

House Minority Leader Nancy Pelosi (D-San Francisco) was asked to the White House on Thursday evening along with Senate Majority Leader Harry Reid (D-Nev.) as President Obama tried to soothe Democrats. Many worried that he was retreating on has demand for new revenue to accompany slashes in federal spending. (Tom Williams, Roll Call / July 22, 2011)

Lisa Mascaro and Christi Parsons (LA Times):

As President Obama pushed hard for a grand deal to reduce the federal deficit, he ignited a furor among congressional Democrats on Thursday by appearing to retreat from his insistence that spending cuts and revenue increases be included in the same package. MORE...

Howie P.S.: Digby is also unhappy.

Greenwald: "Barack Obama is gutting the core principles of the Democratic party"

Glenn Greenwald:

Where is the "epic shitstorm" from the left which Black predicted? With a few exceptions – the liberal blog FiredogLake has assembled 50,000 Obama supporters vowing to withhold re-election support if he follows through, and a few other groups have begun organising as well – it's nowhere to be found. MORE...

Howie P.S.: It may not be "epic" but there is a shitstorm. Many on "the left" know that the federal budget is in the red over the wars, the tax breaks for the wealthy and corporate give-aways.

"Debt talks bring tensions between Democrats, Obama to surface"

Paul Kane (WaPo):

For the first time in weeks of debt negotiations that have focused on rifts within the Republican Party, Thursday brought forward long-simmering tensions between Obama and his Democratic allies on Capitol Hill.
(SNIP)
Sen. Dianne Feinstein (Calif.) pleaded to return to negotiations over a Reid-McConnell plan that contained no tax increases and no entitlement cuts.“This is a very sensitive time,” she said, trying not to directly criticize the White House.

Did she think the White House was working off the same page as her?

“No,” she replied. MORE...

"Ed Schultz and Bernie Sanders (and Donna Edwards): The Gang of Six Plan Will Devastate the Middle Class" (video)

MSNBC-The ED Show, video (14:42).

"Republicans to their leaders: Make a deal already"

Greg Sargent:

In case you needed further proof that the ground is shifting big time in the debt ceiling debate, consider this number from the new Post poll: Fifty eight percent of Republicans say their leadership is not doing enough to srike a deal, and seventy-nine percent of independents say the same about GOP leaders, versus 62 percent who say it about Obama.

This mirrors Gallup’s finding earlier this week that 57 percent of Republicans, and 72 percent of independents, want their leaders to reach a compromise even if they disagree with its contents. MORE...

Robert Reich: "The Dangerous Hi-Jinks of the GOP’s Juveniles"

Robert Reich:

I’ve spent enough of my life in Washington to take its theatrics with as much seriousness as a Seinfeld episode. A large portion of what passes for policy debate isn’t at all — it’s play-acting for various constituencies. The actors know they’re acting, as do their protagonists on the other side who are busily putting on their own plays for their own audiences.

Typically, though, back stage is different. When the costumes and grease paint come off, compromises are made, deals put together, legislation hammered out. Then at show time the players announce the results – spinning them to make it seem they’ve kept to their parts.

At least that’s the standard playbook.

But this time there’s no back stage. MORE...

"We’re Spent"

David Leonhardt (NY Times):

If governments stop spending at the same time that consumers do, the economy can enter a vicious cycle, as it did in Hoover’s day.

The prospect of that cycle is one reason an impasse on the debt ceiling, and a government default, could do so much damage. Global investors may be the only major constituency that has been feeling sanguine about the American economy. If Washington unnerves them, and sends interest rates rising, the effect really could be calamitous.

But the debt-ceiling debate doesn’t have to be yet another problem for the economy. The right kind of agreement could help soften the consumer bust and also speed the transition to a different kind of economy.

What might that agreement look like? MORE...

Obama Weekly Address: ‘I’m Willing To Compromise,’ I Expect Same Of Congress (video)

MEDIAite with video from CNN (03:54):

President Obama unsurprisingly devoted his weekly video address to the subject of the deficit negotiations and expressed some disappointment that a bi-partisan deal has yet to be reached. If former presidents Ronald Reagan and Bill Clinton were able to work with leadership in the opposing political party to reach compromise, Obama remains optimistic that now should be no different. MORE...

Howie P.S.: More from Jim Kuhhenn (HuffPo), "Obama Takes Debt Ceiling Case To The American People, Congress Seeks Bipartisan Plan":

Racing the debt clock, Congress is working on dual tracks while President Barack Obama appeals to the public in hopes of influencing a deal that talks have failed to produce so far.

"We have to ask everyone to play their part because we are all part of the same country," Obama said Saturday, pushing a combination of spending cuts and tax increases that has met stiff resistance from Republicans. "We are all in this together." MORE...

Daily Kos: "Abbreviated Pundit Round-up"

Charles Blow:

Last week I spent a few days in the Deep South — a thousand miles from the moneyed canyons of Manhattan and the prattle of Washington politics — talking to everyday people, blue-collar workers, people not trying to win the future so much as survive the present.

They do hard jobs and odd jobs — any work they can find to keep the lights on and the children fed.

No one mentioned the asinine argument about the debt ceiling. No one. Life is pressing down on them so hard that they can barely breathe. They just want Washington to work, the way they do. MORE abbreviated punditry from others HERE...

"President Obama says he's willing to put his job on the line over the debt limit debate" (video)

MSNBC-The ED Show, video (12:41).

Howie P.S.: Bernie Sanders joins in to comment.

Rachel Maddow: "GOP surrenders to economic reality" (video)

MSNBC-Rachel Maddow, video (15:14).