Rep. Sander Levin expects Democrats to win debt showdown

Jul 19, 2011 Issues: Economy

He says tea party wants to destroy sense of community

While denouncing the “most intense and polarized atmosphere in Washington I’ve ever seen,” U.S. Rep. Sander Levin on Monday said he believes the U.S. borrowing authority will be increased by the Aug. 2 deadline, with the debt ceiling altered in a way that is more in line with the White House and congressional Democrats than Capitol Hill Republicans influenced by the Tea Party movement.

In an interview with The Macomb Daily, Levin predicted that the “cut, cap and balance” plan put forward by House Republicans will pass on a party line vote as early as today. But that proposal will be shelved by the Senate in favor of a plan similar to the proposal put forward by Senate Republican leader Mitch McConnell last week that would give President Obama wide discretion to lift the debt ceiling by $2.5 trillion and steer the debate on deficit-reduction provisions.

“The (GOP) notion that the consequences of not raising the debt ceiling would not be severe is simply wrong. The ramifications would be immense. There is no other rational choice,” said Levin, a Royal Oak Democrat who represents most of Macomb County.

A 40-year veteran of politics, Levin said he is determined to preserve federal funding where it has “major, major implications,” such as Medicare, Medicaid, education programs and unemployment insurance.

“There is some theater with what’s going on in Washington but there are also some major differences of opinion,” said Levin, the ranking Democrat on the powerful House Ways and Means Committee. “There … is a strong core in the Republican Party no who think compromise is an abdication.”

Levin said he believes 60 to 80 House Republicans will refuse to vote for any increase in the debt ceiling, registering their opposition to the revised McConnell plan. As a result, the Democrats must summon more votes to keep the government functioning past Aug. 2.

Economists have warned that a U.S. default would have catastrophic consequences. Bond rating agencies have already started making adjustments in case the federal government avoids default but comes up far short of funding its obligations in August. On Wall Street, the markets dipped on Monday in the first reaction to the increasingly tense debt showdown in Washington.

The House GOP’s cut, cap and balance plan would include a long-term, strict limit on federal spending, including support for a balanced budget constitutional amendment. An amendment, however, would require two-thirds support in the House and Senate, which is considered a political impossibility, before the long process of achieving approval from three-fifths of the states.

The House is set to pass the plan this week but analysts say it’s sure to stall in the Senate, where majority Democrats say it would lead to decimating budget cuts and make it harder to pass tax increases on the wealthy. The White House called the bill an “empty political statement” that Obama would veto.

While the White House and congressional Democrats denounce the GOP’s resistance to any revenue increases, including the elimination of corporate tax loopholes, Republican Sen. Tom Coburn chimed in with a plan that would cut federal spending by a staggering $9 trillion over a decade.

The plan by Coburn of Oklahoma is laced with politically perilous proposals like raising to 70 the age at which people can claim their full Social Security benefits. It would cut farm subsidies, Medicare, student aid, housing subsidies for the poor, and funding for community development grants. Coburn even takes on the powerful veterans’ lobby by proposing that some veterans pay more for medical care and prescription drugs.

The more modest Senate plan that’s in the works would apparently give Obama sweeping power to order increases in the debt limit totaling $2.5 trillion over the coming year without approval by lawmakers. It would take effect in up to three phases, allowing Republicans to register their opposition votes along the way.

The hope appears to be that after trying it their way, enough House Republicans will be able to stomach the emerging Senate plan to allow it to pass, though it’s plain there will have to be plenty of Democrats voting for it as well to make up for dozens of unyielding lawmakers unwilling to abandon their Tea Party promises.

Tea party lawmakers are insisting on the cut, cap and balance effort to try to put their stamp on the debate over the so-called debt limit, and GOP leaders — lacking other ideas that might win a majority in the Republican dominated House — were quick to give their OK at a spirited closed-door meeting on Friday.

Levin continues to express befuddlement at the Tea Party supporters’ urge to chop federal spending and “take our country back.” The congressman said that mentality ignores the social safety net and programs like Social Security, Medicare, Medicaid and college tuition assistance that built the middle class.

“I really don’t understand what they (Tea Partiers) mean, especially when they express this notion that they just want to ‘get the government to get out of way,’” he added.

“In my lifetime, there has been a peaceful revolution in the growth of the middle class. And that never would have happened without public-private partnerships that expanded health care and higher education and affordable housing. In (Macomb) County, this is a very different place than it was 30, 40, 50 years ago because of the sense of community that these people want to destroy.”