The Wednesday deal that reopened the government and raised the debt ceiling drew furious condemnation from FreedomWorks, the national Tea Party group which spun off from the Koch-founded Citizens for a Sound Economy (and until last year was chaired by Dick Armey).
In a Thursday afternoon interview, Executive Vice President Adam Brandon told Salon he thinks the risk of debt default was overblown, he believes Obama would have delayed the individual mandate if Republicans had hung together, and he suspects Speaker Boehner may have been scheming all along to embarrass conservatives. A condensed version of our conversation follows.
Was there a winner is this showdown?
I don’t think there was a winner anywhere. All that happened was kick the can down the road. And the American people kind of looks at this as a pox on everyone’s houses. That’s just kind of where we are.
The strategy Republicans took in the lead-up to the shutdown, around the CR and debt ceiling - was that the right strategy?
I think it was the right strategy. Because there really wasn’t that many other options.
…Whenever I walk past the TV I see Lindsey Graham and John Cornyn and others shooting at - John McCain shooting at Ted Cruz and Mike Lee for their plan. Where was their plan?... There wasn’t another alternative Republican plan…
These members went home for the August recess. A lot of them…their constituencies want to stop Obamacare and reduce the debt and deficit. They heard from them. Very very loudly…
You hear about bipartisanship and all of that, but you’re also seeing that’s there’s factions …within the GOP. And that’s kind of coming out to the forefront.
So who’s to blame for the way that this ended?
Well I think basically everyone…
The House has passed bills…Barack Obama and Harry Reid are basically saying, “That’s nice that you’ve passed pieces of legislation - now go pound salt until you do exactly what we want.” And I don’t think [there] was every any serious efforts to actually fix the problems with Obamacare.
In the press reports Wednesday night, there was some praise for Speaker Boehner from some of the more conservative members of the House. What’s your reaction to that?
I’m not sure if he’s going to be running for Speaker again. I wonder if that’s part of all of this as well. Why did - I mean the way it was crafted…You needed Democrats to pass this. And what I don’t understand is, if the plan all along was to put just basically a pretty clean CR out there and pass it with Democratic support, Democratic members, why even do it? Why not do this a month ago? Or were they actually trying to embarrass some people, or trying to cause this fight? I mean who knows. I don’t know why these things - if this was the plan all along, he should have started this at the very beginning, and just, “Hey, listen, we’re just going to pass this with Democratic votes.”
When you say “trying to embarrass some people,” which people are you talking about?
The fiscal conservative caucus. Now those folks, like they’re the ones who’ve heard from their base. And I see there’s such a long-term play going on here.
Now where I see that, a lot of the old institutions in Washington are crumbling, and there’s new power centers and institutions. It used to be when you got elected, you got elected because you spent the most money on television ads…A lot of these guys who got elected, like a Ted Cruz, like a Mike Lee, not only were they not helped by Washington, but for the most part, Washington was supporting their opponent. So this new group…they are not beholden to K Street and the leadership and the old centers of power. So there’s kind of a fundamental realignment going on within the Republican Party, and within politics in general.
I think that the Republican Party is also struggling with the fact that for the first time in its history, they actually have this massive committed ground game…The problem for them is this ground game is so wedded to principle and actually shrinking the size and scope of government that, lo and behold: These new members are actually -they’re more connected with that group, not the K Street club group. And so they’re actually going to do what they said…which is absolutely everything they can do to try to stop Obamacare and shrink the size and scope of government.
It’s ironic that you have problems in Washington today because you have candidates who are keeping their campaign promises.
So are you suggesting that the Speaker may have gone along with the shutdown in hopes that it would weaken the reputation of the Tea Party?
Maybe. I don’t have any proof to that. But what I don’t understand is, if your goal- all along you were planning to pass this with a Democrat vote, why did you go through all this? Why not just throw it out there to begin with a few weeks ago? A few months ago?
Are you surprised by the way Boehner handled this situation?
Not particularly, no. Look: from the very beginning of this, if you go back to summer, all you find is quotes from Boehner, quotes from McConnell: “We do not want to shut the government. We’re gonna to do everything we can to not shut the government down.” They already outlined their terms of surrender before getting to the ballot. If the GOP would have had a more unified front…You probably could have really gotten some good negotiations and perhaps have delayed the individual mandate.
What would that have looked like? How would that have happened?
Well, you go in – obviously, the Republicans, the Mike Lees, Ted Cruzes, they were fighting for full defund. No doubt about it, that’s their- you know, their first shot going into negotiations…If you have a unified party heading into it, as the Democrats were unified, then at that point you actually do have to have a real negotiation. Too often Republicans are just negotiating with themselves in all of this. The hard line that I saw was- Harry Reid and President Obama were the ones that were taking the real hard line. And when you go into that hard line like Speaker Boehner, saying “we absolutely do not want to shut the government down” – well, you know, you already know that he’s outlined the terms already.
So what do you think Obama would have conceded if the Republicans had been on the same page?
I bet if they would have come to him [with a] pretty strong, unified stance, he would have given on the – he was – it was pretty unfair and rhetorically hard to defend that you give business a one-year delay but you don’t give individuals a one-year delay. I bet you he would have given in on that, given on that. And that would’ve been good for everyone.
So once we reached the point that we were at Wednesday night, if the Republicans in the House or in the Senate had voted down the deal - what do you think would’ve happened at that point?
I have no idea. I really do not have any idea. I know that this debt, this fiscal cliff ceiling number, I mean it’s been moving all summer. I read earlier today how economists said the actual day they’d run out of money is October 22, not October 17. So I don’t I think anyone really has a clue of what the actual date would be. I mean, I still think the sun would have come up and people would’ve gone to work the next day.
And I’ve got a real problem with this wait to the last minute anyway. This is exactly how TARP would have passed...This is what happens when you have the establishment in both parties kind of conspiring to force this stuff on people. I wish we would start working today on fixing some of these long-term problems so we don’t have to have another damn CR and all of that come January. My guess is right after Christmas, we’re going to start talking about it, and then come January 15, 14, it’s going to get really serious and, “Everything[‘s] going to fall apart if we don’t do x y or z.” I mean I wouldn’t be so surprised if the government shuts down again in January and then we have the same…
The debt ceiling rules have been changed now again…My understanding, it would actually take an active vote to not raise the debt ceiling so I guess. Score one for the Federal Reserve and all that.
So if Thursday had come and gone and the debt ceiling hadn’t been raised, do you think that would have been bad for the economy?
Well, uncertainty is bad for the economy, there’s no doubt about it. This system was not designed for the United States not to do this. That is a problem. I don’t think anyone fully understands what would really happen there.
When people said the sequester was going to happen, the sky was going to fall - the sky didn’t fall. I think you could go back to the TARP fight and try to figure out well, what really would have happened? I figure there are several other options the United States had than just bailing out banks. You know, who knows?
I mean it’s problematic. It’s hard when you can’t issue debt in the system that we have, so in the short term it’s problematic. But my fear is in the long run…eventually we’re getting to the point where the United States is not going to be able to pay this debt. So it’s just going to inflate the currency. And how is that good for investors? How is that good for the world economy if you keep debasing the value of your currency?
Because right now I don’t know how - I don’t know of any other way that you get out of this besides that. What happens – here’s the big crisis that’s coming – what happens when interest rates just return to historical averages?…If you think the sequester was big, imagine when we have to come up with another two, three, four, 500 billion dollars a year just to pay the interest on our existing debt.
The projection that was put out by the Treasury Department that said that there was a risk of economic impact worse than what happened in the 2008 crash - do you find that credible?
It – see what I don’t find credible in that argument is, if the United States stops paying its interests on its debts, then the financial system kind of collapses around the world, so yes that would be - but I then kind of reject that argument, based on the fact that the numbers that I have seen is…between 80 and 82 per cent of the necessary funds to fund the government would still be coming in.
So you gotta prioritize…So the first things that I would pay, I’d pay for military, I’d pay for debt service, I’d pay for Social Security. And what are the last thing I would pay? Subsidies for agri-biz and all this. And there is just no will in Washington to prioritize…Why would the Treasury not say, look, pay up world investors, and while we’re sorting this mess out guaranteed…we’re paying our coupon. Don’t worry about it.
How do you think that would have affected the U.S. economy?
It would have an effect. Would it be catastrophic? Would we be beating each other for meat in the street? Would criminals be roaming after the prisons open up? No. And I assume that they’d probably get their house in order pretty quickly in that type of situation. But it’s, I think it’s far from catastrophic...
But I think that the reason we see that stuff is because the design was, you put the people in front of a loaded gun and say, “if you don’t vote for this bill, you’re going to blow up the universe.” …That’s to get people to actually go along with something they don’t want to.
Who should be the Speaker of the House?
What I would love to see some day would be Republicans, this freedom caucus emerging - with these Thomas Massies and David Schweikerts and Justin Amashes - you know, get large enough so one of those names could eventually get in there. You know, right now we’re still, I think, the freedom caucus …30 or 40 members. But we’re going to need to pretty much double that eventually to really get the impact you’d want to have.
Should Boehner resign at this point?
That’s up to the conference…Harry Reid is more of a driver of this situation than Boehner…I’m not really sure.
On TV last night, Congressman Jack Kingston defended the shutdown by saying “it was important for us to reestablish our brand as being against Obamacare.” What do you make of that?
I think we’re pretty clear now…I think there’s some truth to that…I love these polls that come out there and they show that the Americans oppose the shutdown. And then the next question is, “Do you think candidates should keep their campaign promises and stand on principle?” Well yeah…
The long-run problems, those problems haven’t changed. They’re just becoming manifest…Over the next year, when people do start losing the insurance, they lose that commitment that they have that they can keep the insurance if they like it, and we start seeing these unintended consequences, people will be pretty pissed…
The main problem with Obamacare is it focused in on access, it didn’t focus in on cutting costs.
Cutting Social Security benefits and/or Medicare benefits – how much support for that do you think there is among the people who identify as Tea Party members?
Well, I think it’s a lot more fun to spend money than to cut the budget, there is no doubt about it. But I think everyone knows - I mean, we all know that the entitlement programs are the big drivers in our budget. Cutting foreign aid is going to do nothing for our fiscal situation. So people do – when I talk to folks, people understand we have to transition. When we talk to our activists about plans that allow younger voters, like under age 30, to start opting out in different plans...You hear about [what] Chile, did but Australia’s got- had a pretty fantastic program as well. And you slowly start to transfer over the next couple generations from this Ponzi scheme-built system to a more controlled, personal account-type system -that’s something I’d like to see come back. That to me is probably the best system I could think of…
Medicare is going to be a little bit harder. It’s a lot more fun to spend money than it is to have the politics of trying to get back on budget.
The next round of the fight over the budget – how, if in any way, should Republicans approach it differently?
I don’t know right now if the next round of the budget is going to focus in on defund. I don’t know if the next round of the budget is going to focus on delay. I don’t even know if the next round of the budget debate is even going to hit on Obamacare. I assume it will. But I think everyone is going to want to let the dust settle for a few days and see where everyone stands. I know we’ve gotten overwhelming calls today. The general feeling is anger and disappointment and then, “what do we do next?”
And what’s the answer to the “what do we do next” question?
I think what you’re going to start to see: Gravity is going to start pulling automatically into the 2014 electoral cycle. I think you’re going to start seeing a lot more news on primary challengers, particularly places like Texas, Mississippi, Tennessee, Kentucky, South Carolina. Some of those states are going to get strong challengers. Some of those states are going to get no challengers. But in that mix, probanly an incumbent or two is going to go down this cycle. And it’s all going to be because of this.
Particular incumbents you want to point to?
I find out about endorsements the same time that you do…I do know that we have certain criteria, and all of those states I just mentioned would be potential primary opportunities …
I see that John Cornyn ended up voting with the eightteen against the bill – which, I could laugh out loud when I saw that. This is a guy who obviously has been feeling the pressure. He doesn’t even have an opponent and he’s worried…Voting records are a bitch when you head into primaries. So here you go - I think people are going to be emboldened …I think in the next six to eight weeks you’re going to start hearing about more challengers.
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