Debt Ceiling

Boehner: 'Beyond My Control' How Ratings Agencies Treat My Debt Limit Plan

Brian Beutler | July 28, 2011, 2:46PM

House Speaker John Boehner (R-OH)

House Speaker John Boehner (R-OH) doesn't sound all that confident that his debt limit bill would pass the smell test with credit ratings agencies, all of which are watching this debate closely.

At his weekly Capitol briefing, a reporter asked him if he believed his legislation, if enacted would allow the U.S. to maintain its AAA credit rating. Boehner wouldn't bite. "That is beyond my control," he said. "All I know is that this bipartisan bill is as large a step as we're able to take at this point in time that is doable, and signable and to become law."

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Debt Ceiling

O'Malley: Eric Cantor And 'Dinosaur Wing' Of GOP Already Hurting States In Debt Limit Fight

Brian Beutler | July 20, 2011, 2:10PM

Gov. Martin O'Malley (D-MD)

The ratings agency Moody's is threatening to reduce the rating of five states with AAA credit (along with the rating of the federal government) if Congress fails to raise the debt limit in early August. Now the governor of one of those states -- Maryland's Martin O'Malley -- is publicly singling out the Republicans in Congress who are preventing swift action on the debt limit.

"All of this brinksmanship and these threats of the dinosaur wing of the Republican party led by Eric Cantor to drive us needlessly into a default have impacted confidence I think throughout the country," O'Malley told me in a Tuesday interview. "It's impacted consumer confidence, it's impacted investor confidence, it's impacted the confidence of small businesses who are the backbone of this economy and who need to hire again. In that respect it's already had an effect. The closer we get to this deadline, and the more immediate ramifications that has for those of us that are going out into the bond market."

These concerns will become very real if Congress doesn't raise the debt limit in the next few days.

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Stimulus

Republicans Falsely Claim Obama Advisers Burying Data 'Proving' Stimulus Is Hurting Economy

Brian Beutler | July 5, 2011, 2:51PM

House Speaker John Boehner (R-OH)

Republicans are citing data from President Obama's Counsel of Economic Advisers to argue that the stimulus has cost the economy nearly 300,000 jobs in the past few months.

The claim originated Sunday at the conservative Weekly Standard and has quickly mushroomed into a talking point: It's been cited already by both Douglas Holtz-Eakin -- an influential Republican economist -- and House Speaker John Boehner. And it supposedly explains why the White House unveiled the report on the Friday before a holiday weekend.

There's just one problem: it's false.

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Debt

Republicans Find A Tax Cut They Don't Like -- One That Helps Obama

Brian Beutler | June 29, 2011, 5:50AM

Sen. Jon Kyl (R-AZ)

Let's assume Democrats and Republicans team up in the next few weeks to pass a very GOP friendly debt reduction bill. And let's stipulate, too, that, as in Britain and elsewhere, the spending-cut magic doesn't do anything to help the unemployment crisis, leaving President Obama and the Democrats a huge political liability -- and national problem -- they won't be able to resolve by election time in November.

[TPM SLIDESHOW: Battle Over The Budget: Behind The Scenes At The White House]

This is why they're trying to squeeze something -- anything -- into the debt ceiling package that will provide near-term stimulus, to improve the jobs situation or at least counteract the austerity measures. Unfortunately, Republicans have foreclosed on the highest-impact ideas economists have recommended -- aid to states, infrastructure investment, and other direct spending projects.

So they've settled on a fourth- or fifth-best option: a plan to provide employees deeper, temporary relief from the payroll tax, and extend that relief to employers as well. It's not the most stimulative thing in the world -- but it is a tax cut for business owners, so at the very least it should have some buy-in on the right, no?

You might think so, but you'd be wrong.

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Debt Ceiling

Top Economist: Even Brief Default Will Cause New Recession And Blow Recovery 'Out Of The Water'

Brian Beutler | June 28, 2011, 11:39AM

Moody's Analytics chief economist Mark Zandi

How big are the stakes on Capitol Hill right now? According to one of the most influential economists in federal policy making, the next four weeks will make the difference between a slow glide toward economic recovery, and a severe tumble into a new recession.

[TPM SLIDESHOW: More Than Just Forms: Tax Day Tea Party-Style]

Moody's chief economist, and former McCain economic adviser Mark Zandi is forecasting GDP growth of 4 percent by the end of the year and into next. But in response to a question from TPM, he told reporters at a breakfast meeting hosted by the Christian Science Monitor that his forecast would be "blown out of the water," if Congress fails to "reasonably gracefully" raise the national borrowing limit.

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Moody's

Moody's: Political Ad Revenue To Smash Records In 2012

David Taintor | June 23, 2011, 1:10PM

From a Conway campaign ad, "Why?"

The 2012 election season promises to be a boon for broadcasters.

Moody's Investment Services predicts political advertising revenues will grow 9 percent to 18 percent above the record-breaking 2010 election levels, according to a report released Tuesday.

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Debt ceiling

Experts: Even Brief Default Could Blow Up The Economy

Benjy Sarlin | June 9, 2011, 2:12PM

Concerned by the recent rhetoric surrounding the debt limit debate, Fitch recently put out a memo threatening to downgrade the US government's credit rating if Congress failed to reach a deal by August. Other ratings agencies have issued similarly dire warnings, including Moody's, who said they may strip the US of its prized AAA bond rating by mid-July if the standoff hasn't been resolved.

But ratings alone are relatively abstract. The real question is exactly how bad things would get in such a scenario. Experts who talked to TPM are divided on how much damage would remain after a brief default, but many are concerned that serious long-term consequences in the bond market are possible. If investors becomes spooked, they warn, interest rates on Treasury bonds could spike, a result that would drive up the deficit even further and put pressure on an already depressed housing market.

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