Senate blocks Republican bill as debt crisis deadline looms

The current crisis threatens to derail the global economy, as well as Barack Obama's presidency.

The US debt crisis shows no signs of resolution as Tuesday's deadline to raise the debt ceiling draws closer.

Late last night, the Republican-controlled House of Representatives finally approved a bill to raise the debt ceiling in return for $22bn spending cuts. It was immediately rejected by the Democratic-controlled Senate.

The frenzied series of votes has highlighted not only the profound partisan division between Democrats and Republicans; it has also laid bare the deepening rift within the Republican party. On Thursday, the Republican leader in the House, John Boehner, was forced to abandon a vote on his bill to avoid a humiliating defeat by hardline Tea Party conservatives.

While this chaos in the Republican ranks temporarily looked like it could strengthen Barack Obama's position, as the Tuesday deadline looms, the situation does not look good for anyone. We can expect the fast-paced political manoeuvres to continue as each party tries to make their plan more acceptable to the other side, while also keeping their own hardliners on side.

Obama, who entered the debt ceiling debate calling for a "clean" increase with no spending cuts attached, has made significant concessions, accepting deep cuts to state-run health and pension schemes.

This is a crisis that threatens the entire global economy. The International Monetary Fund has already warned the US that a continued impasse risks reigniting Europe's debt crisis. Even if a bill is rushed through, it is possible that we have not seen the last of it.

It is also a crisis that threatens to derail Obama's presidency. The Democratic Senate leader, Harry Reid, has promised a vote on a new deficit-reduction proposal which will incorporate parts of a "back up plan" initially proposed by Mitch McConnell, a Republican Senator. "Unless there is a compromise or [Republicans] accept my bill we're headed for economic disaster," said Reid, who is seeking a vote on this proposal today. According to the Huffington Post, some centrist Republicans may be willing to back the bill.

The two proposals have much in common, the crucial difference being that in the Democratic Senate version, Obama would be given the $2.5 trillion debt increase in one step, rather than the three steps suggested by the Republican bill. This would prevent a hugely damaging second debt crisis during an election year. Democrats are worried with good reason -- a recent Pew poll contains worrying results for Obama.

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Disastrous growth figures -- the US grew at an annual rate of just 1.3 per cent in the three months to June -- will do nothing to help. Obama needs nothing short of a miracle on the economy, and this crisis has laid bare the extent to which he is held hostage by the Republican control of the House. If the GOP selects a plausible candidate for 2012, the president will have a very serious fight on his hands.

Samira Shackle is a freelance journalist, who tweets @samirashackle. She was formerly a staff writer for the New Statesman.

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Donald Trump is the Republican nominee. What now?

So a Clinton-Trump general election is assured – a historically unpopular match-up based on their current favourability ratings.

That’s it. Ted Cruz bowed out of the Republican presidential race last night, effectively handing the nomination to Donald Trump. “From the beginning I’ve said that I would continue on as long as there was a viable path to victory,” Cruz said. “Tonight, I’m sorry to say it appears that path has been foreclosed.”

What foreclosed his path was his sizeable loss to Trump in Indiana. Cruz had bet it all on the Hoosier State, hoping to repeat his previous Midwest victories in Iowa and Wisconsin. He formed a pact with John Kasich, whereby Kasich left the anti-Trump field clear for Cruz in Indiana in return for Cruz not campaigning in Oregon and New Mexico. He announced Carly Fiorina as his vice-presidential nominee last week, hoping the news would give him a late boost.

It didn’t work. Donald Trump won Indiana handily, with 53 per cent of the vote to Cruz’s 37 per cent. Trump won all of the state’s nine congressional districts, and so collected all 57 of the convention delegates on offer. He now has 1,014 delegates bound to him on the convention’s first ballot, plus 34 unbound delegates who’ve said they’ll vote for him (according to Daniel Nichanian’s count).

That leaves Trump needing just 189 more to hit the 1,237 required for the nomination – a number he was very likely to hit in the remaining contests before Cruz dropped out (it’s just 42 per cent of the 445 available), and that he is now certain to achieve. No need to woo more unbound delegates. No contested convention. No scrambling for votes on the second ballot. 

Though Bernie Sanders narrowly won the Democratic primary in Indiana, he’s still 286 pledged delegates short of Hillary Clinton. He isn’t going to win the 65 per cent of remaining delegates he’d need to catch up. Clinton now needs just 183 more delegates to reach the required 2,383. Like Trump, she is certain to reach that target on 7 June when a number of states vote, including the largest: California.

So a Clinton-Trump general election is assured – a historically unpopular match-up based on their current favourability ratings. But while Clinton is viewed favourably by 42 per cent of voters and unfavourably by 55%, Trump is viewed favourably by just 35 per cent and unfavourably by a whopping 61 per cent. In head-to-head polling (which isn’t particularly predictive this far from election day), Clinton leads with 47 per cent to Trump’s 40 per cent. Betting markets make Clinton the heavy favourite, with a 70 per cent chance of winning the presidency in November.

Still, a few questions that remain as we head into the final primaries and towards the party conventions in July: how many Republican officeholders will reluctantly endorse Trump, how many will actively distance themselves from him, and how many will try to remain silent? Will a conservative run as an independent candidate against Trump in the general election? Can Trump really “do presidential” for the next six months, as he boasted recently, and improve on his deep unpopularity?

And on the Democratic side: will Sanders concede gracefully and offer as full-throated an endorsement of Clinton as she did of Barack Obama eight years ago? It was on 7 June 2008 that she told her supporters: “The way to continue our fight now, to accomplish the goals for which we stand is to take our energy, our passion, our strength, and do all we can to help elect Barack Obama, the next president of the United States.” Will we hear something similar from Sanders next month? 

Jonathan Jones writes for the New Statesman on American politics.