GOP & Dems On Verge of Bipartisan Budget Compromise

[r3volution 3.0]

Yeah, that's the new normal. They started suspending it instead of raising it about 4 or 5 years ago.

Here's a little short term prediction. I'll bet if they pass it the Dow makes a new high over the next couple days. But at around the same time the 10 year will break 3% and the market will re-crash.

That sounds about right.

We're already retesting the recent highs in the 10Y.

[devil21]

Unlimited everything.

When all charades of limitations on debt, spending, etc are gone it is a sure sign of the last gasps of the dollar! It's like going on a shopping spree right before you stop making the payments on a credit card you can't afford anymore.

[Swordsmyth]

Nancy Pelosi Won't Back Bipartisan Spending Plan Without Immigration Commitment From Ryan

https://www.zerohedge.com/news/2018-02-07/senate-plan-would-combine-debt-ceiling-hike-two-year-budget-deal

[pao]

They were obviously afraid to death of Rand's plan gaining momentum with the public.

[nikcers]

Sen. Rand Paul: Congress ignores its budgetary duties yet again

No, that’s not a repeat you’re seeing on the news.
Congress really is about to vote on yet another continuing resolution – its fourth in a row since the fiscal year started. But you can ignore the legislative speak and just remember that “continuing resolution” is shorthand for “Congress didn’t do its job.”

This funding measure lumps together the spending for all 12 departments of the federal government into a huge bill and continues to fund them without reforming or eliminating any wasteful spending.

The powers that be say, "Either vote to continue the deficit spending or shut the government down." While I don’t want to shut down the federal government, I also don’t want to keep open a government that borrows a million dollars every minute.

This year, the government will borrow nearly a trillion dollars. The overall debt now exceeds $20 trillion and threatens our national security. We have already had one shutdown, and we are now a third of the way through our fiscal year with no real budget in sight.

When was the last time Congress passed all of their spending bills? 1997. Only four times in 41 years has Congress done its job. That’s absurd.

It’s also unsustainable and a reckless abandonment of our responsibility – one that threatens our national security and limits our economic potential.

Last year, David Walker, former Comptroller General of the United States, told the Senate Federal Spending Oversight Subcommittee that, "Excessive levels of debt as a percentage of the economy can serve to reduce economic growth and job opportunities. It can also cause a ‘crisis of confidence’ in the U.S. dollar and much higher interest rates if the market ever decides that the federal government has lost control of its finances and is not willing to regain control over them."

The nearly $300 billion in interest we pay on the debt alone could fund seven cabinet departments and multiple agencies — combined.

Governing by continuing resolution allows this debt to keep piling up with no end in sight, and it also cripples our chance to get government’s wasteful spending under control through regular review and serious oversight of how federal agencies are using your money.

Just this week, another reminder of the urgency of the situation hit the headlines when Politico reported that the Pentagon’s Defense Logistics Agency has “lost track of hundreds of millions” of taxpayer dollars, having “failed to properly document more than $800 million in construction projects.”

One can only imagine what the first-ever full-scale financial audit of the Department of Defense will uncover – even as politicians pour on the pressure of a shutdown to demand we approve more spending regardless. Under the House-passed continuing resolution, the Department of Defense would be the only area funded for a full year. While defending this nation is our top constitutional priority, we are not making our country stronger by breaking our budget rules time and again.

Over the years, my office has identified billions in wasted taxpayer funds, including more than $560 million of waste in our recent Festivus report, which featured stories such as the IRS failing to recover nearly $80 million in “unallowable expenses” to government contractors, and our government spending more than $200 million building roads in Afghanistan while our own infrastructure lags behind in repairs.

But instead of reining in such abuse across government through the regular appropriations process, we are expected to bust the caps, ignore any restraint, and keep making our situation worse.

I’m not going to take it anymore. Leadership says, “Take it or leave it. Either vote for more debt or shut down the government."
I think there’s another way. That’s why I’ve introduced my Government Shutdown Prevention Act. My bill forces Congress to act or lose funding. If Congress doesn’t pass the individual appropriation bills as they are supposed to, government spending will be cut 1 percent.

It may not seem like much, but cutting 1 percent a year balances the budget in four years.
On Tuesday, my Federal Spending Oversight Subcommittee held a hearing entitled “Terrible, No Good, Very Bad Ways of Funding Government.”

I can’t think of a better way to describe out-of-control deficit spending, and I am urging the full committee to help stop this cycle and advance reform by voting on my legislation.

During Tuesday's hearing, Dr. Alice Rivlin, former director of the Office of Management and Budget and currently a senior fellow in Economic Studies at the Brookings Institution, thanked the subcommittee for calling “attention to the total breakdown of federal budgetary policy-making.” She went on to observe that she believed “this breakdown is a serious threat to our democracy and to America’s future prosperity.”

It’s high time someone says, “Enough is enough,” and fixes our terrible, no good, very bad budgetary process.
Sen. Rand Paul, a Republican, is the junior U.S. senator from Kentucky. He chairs the Senate Subcommittee on Federal Spending Oversight and Emergency Management. You can follow him on Twitter: @RandPaul.

http://www.washingtonexaminer.com/se...rticle/2648409

[Swordsmyth]

As more details emerged about today's bipartisan Senate budget deal, which will lift spending caps by $300 billion above the current limit and which prompted today's sharp Treasury selloff, it was revealed that the agreement would suspend the federal debt ceiling through March 1, 2019.
This, together with the generous spending terms which are sure to blow out the US budget deficit even more than recent troubling forecasts such as those from Goldman, which recently predicted US debt issuance would more than double, rising from $488bn in 2017 to $1,030 billion in 2018...

... prompted a revolt among GOP conservatives against the massive bipartisan deal, who complained that the GOP could no longer lay claim to being the party of fiscal responsibility.
"I’m not only a 'no.' I’m a 'hell no,'" snapped Rep. Mo Brooks (R-Ala.), one of many members of the conservative Freedom Caucus who left a closed-door meeting of Republicans saying they would vote against the deal.
According to The Hill, one of the Freedom Caucus leader, Rep. Dave Brat (R-Va.), called the budget "a Christmas tree on steroids."
"This spending proposal is disgusting and reckless — the biggest spending increase since 2009," conservative Rep. Justin Amash Mich.) tweeted after the meeting. “I urge every American to speak out against this fiscal insanity."
But the focal issue appears to be the debt hike, which is giving conservatives “heartburn,” said Rep. Dennis Ross (R-Fla.), a member of the GOP vote-counting team.
The swift backlash from fiscal hawks means that Speaker Paul Ryan (R-Wis.) and his leadership team will need dozens of Democratic votes to help get the caps-and-funding deal through the lower chamber to avert a government shutdown set for midnight Friday. At the same time, some Republicans predicted a majority of the majority would back the package.
Opinions were split on the chance of the budget's passage: Former Republican Study Committee (RSC) Chairman Rep. Bill Flores (R-Texas), who said he will probably support the agreement, estimated that about two-thirds of the lawmakers who spoke at the microphones during the closed-door meeting actually voiced support. Meanwhile, Rep. Mark Meadows (R-N.C.), the current Freedom Caucus chairman, predicted that the budget deal will get support from a majority of the majority, but not enough to pass without Democratic votes.
It’s unclear how many Democrats will support the plan without concessions from Ryan, given immigration demands from House Minority Leader Nancy Pelosi who on Wednesday evening concluded an 8 hour filibuster on "dreamer" immigrants.

More at: https://www.zerohedge.com/news/2018-...n-debt-ceiling

[Zippyjuan]

The powers that be say, "Either vote to continue the deficit spending or shut the government down." While I don’t want to shut down the federal government, I also don’t want to keep open a government that borrows a million dollars every minute.

This year, the government will borrow nearly a trillion dollars. The overall debt now exceeds $20 trillion and threatens our national security. We have already had one shutdown, and we are now a third of the way through our fiscal year with no real budget in sight.

Is that why Rand voted for the tax cuts which will add even more to that debt and deficits and increase government borrowing? If he is truely against debit/ deficits he should have voted against it.

It’s also unsustainable and a reckless abandonment of our responsibility – one that threatens our national security and limits our economic potential.

[Swordsmyth]

Is that why Rand voted for the tax cuts which will add even more to that debt and deficits and increase government borrowing? If he is truely against debit/ deficits he should have voted against it.

He would do what he is doing, voting for tax cuts and against spending, because he knows both are necessary and that government debt while bad is not as bad as crushing taxes.

Inflation through debt and printing is actually the perfect form of taxation, there are 0 compliance costs and it affects all existing money equally, plus there is no need for force to be used.
The only drawback is that it is too perfect, the people don't feel the pain immediately and the politicians are encouraged to spend like drunken sailors on unlimited credit and to enrich cronies by giving them the government contracts and subsidies that give them the new money while it can be spent at the old value because the market hasn't felt it yet.

[Madison320]

After what happened today in the markets my guess is they won't pass the bill. People are actually starting to worry about the deficits. The problem is most of them are blaming it on the tax cuts, not the true problem which is spending.

The democrats are crazy if they vote against this. It's almost a sure thing that they'll take back all 3 branches by 2020 if they pass this monstrosity when the economy collapses.

[Madison320]

Inflation through debt and printing is actually the perfect form of taxation, there are 0 compliance costs and it affects all existing money equally, plus there is no need for force to be used.
The only drawback is that it is too perfect, the people don't feel the pain immediately and the politicians are encouraged to spend like drunken sailors on unlimited credit and to enrich cronies by giving them the government contracts and subsidies that give them the new money while it can be spent at the old value because the market hasn't felt it yet.

I've been thinking about this lately. You're right that's it's more voluntary, as long as you avoid the inflation tax. My first instinct is that if you went all in on this (no taxes only debt and printing) you'd instantly hyperinflate the currency. I'll have to think about it some more.

[Swordsmyth]

I've been thinking about this lately. You're right that's it's more voluntary, as long as you avoid the inflation tax. My first instinct is that if you went all in on this (no taxes only debt and printing) you'd instantly hyperinflate the currency. I'll have to think about it some more.

I would support "printing only" inflation tax if it weren't for the drawbacks I pointed out.

[Swordsmyth]

Sen. Rand Paul was blocking the Senate's move to quickly pass its massive budget deal Thursday with only about six hours until government funding lapses.
For the Senate to hold a vote on the spending package Thursday, all senators must agree. The Kentucky Republican held out as he sought a vote on an amendment to maintain budget caps, arguing that the proposal spends recklessly.
As the impasse dragged on to 6 p.m., ET, it boosted the chances of Congress failing to pass a spending bill before midnight. Even if the Senate approves the legislation Thursday night, a skeptical House still needs to pass it and get it to President Donald Trump's desk.
Shortly before 6, Senate Majority Leader Mitch McConnell took to the Senate floor and urged Paul to stop his objections and instead raise a budget point of order. The senior Kentucky Republican said, "I would argue that it's time to vote."
Senate Minority Leader Chuck Schumer then said: "We're in risky territory here." He argued that the Senate did not have the time to vote on Paul's amendment because other lawmakers would bring up amendments, as well.
McConnell requested to start a vote series on the plan, arguing that Paul could make his point about budget caps with a budget point of order. Paul objected, continuing the stalemate.
"I can't in all good honesty, in all good faith, just look the other way because my party is now complicit in the deficits," the senator said on the Senate floor.
"What you're seeing is recklessness trying to be passed off as bipartisanship," he later added.
Paul signaled that he could keep the Senate debating until 3 a.m., ET, Friday to prove his point. That would take the chamber past the shutdown deadline.

More at: https://www.cnbc.com/2018/02/08/shut...dget-vote.html

[r3volution 3.0]

Sen. Rand Paul was blocking the Senate's move to quickly pass its massive budget deal Thursday with only about six hours until government funding lapses.
For the Senate to hold a vote on the spending package Thursday, all senators must agree. The Kentucky Republican held out as he sought a vote on an amendment to maintain budget caps, arguing that the proposal spends recklessly.
As the impasse dragged on to 6 p.m., ET, it boosted the chances of Congress failing to pass a spending bill before midnight. Even if the Senate approves the legislation Thursday night, a skeptical House still needs to pass it and get it to President Donald Trump's desk.
Shortly before 6, Senate Majority Leader Mitch McConnell took to the Senate floor and urged Paul to stop his objections and instead raise a budget point of order. The senior Kentucky Republican said, "I would argue that it's time to vote."
Senate Minority Leader Chuck Schumer then said: "We're in risky territory here." He argued that the Senate did not have the time to vote on Paul's amendment because other lawmakers would bring up amendments, as well.
McConnell requested to start a vote series on the plan, arguing that Paul could make his point about budget caps with a budget point of order. Paul objected, continuing the stalemate.
"I can't in all good honesty, in all good faith, just look the other way because my party is now complicit in the deficits," the senator said on the Senate floor.
"What you're seeing is recklessness trying to be passed off as bipartisanship," he later added.
Paul signaled that he could keep the Senate debating until 3 a.m., ET, Friday to prove his point. That would take the chamber past the shutdown deadline.

More at: https://www.cnbc.com/2018/02/08/shut...dget-vote.html

I'm afraid it's still going to pass, but anything we can do to highlight the uselessness of 99% of the GOP is worth doing.

[r3volution 3.0]

Inflation through debt and printing is actually the perfect form of taxation, there are 0 compliance costs and it affects all existing money equally, plus there is no need for force to be used.

Measures would have to taken to compel people to accept the paper being printed, especially absent normal taxes (which create guaranteed demand for the paper, even if no one otherwise wants to use it), so there would still be collection costs (and force) associated with pure inflation finance. It also doesn't affect all money equally (Cantillon effects). That said, I've thought about this too and, on a small enough scale, with government spending at appropriate levels (say $200 billion per year), this might actually be an efficient form of tax collection compared to income tax, sales tax, etc.

[r3volution 3.0]

#RandPaul is doing a great job tonight. His father must be proud. If only he was our president. The only chance the Republicans will have in 2020 is if Paul primaries Trump and wins the nomination.

...

[r3volution 3.0]

What kind of politicians rail against deficit spending until they are in charge AND THEN SPEND MORE? I stand with Rand @RandPaul against congressional Republicans who have rejected their core values

...

[TheCount]

Inflation through debt and printing is actually the perfect form of taxation, there are 0 compliance costs and it affects all existing money equally, plus there is no need for force to be used.

People mock Zippy for his economic posts... and yet this will slip by without any of the usual suspects howling in here to call you a Soros troll.

Massive money supply expansion is far from a guaranteed thing... the US has been extremely fortunate that it has not felt a larger impact of the effects of its policies thus far. The political and economic position of the US in the world has a fair amount to do with it. Such a plan would ruin that, and the economy as well.

The only drawback is that it is too perfect, the people don't feel the pain immediately and the politicians are encouraged to spend like drunken sailors on unlimited credit and to enrich cronies by giving them the government contracts and subsidies that give them the new money while it can be spent at the old value because the market hasn't felt it yet.

There are other affects as well. It discourages saving and encourages immediate consumption, for example. It distorts the costs of any long-term project. Would overall discourage the use of the dollar both domestically and internationally. People prefer currencies to have stable values.

My first instinct is that if you went all in on this (no taxes only debt and printing) you'd instantly hyperinflate the currency.

You're correct. No bank or individual would want to hold dollar-denominated bonds given a explicit government plan to destroy their value. The interest rates on the bonds would skyrocket; they'd have to or nobody would buy your bonds in the first place. Everything would be exponential from there... government sells more bonds at even higher interest in order to pay the interest on past bonds... those additional sales generate a even higher interest rate... and so on.

[Swordsmyth]

People mock Zippy for his economic posts... and yet this will slip by without any of the usual suspects howling in here to call you a Soros troll.

Massive money supply expansion is far from a guaranteed thing... the US has been extremely fortunate that it has not felt a larger impact of the effects of its policies thus far. The political and economic position of the US in the world has a fair amount to do with it. Such a plan would ruin that, and the economy as well.



There are other affects as well. It discourages saving and encourages immediate consumption, for example. It distorts the costs of any long-term project. Would overall discourage the use of the dollar both domestically and internationally. People prefer currencies to have stable values.




You're correct. No bank or individual would want to hold dollar-denominated bonds given a explicit government plan to destroy their value. The interest rates on the bonds would skyrocket; they'd have to or nobody would buy your bonds in the first place. Everything would be exponential from there... government sells more bonds at even higher interest in order to pay the interest on past bonds... those additional sales generate a even higher interest rate... and so on.

The additional drawbacks you point out are the result of the ones I pointed out, if government was miserly on it's spending then the inflation would hardly be felt and would be less than economic growth, that would mean apparent deflation and you wouldn't have the extra problems you point out, also printing only without borrowing would eliminate the bond problems.

However as I said I am against the idea because you WILL have the problems I stated and they will lead to most of the problems you added even if you just print and don't borrow, and if you borrow you will get all of the problems you pointed out.

[Swordsmyth]

For the second time in one month, the US government will be shut down... if only for 3-6 hours, and potentially much longer.
As we explained earlier, a last minute Senate vote to approve the bipartisan "budget-busting, cap-lifting, debt-ceiling extending" two year budget deal is on hold at the moment as Kentucky Sen. Rand Paul prevents its advancement. Furthermore, as discussed earlier, the White House has instructed critical agencies to begin shutdown preparations for a government shutdown should a deal not be reached before midnight when the funding lapse expires.
This now appears certain because as Bloomberg reports, according to House majority whip Steve Scalies, "At this point, we expect next votes in the House to occur at very roughly 3:00-6:00 a.m."

And since midnight is the deadline for a deal, that would guarantee at least a short U.S. government funding lapse, and potentially a protracted one if for some reason the scheduled vote is once again delayed.

More at: https://www.zerohedge.com/news/2018-...after-deadline

[Swordsmyth]

The Senate early Friday morning passed legislation to keep the government open, nearly two hours after federal spending authority lapsed and a partial but temporary government shutdown took effect.
The bill funds the government through March 23, and Senate passage was set to be followed quickly by House passage before the effects of the shutdown were felt.

More at: http://www.washingtonexaminer.com/se...rticle/2648622

[Madison320]

For the second time in one month, the US government will be shut down... if only for 3-6 hours, and potentially much longer.
As we explained earlier, a last minute Senate vote to approve the bipartisan "budget-busting, cap-lifting, debt-ceiling extending" two year budget deal is on hold at the moment as Kentucky Sen. Rand Paul prevents its advancement. Furthermore, as discussed earlier, the White House has instructed critical agencies to begin shutdown preparations for a government shutdown should a deal not be reached before midnight when the funding lapse expires.
This now appears certain because as Bloomberg reports, according to House majority whip Steve Scalies, "At this point, we expect next votes in the House to occur at very roughly 3:00-6:00 a.m."

And since midnight is the deadline for a deal, that would guarantee at least a short U.S. government funding lapse, and potentially a protracted one if for some reason the scheduled vote is once again delayed.

More at: https://www.zerohedge.com/news/2018-...after-deadline

I actually watched a little bit of Rand Paul live last night and it was pretty interesting. He was calling out the other republicans big time.

The republican party just committed hari kari. They just paved the way for a socialist in 2020.

[r3volution 3.0]

[r3volution 3.0]

Notable fake conservatives, who voted Yay last night, include Ted Cruz and the following members of the House Freedom Caucus:

Ron DeSantis
Scott DesJarlais
Randy Weber

There were two HFC members who didn't vote at all (I'd want to know why [illness?] before condemning them)

Rod Blum
Jim Bridenstine

Then, of course, though this wasn't really hypocrisy, since he never pretended to be anything but a big spending leftist:

Just signed Bill. Our Military will now be stronger than ever before. We love and need our Military and gave them everything — and more. First time this has happened in a long time. Also means JOBS, JOBS, JOBS!

[Valli6]

QUESTION: On Motion to Concur in the Senate Amdt to the House Amdt to the Senate Amdt
BILL TITLE: The Bipartisan Budget Act of 2018
http://clerk.house.gov/evs/2018/roll069.xml#N

[CCTelander]

MAGA!

[r3volution 3.0]

Oh @dannno Paging @dannno ...

What's the Trumpsplanation on this, on his signing a massive spending increase into law, or have the talking points not come out yet?

[timosman]

Oh @dannno Paging @dannno ...

What's the Trumpsplanation on this, on his signing a massive spending increase into law, or have the talking points not come out yet?

I find it interesting somebody so full of it is trying to appear as a Justice Warrior.

[dannno]

Oh @dannno Paging @dannno ...

What's the Trumpsplanation on this, on his signing a massive spending increase into law, or have the talking points not come out yet?

Well if I had to take a wild guess based on the 4D chess model, I would have to say that from a strategic standpoint he has to give some things to get some things that he wants. So, a tax cut for corporations and individuals, cuts in regulations, a wall, vital infrastructure spending, maybe a better health care deal, these things he wants to lock down earlier in his term. He probably wouldn't be able to get them if he was demanding massive spending cuts at the same time.

Once he gets these things, however, a few of which he has already locked down, then he can demand massive spending cuts later in his term.

[undergroundrr]

They made America less again.

[r3volution 3.0]

Well if I had to take a wild guess based on the 4D chess model, I would have to say that from a strategic standpoint he has to give some things to get some things that he wants. So, a tax cut for corporations and individuals, cuts in regulations, a wall, vital infrastructure spending, maybe a better health care deal, these things he wants to lock down earlier in his term. He probably wouldn't be able to get them if he was demanding massive spending cuts at the same time.

Once he gets these things, however, a few of which he has already locked down, then he can demand massive spending cuts later in his term.

I don't know if that's going to sell.

Better put the PR team back on the job for a second draft.