Opinion: Columnists

Phillip Klein: Past the 'cliff,' debt ceiling promises a more brutal fight

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As a weary Washington assesses the "fiscal cliff" deal, a debt-ceiling showdown looms on the horizon. There are a number of reasons to believe that the standoff -- expected sometime in February or March -- will be even more difficult to resolve than the last debt-ceiling impasse in the summer of 2011.

In the 2011 showdown, House Speaker John Boehner established the principle that every dollar increase in the debt limit would have to be accompanied by a dollar cut in government spending. The final deal allowed for at least $2.1 trillion in debt-limit increases offset by promised spending cuts and did not raise taxes.

This time, however, it will be more difficult for Republicans to get Democrats to agree to spending cuts. In the summer of 2011, both parties were essentially placing bets on the outcome of the 2012 election. With Obama re-elected and Democrats still controlling the Senate, Democrats believe they are in a stronger position.

The 2011 debt-limit deal reduced projected spending by about $917 billion. There isn't much desire among victorious Democrats to cut discretionary spending further, and there is deep resistance to cutting mandatory spending by reforming the big entitlement programs -- Medicare, Medicaid and Social Security.

Congress is also running out of gimmicks. Scrambling to come up with further spending cuts during the 2011 debt-limit fight, lawmakers created a bipartisan, bicameral 12-member "super committee" tasked with finding at least $1.2 trillion in deficit reduction. In theory, the members would be motivated to act, or else face automatic cuts to defense and nondefense spending at the start of 2013. They failed to come up with a solution, but this week's fiscal cliff deal delayed the automatic cuts -- or sequester -- for another two months.

Not only will it be hard for Congress to get away with another tactic like this, but the continued desire to replace the sequester with different deficit reduction means that Boehner goes into the debt-limit debate $1.2 trillion in the hole. Any spending cuts Democrats would conceivably agree to as a substitute to the sequester would only pay for the 2011 debt-ceiling increase. To be consistent with Boehner's dollar-for-dollar principle and replace the sequester, Republicans would have to get Obama and Senate Democrats to agree to spending cuts above and beyond the $1.2 trillion.

For his part, Obama has insisted that he won't negotiate over the debt limit this time around. This is unlikely to hold, given the potential consequences to the federal government, financial markets and the economy if it is never raised. And the fact that he made the debt ceiling a part of ultimately fruitless fiscal cliff talks with Boehner means he's already negotiated over it.

In his comments following the passage of the fiscal cliff deal, Obama emphasized that the agreement enshrined the principle of a "balanced" approach in which spending cuts are exchanged for tax increases. So, even if Obama did negotiate over the debt limit, he is unlikely to agree to any spending cuts -- let alone trillions in cuts and fundamental entitlement reform -- without additional tax increases.

And from the Republican perspective, the tax debate is now closed. Income taxes have gone up by $617 billion, and the rich are now paying their "fair share." The final fiscal cliff deal was a bitter pill for Republicans to swallow, but they were able to do so only because of the unique circumstances in which tax rates were expiring anyway, so that inaction meant $4.5 trillion in tax hikes on nearly everyone. Absent that automatic expiration issue -- which ultimately forced even anti-tax crusader Grover Norquist to give Republicans a pass -- there is no reason Republicans would agree to a penny more in higher taxes.

If history is any guide, the smart money is still on lawmakers finding some way to cut a last-minute deal to avert -- or more likely defer -- a crisis. But the differences between the parties going into the debt-ceiling debate are more difficult to bridge than any we've seen in the last two years.

Philip Klein (pklein@washington examiner.com) is a senior editorial writer for The Washington Examiner. Follow him on Twitter at @philipaklein.

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