Punks

The best debt negotiation quote yet:

Since pulling the plug on the deal, Boehner has been largely silent in the meetings, leaving House Majority Leader Eric Cantor (R-Va.) to present details of the House’s position. On Tuesday, people in both parties said, Obama tried to reestablish Boehner’s primacy.

Cantor, who is advocating a smaller deal, at one point demanded that Obama offer the details of his vision for a “grand bargain.”

“Where’s your paper?” he asked angrily.

Obama snapped back: “Frankly, your speaker has it. Am I dealing with him, or am I dealing with you?”

It was all revealed today. At the highest level, it's House Majority Leader Eric Cantor (R-VA) doing his "young guns" power-grab over House Speaker John Boehner (R-OH) fueled by the Tea Party he's grabbed onto. His PPT was leaked today, no compromise on revenue generation at all:

Eric Cantor July Slides

Today the business leaders hit back. At the GOP:

The message, sent in a letter to President Obama and every member of Congress, puts pressure on GOP lawmakers, who have staked out an uncompromising stance against raising taxes in the partisan wrangling over the country’s borrowing limit.

Republicans rely heavily on corporations for political support and have regularly cited the opinions of these “job creators” in their opposition to new tax revenue. Many of the House GOP freshmen most opposed to a compromise were swept into office with the help of financial support from groups behind the letter.

But the business community, which has largely kept quiet on the issue until now, does not uniformly share the Republican orthodoxy on taxes, according to some lobbyists who helped craft the statement.

The letter conspicuously avoided any mention of tax revenue partly because of differences of opinion among executives over whether to compromise on taxes to get a deal done, said a senior industry lobbyist, who spoke on the condition of anonymity because the internal deliberations were private.

“The debt default would be exponentially more painful than anything else,” said another senior executive at a major business lobbying group.

Obama has won the war of governance. The GOP is my way or the highway, and Senate Minority Leader Mitch McConnell (R-KY) found himself squeezed between the idiot Tea Party faction that thinks defaulting on the debt won't lead to world economic depression the loss of global American currency dominance that keeps us on top of the world, and the U.S. Chamber of Commerce, normally their biggest ally. No sane business in the country wants the U.S. to default and interest rates shoot through the roof -- if you can even get a loan.

So McConnell releases his Plan Z, panic mode, where they'd just keep holding short term votes to raise the debt without any cuts truly tethered. The idea is they keep the U.S. from defaulting but keep their members from having to vote on a Grand Bargain with any tax revenues, whether through closing loopholes or raising marginal rates on high income.

The result: his own party turns on him:

"It's Time to Burn Mitch McConnell in Effigy," read the headline on a post by Red State's Erick Erickson. He later changed it, writing "I decided to make the title less incendiary."

The new version? "Mitch McConnell Just Proposed the 'Pontius Pilate Pass the Buck Act of 2011.'" A sample:

So fearful of being blamed for a default, McConnell is proposing a compromise that lets Barack Obama raise the debt ceiling without making any spending cuts at all. Consider sending McConnell a weasel as testament to his treachery.

The generally more polite Heritage Foundation took aim at McConnell's plan as well.

"The plan that we are reading reports about today is a serious walk back," Heritage blogger Ashe Schow wrote, "and would seemingly trade the leverage needed to achieve reforms in return for political gains."

The NY Times is already capitulating to McConnell's plan (hang it on Obama through the election), which I don't think Obama wants but might be able to live with if he can a Grand Bargain separately. But it appears we're in an interesting Obama-jitsu moment, where he's used his opponents own weight to create a reversal on them.

They wanted cuts, he's brought the cuts. They wanted to lower the deficit, he's offering a huge deal to do it. They wanted to use the leverage of the debt limit, their threat to let the U.S. slide into fiscal default for the first time in our history, after raising the debt limit 19 times for their own El Presidente George W. Bush and his wars which we are still fighting; he's got the leverage now, at least for the moment.

Either Boehner comes out of this strengthened for letting Cantor play out, or there's going to be total civil war in that party. They're paying the devil's price for having the ranking extremists, the tea-ideologues with their pitchforks, and the most stratified capitalists in the same Party. It's only a hatred of taxes -- and government spending that doesn't just go directly to them in the form of Medicare, Social Security, big government project spending or tax credits. They don't even agree on "values" issues.

Is this the granddaddy of all teachable moments?