While President Obama signed into law Wednesday night the fiscal cliff package eliminating the most urgent threat to he U.S. economy, lawmakers have already pivoted to the next big partisan battle in Washington: raising the debt ceiling.
Senate Minority Leader Mitch McConnell (R-Kentucky), in a new op ed, staked out the Republican position in the upcoming fiscal fight, warning the GOP will not support raising the nation’s borrowing limit unless Congress commits to “long overdue reforms to spending programs that are the very cause of our debt.”
“The moment that he (President Obama) and virtually every elected Democrat in Washington signed off on the terms of the current arrangement, it was the last word on taxes. That debate is over. Now the conversation turns to cutting spending on the government programs that are the real source of the nation’s fiscal imbalance.” - Read more at Yahoo News
THE NEW DOOMSDAY: MARCH 1 On the first of March of this year, the mandatory sequestration cuts that made up half of the fiscal cliff will bluntly begin cutting defense and domestic budgets. On top of that, March 1 is also the day many expect the Treasury to exhaust its financing capacity, meaning Congress must raise the debt limit by then or the government will default on its debt, potentially causing a government shutdown and a credit downgrade. - Read more at Business Insider
BUSINESS LEADERS ON CLIFF DEAL Business leaders warned Wednesday that the cliff agreement does little to resolve the economic uncertainty that has hindered their businesses. Despite the markets’ favorable response to the passage of the fiscal cliff bill on Wednesday, analysts say the relief rally in the market won’t last long, since lawmakers will likely be engaging in a brutal battle over the debt ceiling through February – creating more economic uncertainty.
Ian Shepherdson, chief economist for Pantheon Macroeconomics, predicts the looming debt ceiling debate will be a “bloody, messy, appalling spectacle” among lawmakers that is likely to depress consumer and business sentiment. - Read more at The Fiscal Times
EXPERTS MIXED OVER DEAL’S MEANING The word on Wall Street is a mix of optimism and disappointment over the sweeping fiscal cliff package signed into law. Though many analysts agree the deal won’t cripple the economy, as no deal would have, most say it also won’t do much to strengthen growth this year and beyond. The Fiscal Times’ Yuval Rosenberg rounded up eight economists’ thoughts on the fiscal cliff deal and how it will impact the economy moving forward. - Read more at The Fiscal Times
‘FISCAL CLIFF’ TOPS BANISHED WORDS LIST: The phrase the “fiscal cliff” topped the Lake Superior State University’s “2013 List of Banished Words,” followed closely by “kick the can down the road” and “job creators.” Some speculate that “debt ceiling debacle” could get an honorable mention for 2014. - See the full list of LSSU’s banished words here