Compared with previous projections, our revised base case scenario now assumes that the 2001 and 2003 tax cuts, due to expire by the end of 2012, remain in place. We have changed our assumption on this because the majority of Republicans in Congress continue to resist any measure that would raise revenues, a position we believe Congress reinforced by passing the act.Sen. John Kerry (D-MA) said it best himself today:
The meme is spreading: It's The Tea Party Downgrade. Next comes the Tea Party Recession, hopefully not Tea Party Depression.
"I believe this is without question the Tea Party downgrade," he said. "This is the Tea Party downgrade because a minority of people in the House of Representatives countered the will of even many of Republicans in the United States Senate who were prepared to do a bigger deal."
Kerry intimated that the "grand bargain" that President Obama initially negotiated with House Speaker John Boehner (R-OH), a package of larger spending cuts and revenue increases, was scuttled by a smaller group of Republicans who were unwilling to negotiate at any cost.
"There were some people in the Republican party - and Mitch McConnell even admitted this - who wanted to default," Kerry said. "He said there were people in his party who were willing to shoot the hostage. In the end they found that the hostage was worth ransoming."
Thank you, Tea Party. For revealing that you're willing to send America back into a deeper recession that will likely take longer to get out of -- watch those interest rates this week -- all because of your inflexible anti-taxation ideology.
Let's see how much support they have after the pension funds get hit.