Next big challenge is the debt ceiling. Current law limits the government's borrowing authority to $14.something trillion. When we hit that ceiling, sometime in a few weeks, we have a problem. No more borrowing, which means the government revenue takes a 40% hit. Note, it doesn't mean we default, it means a 40% reduction in the money Uncle has to spend. That's a lot. In theory such a spending reduction could be done, but the pain would be intense.
The house republicans have enough votes to prevent raising the debt ceiling. If John Boehner were to call out his troops, he has the votes to stop it.
Question, what should the Republicans demand as a quid pro quo for raising the debt ceiling?
They could go for a federal balanced budget constitutional amendment. That would make a lot of conservatives happy, but I doubt it would do much good. Too many lawyers to invent ways of spending money but calling something else. Plus there would have to be an escape clause for real emergencies. And pretty soon everything would be a real emergency.
They could demand legislation to end farm subsidies, road building subsidies, ethanol subsidies, every kind of subsidy under the sun.
They could demand a resumption of oil exploration, and permits to drill in the "Arctic National Wildlife Refuge" (ANWR for short).
They could demand curbing EPA.
They could try and pass Ryan's plan for Medicare, replacing the current cost-plus and cost-no-object system with a system of private insurance plus subsidies for the sicker and more needy elderly.
They could demand interstate sale of health insurance, and the right to import medicine from any reasonable first world country.
They could demand repeal of Obamacare, but that probably won't fly, Obama would rather take a 40% revenue hit than give up his baby.
We shall see what happens next.
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