Fear: GOP Will Cave on Sunday, Agree to Hike Taxes with Fake Cuts
July 8, 2011
RUSH: There's a lot of deciphering that has to be done over that meeting yesterday on the debt ceiling. There's some really potentially disastrous things that could happen from this. I haven't been able to confirm 'em, and Boehner's denying it, but there are too many indications coming out that the House Republicans are going to cave on a number of things, such as more defense cuts than even Obama wants. Now, I'm hoping it isn't true, but I'm hearing it from too many different places. So we'll get into that in detail.
Now, Boehner, I was heartened by this because last night I was up late. The panic started at about 10:25 last night when people started e-mailing me with things that they had heard and press reports. It wasn't just things people had heard, there are very disturbing press reports, but they are press reports. There's a lot to decipher here, there's a lot to wade through, there's a lot of malarkey. And I was wading through it until early this morning, and I've got it all ready to present to you here today for you to learn and make up your own mind and apply your own thought to, as well as, of course, listen to my interpretation.
RUSH: All right, here's what got everything going last night. This is at 10:25. Now, I could have known this had I been watching the Fox All Stars earlier at 6:40 last night, but I wasn't. I didn't learn of this 'til somebody sent me the notation. Bill Kristol last night on Special Report on Fox predicted that the Republicans are gonna cave in a very big way on the debt ceiling negotiation. Now, that immediately caught my attention because all through the week I have been pretty steadfast in my confidence that they weren't gonna cave, that they could make Obama cave. If you've been listening all week you know what I've been saying, that Obama is at the weakest a president has been politically in a long time in this country. Why our guys don't realize it, we were talking yesterday, why is it that we continually fear that they fall for decade-old traps that the Democrats set. It's because they do. It's because they sometimes do fall for these traps.
So on Thursday's Special Report, Kristol said that the Republicans are gonna give in and agree to the terms set forth by the regime. Here's the quote. "It sounds as if it’s heading towards a deal. It’s not a deal that I’m going to like I suspect, and think I it’s going to be a bad deal for conservatives and Republicans but I think they’re intimidated. The president has been running around talking about corporate jets and the rich, and how the sky is going to fall unless Republicans cave. And I think they’re getting ready to cave in a pretty big way on Sunday." Which is the next meeting. Obama canceled another vacation, was gonna go to Whitefish, Montana on Sunday but then he discovered that if he made these guys work on Sunday and went to Whitefish it wouldn't look good. He's probably kicking the teleprompter that made him say that these guys need to work through the weekend because now he has to as well.
Now, Kristol said he doesn't know anything specific. He's just basing this on what Republican leaders have said publicly, which, I have to admit, I've missed. "Kristol forecast that defense spending cuts, tax increases and other cuts would be dressed up to be more than they really are in the end. And that would lead to a conservative revolt against Republicans. 'So great, we have a Republican House, and they are going to agree to the huge defense cuts, tax increases, phony spending cuts and increased debt,' Kristol said. 'I think there will be a huge rebellion among conservatives in the country if Republicans sign on to this deal.'" Well, that triggered my own search for news stories, and I was able to find 'em. They were all over the place, Washington Post, Politico, they were all there. Now, my antenna went up and I said, "Okay, some red flags here," and there could be a little reverse psychology being employed by Kristol, you never know. I hadn't gotten a wind of this myself.
Now, this morning, Boehner "said that no budget agreement with Democrats is 'imminent,' and he didn't see differences between the two parties narrowing in recent days," which is the opposite of what Obama is saying. He said, Boehner did, there's no deal between him and the president in public or private. His remarks came "as congressional leaders and President Barack Obama plan to work this weekend to reach a compromise agreement that includes as much as $4 trillion in deficit reductions over the next decade and an increase of the U.S. debt ceiling." I just want to fill you in on all the things that I subsequently learned after this. I just want to tell you with extreme confidence that if any of this happens, if there is a cave by House Republicans on this debt limit, if Obama gets what he wants, all of what he wants as Kristol is alluding to here and was backed up by other reports, then you can say good-bye to the Republican National Committee. It will implode. People will stop sending it money. You can say hello to an Obama second term because there will be a third party. The Tea Party will organize as a third party.
If there is a cave on this we could lower the debt ceiling and make our debt payments, as I detailed yesterday. We are not at risk of default. We are not in danger of default. Anybody, either party who says we are is engaging in demagoguery and the same classic Washington tactic of creating for you a crisis, an apocalyptic crisis that has to be solved now or else. I'm telling you, that isn't true. Just as the world was going to end if we didn't get TARP, that wasn't true. None of the forecast crises and their accompanying apocalypse have been true. Nothing that they have tried to scare us with since 2008 has been true. So if this cave happens, hello third party, it's going to happen, and then you're gonna see a wave of new presidential candidates get in the race, and Rick Perry will decide at that moment, it's time to get in, and Paul Ryan, who knows.
I don't mean to be alarmist here, but if these guys cave, the November elections of 2010 -- see, the thing to me is that Boehner isn't under any pressure. His base does not want to compromise. We do not want a compromise. Whatever pressure Boehner thinks he's under is coming from somebody else, 'cause it's not coming from us. We don't want him to cave. We want what's right. If they come out of there with no deal that's advantageous for us and is not representative at all of the November 2010 elections, I'm afraid to predict what's gonna happen to these incumbent Republicans. Rasmussen today, 72% of the country favor free market economy over one managed by the government. Seventy-two percent, in other words, want to fire Obama. Seventy-two percent want to fire every Democrat in Congress. Seventy-two percent of the people want their country back. This is why Democrats hate the Tea Party, and this is why the Republicans have to hold firm.
The Politico yesterday had this little passage, second paragraph: "Debt Talks, Bottom Lines Loom -- With White House debt talks due to resume Sunday, the next few days will sorely test the mettle of President Barack Obama and Speaker John Boehner as they try to finalize a landmark budget and tax reform deal, held prisoner thus far by the rhetoric of both parties." Sorry, Politico, there's no rhetoric that is holding anything prisoner here. It's hard, cold reality, and it's called saving the nation. Here's the second paragraph: "Boehner's forces appeared shaken Thursday by the skepticism they encountered for even entertaining new tax revenues as part of the package. And the GOP's divisions broke into the open at a White House meeting hosted by Obama for congressional leaders." I read that and I said, "Whoa." Boehner's forces appeared shaken Thursday by the skepticism they encountered for even entertaining new tax revenues.
Now, who are Boehner's forces? Who's this talking about? And then I learned what the rest of this means is, the Republicans' divisions broke into the open in a White House meeting. This means that other elements of the Republican leadership at the meeting with Boehner openly broke with him in front of Obama, while Obama was still in the room, other Republicans -- that's what this report says. Now, it's Politico, folks, sad to say we don't know how much of this is true because Boehner's out there saying there is no deal imminent; I don't know what this is all about, but we haven't moved close. I hope that's true. Hope this other stuff is BS. I hope Kristol's got it all wrong. But Boehner isn't under any pressure. What pressure could there be to cave to Obama? What's the pressure? It isn't coming from the American people. The American people don't want Obama's deal here.
RUSH: This is Bill Kristol of the Weekly Standard last night, Special Report with Bret Baier during the All-Star Panel.
KRISTOL: It sounds as if it's heading towards a deal. It's not a deal that I'm going to like I suspect and I think it's going to be a bad deal for conservatives and Republicans, but I think they are intimidated. The president's been running around talking about corporate jets and the rich, and how the sky's gonna fall unless Republicans cave, and I think they're getting ready to cave in a pretty big way on some things.
RUSH: That's what he said. Now, again, the media is all hoping that that this true and the things the media was writing last night independent, by the way, of anything Kristol said, the media was writing gave indications that there's something to this. For example, again this Politico story, "Boehner's forces appeared shaken Thursday by the skepticism they encountered for even entertaining new tax revenues as part of the package. And the Republican divisions broke into the open at a White House meeting hosted by Obama for congressional leaders," at the big meeting. Now, let's just take this at its word. It's the Politico, but let's take it at its word. They're in the meeting, there's a bunch of Republicans in the leadership there, of course, with Speaker Boehner.
At some point in the meeting Boehner signals willingness to entertain the idea of new tax revenues as part of the package, and at that moment elements within the Republicans that were with him revolted, and Boehner was shocked. Politico said Boehner's forces appeared shaken by the skepticism. How can you be so tone deaf? I read this, and I said, "Boehner cannot be this tone deaf. He cannot possibly think that a winning thing for him or the Republicans is to go along with tax increases." This just doesn't compute. He's not under any pressure from the base, anyway. We don't want to compromise with Obama here. We want Obama caving, which can be made to happen.
RUSH: Now, again, "Boehner's forces appeared shaken." See, I can't get beyond the hard, cold reality that I can't fathom what pressure Boehner's under. Now, the traditional way that Republicans get snookered here is to be made to believe that the American people are clamoring for whatever it is the Democrats want. I don't care, Obama, Barney Frank, I don't care, that's always the template, whatever Democrats want, the people want. And that the Republicans are the obstructionists and that they're standing in the way and they're not working with anybody and they're racists sexists bigots homophobes and they're mean-spirited extremists and now they're Wahhabis holding guns to people's heads and all this sort of stuff.
So that would add up to me to be media pressure, and we know that in Washington media pressure is intense. We know that, sadly, more often than not, Republicans react to it. But there certainly is no pressure on the Republicans from their voters to do this. I mean to give Obama what he wants here, more spending, to give him a lifeline to the 2012 campaign and reelection? That's what our base wants? I mean, forget for a moment, even if you want to take it to the detail that, well, maybe Boehner's not a movement conservative, okay, fine. Maybe Boehner's not a movement conservative; he's not a liberal Democrat. And again, I have to remind you here that Boehner has said, it's been reported all over the place, he had a press conference, "Look, I don't care what you're hearing, no deal is imminent here. We're not close, either in public or private."
He didn't specifically address any of the claims that have been made in some of these news stories. For example, where is it, TheHill.com is reporting that they discussed cutting the military yesterday from between 600 to $700 billion. Now, Obama, his original proposal was to cut defense $400 billion. There's TheHill.com reporting that they were discussing cuts in the range of 600 to $700 billion. Now, the fear, the fear here is that nondefense cuts will be weak, as they always are, and they'll be spread out, they always are, the cuts in defense much heavier than we should have, and that something smells on the revenue side, why we even talking about revenue, this ought to be all spending they're talking about. But apparently they're not talking about serious course reversal, no serious steps to fend off what's coming.
Nobody's is reporting that the Republicans in the meeting are telling the president no more spending. Okay, all right, Republicans are creatures of Washington. What does Washington do? It spends money. It's what it thinks it has to do. That's what the role of government is, spend money, that's how you please people, it's how you pay people off, it's how you buy their vote, whatever. Those days are gone now; we don't have the money. We're under the impression that the people we elected in November know it. And we're under the impression that the people we elected in November are there to put the brakes on and to represent those who elected them in a huge landslide, always remembering that that November election result was an anti-Obama vote. It wasn't so much a pro-Republican vote; there wasn't a Republican message per se.
There wasn't a Republican personality or identity people could latch onto in that election. They were talking House and Senate races, down-ballot state legislatures. It was a slam-dunk. It was an overwhelming landslide and it was resulting from the Democrats, Reagan Democrats and independents fleeing Obama. That was an anti-Obama, anti-liberal, anti-Obama policy vote in November. Those people haven't changed their minds. Unemployment news today, you've heard it, 9.2%. The president with a pathetic announcement about it today. CNBC and some other business channel experts were all predicting a rosy economy by now. They're eating crow left and right.
You've got David Plouffe -- did you see this? Obama's campaign ace in 2008 said, (paraphrasing) "You know what, unemployment's not even gonna be an issue in 2012. Is not even gonna be an issue." You know why unemployment's not gonna be an issue in 2012, folks, you know why? Essentially he said because voters are stupid, they don't care about anybody but themselves. He said the voters are going to be voting on their own circumstances, and if their future looks good they're not gonna want to change anything, they're not gonna want to change horses in the middle of the stream. Fine. That's a crazy thing to say. Who in the world, in a majority, does that include? When I see a poll 72% want a free market economy, not government-run, when 60-plus percent say they don't like the direction the country is going, where in the world does anybody get from that that Obama wins reelection because people are comfortable and happy with their own personal circumstance? Oh, yeah, the unemployment rate doesn't matter. Of course you say that now that they've figured they're not gonna be able to get it below 8%.
In fact, the Bureau of Labor Statistics played another little game starting this year in order to keep that number at 9.2%. Not only are they monkeying around with the total number of jobs in the universe and reducing it, they are now expanding from two years to five years a statistic regarding the number of people unemployed. I will explain that to you in detail as the program unfolds. Also, there's a panicked press release today from some commercial real estate people, trade people, that in the discussion yesterday, Obama -- and, by the way, he has made this is official in 2009 budget documents he's presented that he wants to get rid of the carried interest tax break for hedge funds, private equity groups, and commercial real estate people.
Now, carried interest, I gave myself a challenge today, make the complex understandable. What is it? Gave myself a challenge, be able to explain carried interest inside of a minute. I think I've been able to do it. But essentially carried interest is profits for original investors in hedge funds, private equity firms, commercial real estate that is at present taxed at capital gains levels, and they want to convert this to ordinary income, which would move it up to about 35 and then eventually 39.6 if Obama gets his tax increase wish, which would shut down commercial real estate investment. It would just end it. So basically in less than a minute I told you what it was. So apparently these people in the commercial real estate industry are panicked that the Republicans are gonna cave on that. I got that this morning in the e-mail.
Then you got the corporate jet guys, they're panicked over what's planned there. So something is clearly going on. If you look at what Obama has achieved, his stimulus is now part of the baseline of every single budget. He wants to slash defense, bye-bye NASA as of today. There's talk about revenue being generated, and the Republicans are engaging in those talks, when revenue shouldn't even be an issue. Obamacare is not being discussed, and that's the biggest spending problem to come down the pike, that's got to be defunded or repealed, and that's not even being discussed. And Obama's talking about spreading out budget cuts over more than a decade, meaning they will never occur. So you, as a Congress, you agree to budget cuts today that will happen in 2010. Well, by the time the Congress of 2020 comes along they're gonna say screw those guys in 2011, we're gonna do what we want to do now.
So all these long-term, out-year cuts, they're never gonna happen. It's as old as the Democrat Party the playbook. I don't know why the Republicans feel any pressure to do this. What am I missing, folks? What am I missing? Where is the pressure? I know there's media pressure on the Republicans. What, Snerdley, what? Okay. So the pressure is that we have to expand the debt ceiling, 'cause it's the responsible thing. If we don't raise the debt ceiling, we default. That's the pressure. Okay, all right, so who's saying that? The media is saying that and Obama's saying that. All right. Well, I know Boehner is saying it. In fact there's a Politico story here, I'll find it, I've got stuff scattered over different places here, but Boehner has said we gotta do this by August 2nd, and we don't. We don't. We could lower the debt ceiling and still service the debt. But I don't know how much of this is gamesmanship and Obama being pressured by Boehner in a little reverse game here.
Regardless, apparently the Republicans are feeling pressure from someplace but from the wrong place. They're reacting to the wrong pressure and they're reacting to the wrong people. Obama does the same thing every time, the same thing every time. I've figured out it out. This is what happens. In order to keep the public in the dark about what he's doing and to bypass the usual legislative process, Obama waits until the last minute for everything. He doesn't get involved in talks until the final moments, then when he does get involved, the meetings are in secret. He comes out of the meetings framing the issues and some deal gets cut, and the public really has no idea what the details are until there is a vote.
This is how he operates. This is how he undermines the legislative process, by the way. This is how he controls the media spin. This is how he deceives the public. This is how he leads from behind, and he only gets away with it because the Republican leadership is somehow caught constantly off guard and lets it happen knowing full well that it's coming. Now, on the other side the Democrats are fit to be tied, too. Pelosi, when she heard that Social Security and Medicare cuts are part of what Obama's offering, she's flipping her wig, and so's David "Rodham" Gergen. We've got sound bites of that to share with you. This is why I am here, my friends, to cut through all of this drivel, all of this bilge to get to the essence of what's being discussed and what's taking place.
RUSH: There's another element at play here, of course, and that's big money, who could Boehner and the Republicans be feeling pressure from. McConnell, could be Wall Street types, could be big money types who want, you know, for their world to function, have the debt ceiling raised, no worries about credit ratings and bond ratings and all that and could very well be that that's where the pressure Boehner is feeling is coming from.
RUSH: By the way, Byron York via Twitter: "John Boehner's office responds to Bill Kristol's prediction the Republicans will cave on the budget talks, Boehner's spokesman said, 'Well, that's clear as crystal. No tax hikes.'" Further from the DC Examiner: "Boehner: No, GOP Won't 'Cave' in Budget Talks -- House Speaker John Boehner's office is pushing back against speculation that Republican negotiators will 'cave' to President Obama in talks on raising the national debt ceiling. 'Every Republican has been clear as crystal: No tax hikes,' says a Boehner spokesman. 'Tax hikes destroy jobs and they cannot, and will not, pass the House.'" That clear as crystal, they're spelling that c-r-y-s-t-a-l. That formulation, I mean that's no accident. Kristol spells his name K-r-i-s-t-o-l. That's clear as crystal. So Boehner's office is pushing back.
Folks, that 44,000, this Reuters number, Labor Department said that the economy created 44,000 fewer jobs in April and May than previously thought. That means they cut the numbers by half. Forty-four thousand means they cut the numbers by half. The May number alone was revised down by 25,000. That cut the number of jobs added in May in half. That means that this number today that we created 18,000 jobs, that's not true. That's going to be revised. They're just now telling us how bad they missed it in April and May. The thing is, I don't have to tell you. You know this. Everyone's living this. Everybody is living it.