House Republicans last year used the imminent approach of the nation’s credit limit to force Congress into enacting a series of spending cuts. The hostage scenario led to the nation’s first ever credit downgrade, with the credit rating agency Standard & Poor’s repeatedly citing the GOP’s intransigence on revenue as a key justification.

Speaker of the House John Boehner (R-OH) has indicated that the GOP is ready to reenact the debt ceiling debacle the next time the nation comes close to its borrowing limit. But as economists Betsey Stevenson and Justin Wolfers write, the economy was significantly setback during the last showdown, which they call “an act of economic sabotage“:

High-frequency data on consumer confidence from the research company Gallup, based on surveys of 500 Americans daily, provide a good picture of the debt-ceiling debate’s impact (see chart). Confidence began falling right around May 11, when Boehner first announced he would not support increasing the debt limit. It went into freefall as the political stalemate worsened through July. Over the entire episode, confidence declined more than it did following the collapse of Lehman Brothers Holdings Inc. in 2008. After July 31, when the deal to break the impasse was announced, consumer confidence stabilized and began a long, slow climb that brought it back to its starting point almost a year later. [...]

Growth in nonfarm payrolls decelerated to an average 88,000 a month during the three months of the debt-ceiling impasse, compared with an average of 176,000 in the first five months of 2011 (see chart). Payroll growth subsequently recovered and has averaged 187,000 jobs a month since. Despite the rebound in job growth, employment is likely still below where it would otherwise have been.

Despite numbers like this, House Republicans evidently desire to deal the still fragile economic recover another body blow.

Last August, debt ceiling negotiations between House Republicans and Senate Democrats came to an end when President Obama signed into law the Budget Control Act, a not-so-grand bargain that created a legislative super committee tasked with finding spending cuts to offset the debt ceiling increase. If the super committee failed, automatic cuts from the defense budget and discretionary spending levels would offset the cost.

The deal was an end to three tumultuous months of wrangling over the debt ceiling that brought the government to the brink of default and, thanks to the GOP’s intransigence on new tax revenues, led to the first credit downgrade in the nation’s history. House Republicans have repeatedly threatened to renege on the deal, and this morning, they made it official, adding an amendment to the National Defense Authorization Act that officially replaced spending cuts from the defense sequestration with cuts from the House reconciliation package.

In less than 10 minutes, the House officially unwound a budget deal that took an entire summer to craft, the New York Times’ Jonathan Weisman reports:

Without discussion, the House just voted to scrap the defense sequester, 220-201. 21 Republicans voted no. Oh well, there goes that.

— Jonathan Weisman (@jonathanweisman) May 18, 2012

After rendering last year’s negotiations completely pointless, House Republicans are poised to pull the exact same charade this year. Tuesday, the Washington Post reported that Speaker John Boehner (R-OH) “will insist that any increase in the debt limit be accompanied by spending ‘cuts and reforms greater than the debt limit increase,’” putting the economic recovery in jeopardy once again. Last year, the Economic Policy Institute estimated that the spending cuts Republicans required to raise the debt ceiling cost the economy 1.8 million jobs. And yet the GOP insists on recreating the same disastrous scenario all over again.

Last August, the nation narrowly avoided hitting its debt limit thanks to a last minute deal cut by Congress. House Republicans had threatened to push the country into a default unless Democrats agreed to spending cuts that were larger than the amount of the debt limit increase.

The episode is widely regarded as an embarrassment for good governance and a blow for the economy. Standard & Poor’s, even with the deal, downgraded America’s credit rating, citing the GOP’s complete intransigence regarding revenue increases. But it seems Speaker of the House John Boehner (R-OH) is ready to write the sequel, as he will reportedly demand today that the next increase in the debt limit follow the same GOP criteria:

In a speech Tuesday, House Speaker John A. Boehner (R-Ohio) plans to address the issue of national debt, which will once again be nearing its legal limit in January, just as the tax hikes and spending cuts are due to hit.

According to advance remarks provided to The Post, Boehner will insist that any increase in the debt limit be accompanied by spending “cuts and reforms greater than the debt limit increase” — the same demand that pushed the Treasury to the brink of default during last summer’s debt-limit standoff.

According to the Economic Policy Institute, the cuts demanded by the GOP in exchange for raising the debt limit will cost the economy 1.8 million jobs this year. Treasury Secretary Tim Geithner already pushed back on Boehner’s remarks, saying, “this commitment to meet the obligations of the nation, this commitment to protect the creditworthiness of the country, is a fundamental commitment that you can never call into question or violate.”

House Republicans made it clear earlier this year that they had no intention of upholding the debt deal reached in 2011, despite a vow from President Obama that he would veto any appropriations bills that attempted to cut more spending than was agreed upon last August and a pledge from Senate Minority Leader Mitch McConnell (R-KY) that the deal would be upheld in the Senate.

After earlier indications that they would make substantial cuts to domestic programs to preserve defense spending, the House Appropriations Committee made it official yesterday, setting a spending level $27 billion below the level agreed to in the debt deal. The committee, bowing to the GOP’s more conservative wing, will make deep cuts to food assistance, financial regulations, and a host of other programs, setting up the potential for a government shutdown when the fiscal year ends in October, Politico reports:

The House begins with a total of $1.028 trillion for discretionary spending, $19 billion below the $1.047 trillion target set last summer and $15 billion below what was enacted just months ago for the current 2012 fiscal year. Republicans would also go $8 billion over the caps set in the Budget Control Act for defense spending, and the result would be a net reduction of more than $27 billion from all other appropriations.

This translates into an added cut of about 5 percent, with the burden falling chiefly on a half-dozen domestic spending bills affecting nutrition programs, transportation, financial regulatory agencies, natural resources, and especially the labor, health and education bill cited by Dicks.

After GOP leadership worked with Democrats to form the debt deal last year, the party’s conservatives have seemingly wrangled control back from Speaker John Boehner (R-OH). House Appropriations Chair Hal Rogers (R-KY) opposed efforts to break the deal but went along at Boehner’s urging in attempts to assuage more conservative members — even still, four conservatives pushed Rogers to cut as much as $97 billion from the debt agreement.

Senate Republicans, despite McConnell’s stated position last week, are now making similar rumblings. South Dakota Sen. John Thune (R) said Wednesday that the Senate GOP may back House Republicans in setting lower spending limits, saying, “I think we’ve got to be as aggressive as we can in trying to rein in the cost of government, the growth of government.” With White House officials reiterating the president’s veto threat, however, 2012 is shaping up similarly to the summer of 2011, when Republicans repeatedly pushed the government to the brink of shutdown and nearly caused its default before striking a debt deal at the last minute.

House Republican leadership, under pressure from more conservative members of their caucus, last month reneged on the August debt deal and announced that they would cut more spending than was agreed to in the Budget Control Act that raised the debt ceiling. Senate Democrats were incensed, telling the GOP that its plan risked a government shutdown, and President Obama this week warned he wouldn’t sign any new appropriations bills until the House abandoned the lower spending levels.

In his first opportunity to weigh in on the battle, Senate Minority Leader Mitch McConnell (R-KY) yesterday sided with Obama and the Senate Democrats. Led by McConnell, all but two Republicans on the Senate Appropriations Committee voted to uphold the August debt deal, The Hill reports:

The committee met to divide up the $1.047 trillion allocated to discretionary spending under the debt deal — $19 billion more than allowed under the House-passed budget that Boehner supported. [...]

[McConnell] was joined by most of the Republicans on the committee and all Democrats in advancing the spending levels to be used to construct the 12 annual appropriations bills.

Sens. Ron Johnson (R-Wis.) and Jerry Moran (R-Kan.) voted against the allocations.

House Republicans have attempted to walk back other terms of the deal as well, refusing to include agreed-upon defense cuts in their budget. Instead, they’ve pushed even deeper cuts than were already required for food stamps, education assistance, and other programs, targeting those programs that help the poor and middle class for a majority of their spending reductions.

Even as he sided with Senate Democrats on current spending levels, McConnell attempted to salve House Republicans. According to The Hill, McConnell’s office noted that “has said the Budget Control Act numbers are just ceilings, not floors, and he would work to cut spending going forward.”

Last week, Speaker of the House John Boehner (R-OH) signaled during an interview with Fox Business that he was open to reneging on the budget deal the GOP crafted with Democrats last year during the debacle over raising the nation’s debt ceiling. Though the parties agreed in that deal on a spending level for the 2013 budget, Boehner is being pushed by the more conservative members of his party to cut even deeper.

And according to Reuters, that pressure has paid off, as both Boehner and House Majority Leader Eric Cantor (R-OH) are ready to cut below the level specified in the debt ceiling deal:

Republican leaders in the U.S. House of Representatives are ready to break a hard-fought budget deal with Democrats as they try to quell a revolt by conservatives who are insisting on deeper spending cuts ahead of the November elections.

House Republican aides said on Tuesday that House Speaker John Boehner and Majority Leader Eric Cantor were pressing for a modest $19 billion reduction of discretionary spending caps in this year’s Republican budget plan.

“I’m really disappointed that they’re considering a budget – violating the budget agreement that is now the law of this country. This was designed to avoid another government shutdown or a threat of a shutdown,” said Senate Majority Leader Harry Reid (D-NV). “We had a deal last August on the budget numbers, and we expect them to live with that deal,” Sen. Patty Murray (D-WA) has said. The end result of this standoff could be yet another impending government shutdown, as the government’s current spending authority expires on September 30.

Last August’s deal to raise the nation’s debt ceiling included a provision setting the level of federal spending for the fiscal 2013 budget. However, House Republicans have made a lot of noise about potentially presenting a 2013 budget that cuts even deeper. During an interview with Fox Business yesterday, Speaker of the House John Boehner (R-OH) appeared open to such a move, indicating the GOP leadership’s willingness to renege on the spending level agreed to last year:

We put limits on how much discretionary spending we can have last year and this coming year, and frankly for the next eight years. But those are limits, they’re ceilings. We can certainly do more.

Watch it:

“We had a deal last August on the budget numbers, and we expect them to live with that deal,” said Sen. Patty Murray (WA). As Maddow Blog’s Steve Benen noted, “the result of this is — you guessed it — a possible government shutdown in an election year.”

And this is just one more instance in which Boehner is being pulled along by the more conservative members of his caucus. This week, Boehner had to dump one of his top priorities — a transportation funding bill — when conservatives revolted. Boehner has now indicated he will bring up the Senate’s transportation bill, which he will presumably pass with the help of Democrats in the House.

Much of the spring and summer of 2011 was dominated by the showdown between President Obama and Congressional Republicans over whether and how the nation’s debt ceiling would be raised, with some Republicans vowing to oppose any increase in the nation’s borrowing limit and others even extolling the virtues of a national default on our obligations.

While the current statutory debt limit should be high enough to avoid another dramatic conflict until after the presidential election, the issue of the debt ceiling has now come up in the most unlikely of places: the GOP presidential primary.

With his own candidacy on the ropes, Mitt Romney is now attempting to use Rick Santorum’s past votes in favor of raising the debt ceiling in the hopes of slowing down Santorum’s surging campaign.  On no fewer than eight occasions since February 6, the Romney campaign blasted out press releases attacking Santorum for his debt ceiling votes.  The attack was leveled directly by Romney himself, his spokeswoman Andrea Saul, and two top surrogates, former Gov. Tim Pawlenty (R-MN) and Rep. Jason Chaffetz (R-UT).

Romney’s Super PAC, Restore Our Future, has also started carpet-bombing Michigan, Arizona, Ohio, Tennessee, Oklahoma, Alabama, and Mississippi with ads leveling the same attack:

It’s worth noting that last June, Romney signed a pledge sponsored by Sen. Jim DeMint (R-SC) that actually said the U.S. should not raise the debt ceiling and default on its obligations unless both houses of Congress passed a destructive balanced budget amendment and sent it to the states.  In the end, slightly less radical elements of the Republican party prevailed and the debt ceiling was raised upon pain of deep spending cuts (and with neither chamber having approved a constitutional balanced budget amendment).

Ironically, Romney’s own fiscal plan would necessitate large increases in the debt ceiling, in addition to those that will be necessary anyway in order to avoid defaulting on our current obligations. Despite its deep spending cuts (including to Medicare, Medicaid, and Social Security), his plan’s $6.6 trillion in tax cuts weighted toward the wealthy and corporations ensures that we’ll continue to run large deficits in perpetuity.

Until Republicans perfected the art of hostage-taking during the present Congress, raising the debt ceiling was a routine matter.  In fact, 130 Republicans currently in Congress voted to raise it at least one of the five times it was increased during the presidency of George W. Bush, including some who have endorsed Romney. Even the Weekly Standard’s Bill Kristol has questioned Romney’s “juvenile” debt ceiling attack on Santorum:

Santorum voted to raise the debt limit! (Along with every virtually other Republican when the GOP controlled the Senate-and does Romney think they shouldn’t have raised the debt limit?)

One is left to assume that Romney is either playing a cynical political game with this attack, or, based on his attacks on Santorum and the pledge he signed last year, take him at his word and conclude that he actually does oppose further increases in the debt ceiling barring the highly unlikely passage of a sure-to-be disastrous constitutional balanced budget amendment.