Autumn Chaos: Five Reasons To Fear Shutdown, Default

For all the gridlock in the age of President Obama and divided government, Congress has always, somehow, managed to avert a shutdown of the federal government and a catastrophic default on U.S. debt. And so many expect it to pull it off again when government funding runs out on Sept. 30 and the country’s borrowing authority expires later this fall.

But a confluence of factors makes it a more daunting task this time. Here are five reasons why a government shutdown, default, or both, are very real possibilities.

1. Boehner’s Unrealistic Promises To Rowdy House Republicans

The single biggest question mark in the fight to keep government open and avoid default is the rambunctious House Republican majority, which is chock-full of politically inexperienced members who were sent to Washington to shatter the status quo. And they view these fiscal deadlines as their only real leverage to force the reforms that conservatives crave.

After cutting deals since 2011 that fell short of their sky-high demands, they’re more determined than ever to take government funding and a debt limit hike hostage to achieve goals like massive spending cuts, an unwinding of Obamacare and major entitlement reforms.

Conservative lawmakers point to promises Speaker John Boehner (R-OH) made earlier this year when he said he won’t permit another debt ceiling increase without major concessions from Democrats. He has held firm to that demand, setting expectations high, and has even promised GOP members he won’t take part in private negotiations with the White House.

“We’re not going to raise the debt ceiling without real cuts in spending. It’s as simple as that,” Boehner said. Weeks earlier, he called on Obama to come to the table.

2. Obama’s Vow Not To Negotiate Over The Debt Ceiling

As determined as Boehner and Republicans are to force reforms in exchange for raising the debt limit, President Obama, backed by Democratic leaders, has been emphatic that he’ll refuse to negotiate over paying the bills Congress has racked up.

Obama regrets letting House Republicans take the American and global economy hostage to ideological ends back in 2011, when Congress came within two days of disaster, and is determined not to make that mistake again. It was one thing to cede to GOP spending demands after his party’s shellacking in the 2010 midterm elections, but it’s another to cave after he trounced them in 2012. As he sees it, the debt limit is Congress’s problem, and if he stands firm, the Republicans will ultimately have no choice but to raise it.

“We are not negotiating on the debt ceiling,” Obama told Democrats late July.

When he took the same position early this year, the last time the debt ceiling needed to be raised, Republicans caved and agreed to lift it temporarily without any substantive concessions.

“We are not negotiating on the debt ceiling,” Senate Majority Leader Harry Reid (D-NV) told reporters three weeks ago. “The President has said this. I’ve said it. And I don’t know how many more times we need to say that.”

3. McConnell’s Re-Election Battle

Despite his proclivities and talents for gumming up the works of Congress, Senate Minority Leader Mitch McConnell (R-KY) has had a knack for swooping in at the last minute and successfully negotiating deals to avert fiscal plunges, including shutdown and default. But this time, the unpopular incumbent is running for re-election and faces a strong conservative challenger who will compel him to shun the role of deal-maker.

“He’s very fearful of a challenger to his renomination,” said Norm Ornstein, a scholar at the conservative American Enterprise Institute. “And stepping in at the last minute to do a budget deal or save us from breaching the debt limit would be disastrous for him.”

Senior Democratic aides also worry that McConnell’s tea party challenge from Kentucky businessman Matt Bevin will make it harder to avoid these economic cliffs.

4. GOP’s Top Policy Negotiators Depart The Hill

The chief policy negotiators for Boehner and McConnell, who for years have been instrumental in securing and fleshing out deals to avoid fiscal disaster, won’t be around this time.

The departure of McConnell aide Rohit Kumar — whom one administration official described to the Washington Post as an “evil genius” with “a nose for the deal” — is a blow to the prospects of another accord. Kumar is believed to have a knack for melding policy with political reality in crucial moments. In many respects, the timing of his exit couldn’t be worse.

And in June, Boehner lost his top policy hand, Brett Loper, who became a lobbyist for American Express. Loper was the speaker’s chief liaison to the White House on fiscal policy negotiations. His departure means there will be one less player who was at the table when Congress, ultimately, avoided shutdown and default at crucial junctures in recent years.

5. Conservatives Demanding A Shutdown Over Obamacare

Conservative anxiety over Obamacare is reaching a fever pitch as the law’s major provisions are set to take effect in the coming months. And the base is using the month-long August recess to demand that Republicans withhold support for keeping government open after the Sept. 30 deadline unless the resolution strips funding to implement the health care law.

“You cannot say you are against Obamacare if you are willing to vote for a law that funds it,” said Sen. Marco Rubio (R-FL), one of the leaders of the effort. “If you’re willing to fund this thing, you can’t possibly say you’re against it.”

The push has led to something of a GOP civil war between leaders who recognize it’s a fool’s errand, and hardline conservatives who view the continuing resolution as their last chance to gut the law that they detest. Even if the GOP establishment prevails over its base, the right’s scorched-earth push will be a headache they couldn’t simply ignore.

One option would be to start by passing a continuing resolution in the House that defunds Obamacare, setting up a showdown with the Democratic-led Senate down the stretch. Another option, which Republican leaders are considering, is to instead take the debt limit hostage to their goal of dismantling Obamacare.

Buckle up. It’ll be a chaotic fall.

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