Strategic analysis of the Budget Control Act

1 August 2011 by Keith Hennessey 1 Comment

hundreds-stack

This is the third of three posts on the Budget Control Act.

The other two posts are:

I cover three topics in this post: what important players won in this deal, the core concepts and tradeoffs within the deal, and what the different strategies might be this Fall under this bill if (when?) it becomes law.

The President’s priorities

The President knows he will get debt limit increases through early 2013 no matter what House conservatives/Tea Party members do. Those Members can no longer “hold a debt limit increase hostage” before the 2012 election.

We could also describe this as eliminating liquidity risk through 2012. Continue reading “Strategic analysis of the Budget Control Act”

Understanding the Budget Control Act

This is the second of three posts on the bill agreed to by the President and the bipartisan bicameral leaders of Congress (Speaker Boehner and Leaders Reid, McConnell, and Pelosi).

The other two posts are:

If you have not read my quick summary post, please do so before reading this one. I cover three topics in this post: how taxes are treated in the Joint Committee, how the spending cut trigger works, and the intentional imbalance of triggered spending cuts. All three are critical to the strategic analysis. Continue reading