Cantor pulls out of debt talks

We talked earlier about how badly the bipartisan debt-reduction talks appear to be going. The Wall Street Journal reports this morning that the process appears to be getting worse.

House Majority Leader Eric Cantor Thursday said he was pulling out of the bipartisan budget talks headed by Vice President Joe Biden for now because the group has reached an impasse over taxes that only President Barack Obama and Speaker John Boehner (R., Ohio) could resolve.

Mr. Cantor, in an interview after a negotiating session he described as bitterly contentious, said he would not be attending today’s scheduled meeting of the bipartisan deficit-reduction leadership group because he believed it was time for the negotiations to move to a higher level.

“We’ve reached the point where the dynamic needs to change,” Mr. Cantor said. “It is up to the president to come in and talk to the speaker. We’ve reached the end of this phase. Now is the time for these talks to go into abeyance.”

Let’s put this another way. One of the leading hostage-takers (Cantor) has decided he no longer wants to talk to the negotiators (Democrats) struggling to meet his unreasonable demands. Instead, he wants the lead hostage-taker (Boehner) to talk to the lead negotiator (President Obama).

This was expected to happen eventually, but only after these participants crafted a blueprint, or at least an outline, for a compromise. Cantor, this morning, indicated that the current participants can’t even get to this point.

For two weeks, the oft-confused House Majority Leader had said the talks appeared to be progressing nicely. It now appears Cantor either didn’t mean what he was saying, or the process collapsed with surprising speed.

Keep two additional angles in mind. First, the clock is quickly becoming an enemy here. In order to avoid a panic and risking the nation’s credit status, everyone seems to agree a deal should be wrapped up before the 4th of July. That is, for those keeping score at home, 11 days from today. With progress at a standstill, what are the chances leading policymakers will resolve their differences over the next week?

Second, to reemphasize a point from earlier, failure on this isn’t like failure in most legislative talks. On most issues, if policymakers engage in negotiations, and the process fails, the bill dies and goes away for a while.

When it comes to the debt ceiling, if the talks fail, Republicans have vowed to cause a recession on purpose. If failure is an option, the consequences would likely prove catastrophic.