In a speech before a Wall Street crowd on Monday, John Boehner laid out the three legs of the GOP's opening bid on the debt ceiling. They are:

1) "Without significant spending cuts and reforms to reduce our debt, there will be no debt limit increase. And the cuts should be greater than the accompanying increase in debt authority the president is given. We should be talking about cuts of trillions, not just billions."

2) "They should be actual cuts and program reforms, not broad deficit or debt targets that punt the tough questions to the future."

3) "With the exception of tax hikes -- which will destroy jobs -- everything is on the table. That includes honest conversations about how best to preserve Medicare."

So at least $2 trillion in cuts, no tax hikes -- though it's unclear whether taking "tax hikes" off the table leaves room for cuts in tax expenditures that raise revenue while lowering rates -- and no recourse to debt triggers or other procedural mechanisms. In a subsequent interview with the Washington Post, Boehner's "aides declined to say over what period the cuts would have to take effect, saying only that they could be achieved on a time frame longer than the life of the debt-limit increase."

Boehner's got a big number, but it's not, over time, an impossible number. All of the major long-term budgets cut and raise more than $2 trillion over the next 10 years, so Boehner's demands, though impressive in the abstract, are actually in the center of deficit-reduction consensus. What's more questionable is his timetable. It's very unlikely that Congress will be able to cut a multi-trillion dollar deal on deficit reduction before early-August, when the Treasury runs out of financial gimmicks to delay a default. And if Boehner and the Republicans won't accept fiscal rules as a downpayment on deficit reduction, that leaves us with few options save for a series of hard-to-negotiate, short-term increases in the debt ceiling -- which is to say, an extremely extended period of uncertainty for the market.

Five in the morning

1) John Boehner has started listing debt limit demands, report Paul Kane and Lori Montgomery: "House Speaker John A. Boehner defined the GOP’s terms for raising the legal limit on government borrowing Monday, demanding that President Obama reduce spending by more than $2 trillion in exchange for an increase big enough to cover the nation’s bills through the end of next year. Delivering a sermon on fiscal austerity to a Wall Street crowd clamoring for compromise on the debt limit, Boehner (Ohio) firmly rejected any effort to raise taxes. He also called on Democrats to engage in 'honest conversations about how best to preserve Medicare,' signaling that House Republicans remain committed to restructuring at least some portions of the program."

Read Boehner's full speech: http://bit.ly/mExcJH

2) Obama will meet with the whole Senate to talk debt reduction, reports Felicia Sonmez: "President Obama will hold two separate meetings later this week with all Democratic and all Republican senators to talk about deficit reduction, White House Press Secretary Jay Carney announced Monday. Obama’s meeting with the Senate Democrats is scheduled to take place on Wednesday. He is expected to meet with Senate Republicans on Thursday. The meetings will come on the heels of Tuesday’s meeting at Blair House between Vice President Joe Biden and negotiators from both chambers, the second round in the White House-led deficit-reduction talks."

3) Sen. Kent Conrad is suggesting a short-term debt limit increase, reports Felicia Sonmez: "Senate Budget Committee Chairman Kent Conrad (D-N.D.) said Monday that Congress may need to approve a short-term increase in the nation’s debt ceiling to allow time to work out a comprehensive deficit-reduction plan without defaulting on its debt obligations. Currently, the Treasury Department projects that the country will reach its legal borrowing limit on Aug. 2. Republicans and Democrats have been jousting over the conditions under which members of Congress would be willing to take the politically unpopular vote to raise the debt limit. 'I can see a circumstance in which there would be some short-term [increase] so that the overall plan can be given the consideration that it deserves,' Conrad told reporters at the Capitol on Monday evening."

4) A Senate panel is finally voting on Obama's Nobel laureate Fed nominee, reports Victoria McGrane: "The Senate Banking Committee is slated to vote Thursday on the nomination of Peter Diamond to join the Federal Reserve Board, but his confirmation by the full Senate still remains doubtful. President Barack Obama first nominated Mr. Diamond to the post in April 2010. In the meantime, the Massachusetts Institute of Technology economist in October won a Nobel Prize in economics. But Republican opposition to Mr. Diamond hasn't waned. Sen. Richard Shelby (R., Ala.), the top-ranking Republican on the banking panel, continues to lead the fight against the nomination, arguing that Mr. Diamond doesn't have any direct monetary policy experience. Mr. Shelby said last week that the nomination remains 'in trouble.'"

5) Obama is speaking at the border today, report Peter Wallsten and Perry Bacon: "President Obama will stand on the U.S.-Mexico border Tuesday and try to take credit for something that eluded predecessors in both parties: successfully cracking down on illegal immigration. It is a record that Republicans roundly dispute. And it has drawn fire from many in Obama’s Latino base, who say the president has stepped up enforcement measures such as deportations while failing to deliver on his pledge to create a path to citizenship for millions of illegal immigrants. But in using a speech in El Paso to highlight his enforcement record, Obama will signal that he intends to try turning the immigration debate into a political winner among conservative swing voters who back tougher immigration policies."

Canadian pop interlude: The New Pornographers play "Use It" live.

Got tips, additions, or comments? E-mail me.

Still to come: Greece is edging closer to default; Sheila Bair is leaving the FDIC; Vermont is getting closer and closer to single payer; introducing the no-brainer awards; the GOP is holding up a top Justice nominee; the administration is moving around high-speed rail money; and two chinchillas in wine glasses.

Economy

Greece is on the brink of default, reports Howard Schneider: "Greece’s economic restructuring has slipped behind schedule, renewing fears that the country will default on its loans and triggering a new round of bailout talks for the European nation. European and International Monetary Fund officials have conceded in recent days that Greece needs help beyond the roughly $150 billion in emergency loans it received last year -- evidence of how difficult it is proving to restructure several weak economies in Europe and to reassure world markets that the euro currency zone has put its crisis to rest. Saddled with high levels of government debt and crippled financial systems, a whole tier of European countries is struggling to right their finances and overhaul their economies amid a sometimes wrenching sense of social change."

State attorneys general are still trying to hammer out a mortgage deal, report Brady Dennis and Dina ElBoghdady: "State attorneys general are descending on Washington again this week for negotiations with federal regulators and the nation’s largest mortgage servicers over the purpose of a multibillion-dollar fund aimed at helping troubled borrowers. The idea behind the yet-to-be-created fund, the size of which remains in flux but could eclipse $20 billion, is to punish the servicers for their shoddy foreclosure practices, which came to light in the fall, and to put that money toward keeping struggling homeowners in their homes. But deciding how to do that remains a complicated, contentious and politically fraught task."

FDIC chair Sheila Bair is on her way out, reports Dina ElBoghdady: "Sheila Bair, chairman of the Federal Deposit Insurance Corp., plans to leave her post this summer, the agency announced Monday. Bair’s five-year term ends June 30, but she will stay on a few days longer to attend her last FDIC board meeting, the agency said in a statement. Her departure will be effective July 8. For months, Bair has said she did not plan to serve a second term...Bair, a lifelong Republican who took over at the FDIC in 2006, was one of the first federal regulators to publicly warn about the aggressive lending practices that flooded the mortgage system with excessively risky loans during the housing market’s boom years...Her aggressive stance toward the industry often has put her at odds with fellow Republicans and some Obama administration officials, including Treasury Secretary Timothy F. Geithner."

The House used to not have to raise the debt limit at all, writes Joshua Green: "Why not just agree that the debt ceiling will rise to accommodate what Congress agrees to spend? After all, decisions about spending should be hashed out in the budget...In 1979, this very thought occurred to a young congressman named Richard Gephardt, who proceeded to do something about it...He consulted the parliamentarian. 'I asked if there was a way that when we pass the budget [the debt ceiling] can be deemed 'raised' to accommodate the budget people are voting for,' Gephardt said. 'He said, 'Yeah, we think we can work that out.''Thus was born the 'Gephardt rule.'... It didn't last. When Republicans took back the House in 1995, they brought back the second vote as a way to pressure members on spending."

The AT&T/T-Mobile merger fight isn't breaking down on party lines, report Eliza Krigman and Mike Zapler: "Congressional reaction to the AT&T/T-Mobile deal should be straightforward: Democrats wary of Big Business should oppose the wireless mega-deal, and free-market Republicans should happily embrace AT&T’s plans. But in the marquee telecom deal of the decade, nothing is that simple. Two powerful constituencies that typically align with Democrats are on opposite ends of the deal, as consumer groups have mobilized to stop it but several big labor unions have endorsed it. Republicans have their own complicating factor: Allowing the deal would leave just two dominant players in the field -- with Sprint a distant third -- and all but invite Ma Bell-style regulation of what has been a relatively freewheeling industry."

Greece should abandon the Euro, writes Mark Weisbrot: "The experience of Argentina at the end of 2001 is instructive. For more than three and a half years Argentina had suffered through one of the deepest recessions of the 20th century. Its peso was pegged to the dollar, which is similar to Greece having the euro as its national currency. The Argentines took loans from the International Monetary Fund, and cut spending as poverty and unemployment soared. It was all in vain as the recession deepened. Then Argentina defaulted on its foreign debt and cut loose from the dollar. Most economists and the business press predicted that years of disaster would ensue. But the economy shrank for just one more quarter after the devaluation and default; it then grew 63 percent over the next six years. More than 11 million people, in a nation of 39 million, were pulled out of poverty."

Obama should call Boehner's bluff, writes Jonathan Chait: "It seems to me that Obama's play here is clear: He needs to ask Boehner to spell out his demands. What's the exact bill that Boehner demands as a condition for not crippling the U.S. economy? If he wants to make demands, he needs to write out those demands. I don't think Boehner will do it. Boehner got through the government shutdown by cutting billions, not trillions, which allowed him to focus on small-bore programs and programs that only benefit the poor or vulnerable. But if he wants to cut trillions, then he faces real political peril. Boehner is trying to get around this problem by doing two things at once. He is placating his base by using a hostage strategy to force Obama to make concessions he doesn't like. But he also wants Obama to lend him cover to make highly unpopular spending cuts. Obama would be crazy to go along with that."

Our unemployment problem is structural, writes David Brooks: "There are probably more idle men now than at any time since the Great Depression, and this time the problem is mostly structural, not cyclical. These men will find it hard to attract spouses. Many will pick up habits that have a corrosive cultural influence on those around them. The country will not benefit from their potential abilities. This is a big problem...It will probably require a broad menu of policies attacking the problem all at once: expanding community colleges and online learning; changing the corporate tax code and labor market rules to stimulate investment; adopting German-style labor market practices like apprenticeship programs, wage subsidies and programs that extend benefits to the unemployed for six months as they start small businesses."

Adorable animals in confined spaces interlude: Two chinchillas in wine glasses.

Health Care

Jon Cohn previews what's next for the health-care law in the courts "lower court decisions still matter, both for the ways they frame the judicial debate and how they shape public perceptions. The Obama Administration seems to grasp this, having decided that acting Solicitor General, Neal Katyal, will argue the case in person. Dispatching the government's top legal advocate to a Circuit Court case is not unprecedented, but it's unusual, as The Atlantic's Andrew Cohen notes, 'With all due respect to the appellate attorneys who otherwise would have handled this argument, this is the equivalent of the Boston Red Sox sending their star pitcher down to the minor leagues, to the Pawtucket Red Sox, to make a start in Game 7 of a playoff series.'"

Northwestern University law professor Andrew Koppelman argues that that the law is clearly constitutional: "The constitutional objections are silly. However, because constitutional law is abstract and technical and because almost no one reads Supreme Court opinions, the conservative majority on the Court may feel emboldened to adopt these silly objections in order to crush the most important progressive legislation in decades. One lesson of Bush v. Gore, which did no harm at all to the Court’s prestige in the eyes of the public, is that if there are any limits to the Justices’ power, those limits are political: absent a likelihood of public outrage, they can do anything they want. So the fate of health care reform may depend on the constitutional issues being understood at least well enough for shame to have some effect on the Court."

Vermont is coming closer and closer to single payer, explains Kevin Outterson: "They can do a single-payment system fairly quickly for the state and municipal employees and the individual and small-group exchange markets that they regulate under the ACA. So that’s the core. And it’s pretty substantial. And if they get Blue Cross in, then they get Blue Cross’s customers. Then there’s Medicaid and Medicare, which will be a long process going back-and-forth with the Center on Medicaid and Medicare Services. And then the discussion with the big employers is happening now, as Vermont can toss this tax into place pretty quickly, which will force those guys in."

Domestic Policy

The GOP is blocking Obama's nominee for the #2 post at Justice, reports David Fahrenthold: "Republicans in the U.S. Senate voted Monday to block President Obama’s choice for the No. 2 position in the Justice Department, leaving the nominee in an official limbo that has already lasted months. James M. Cole, a Justice Department veteran turned white-collar defense lawyer, was nominated for the post of deputy attorney general last May. But Republicans objected, citing, among other concerns, Cole’s previous support for trying international terrorism suspects in U.S. criminal courts. On Monday, 353 days after his selection, Senate Democrats tried to force a final vote on Cole’s nomination. But their bid fell short of the 60 votes needed to overcome a Republican filibuster threat: the tally was 50 to 40, with 10 senators absent and not voting."

Sen. Jay Rockefeller wants to ban companies from tracking customers' web activity, reports Cecilia Kang: "Sen. John D. Rockefeller (D-W.Va.) on Monday introduced an online “do not track” privacy bill that would allow consumers to block Internet companies from following their activity on the Web. The Do-Not-Track Online Act of 2011 comes amid increased attention by lawmakers on creating privacy rules for the Internet. The White House has called for such rules but has not supported a specific mandate that would block companies from tracking users...His legislation would force companies to abide by a consumer’s choice to opt out of such data collection. The Federal Trade Commission would draw up specific 'do not track' rules. The agency and states' attorneys general would enforce the law."

Arizona is appealing a ruling against its immigration law, reports Jennifer Epstein: "Jan Brewer is not done with the immigration fight yet. On Monday, the Arizona governor announced plans to appeal a ruling against the state’s controversial immigration law to the U.S. Supreme Court, she announced Monday. The state has decided to challenge the Ninth Circuit Court of Appeals’s ruling blocking the implementation of some parts of the law - including provisions requiring immigrants to carry documentation and allowing police enforcing other laws to check the immigration status of people they’ve stopped...A three-judge panel on the circuit court ruled in April that the Justice Department was likely to be able to prove the law unconstitutional and that only the federal government has the authority to enforce immigration laws."

My column: Introducing the no-brainer awards: "This column is usually about the Big Issues. Health-care reform. The deficit. The debt ceiling. The grand, Ragnarok-level clashes (you were into Norse mythology when you were younger, too, right?) between the two parties. But not today. Today I want to introduce the No-Brainer Awards: a roll call honoring some of the best legislative ideas you won’t see leading the evening news. These thoughtful bills and responsible reforms aren’t polarizing or sweeping, which you’d think would make it easier for them to pass. But for many of them, the absence of partisan passion means they never make it to the front of the congressional agenda. So let’s give them a push."

Supercut interlude: A tribute to great sandwiches in the movies.

Energy

The administration is moving around $2 billion in high speed rail money, reports Ashley Halsey: The Obama administration on Monday announced the reallocation of $2 billion in its signature transportation program to create a national high-speed rail network, including $795 million for upgrades that would permit speeds of 160 mph in parts of the Northeast Corridor. U.S. Transportation Secretary Ray LaHood made the money available to other states this year when Florida Gov. Rick Scott (R) opted not to accept funds that had been allocated to build high-speed rail between Tampa and Orlando. LaHood said almost 100 applications came in from 24 states, the District and Amtrak...Scott and two other Republican governors elected last year -- John Kasich of Ohio and Scott Walker of Wisconsin -- rejected high-speed rail money."

2012 candidates are acquiring energy policy advisors, reports Darren Samuelson: "The mating dance has begun between Republican presidential candidates and a crop of seasoned energy experts. Several former GOP administration, Capitol Hill and industry officials tell POLITICO they've been talking to the budding White House campaigns about signing on as volunteers or paid advisers on energy matters...Romney keeps in regular touch with Mike Leavitt, a former Utah governor who led both HHS and the EPA under Bush. He's also getting help from Jeff Holmstead, a fellow Mormon and former top Bush EPA air pollution chief who now works at the Bracewell & Giuliani law firm... Ed Krenik, a former EPA congressional affairs director, said he's already spoken with a couple of budding GOP campaigns."

High gas prices mean boom times for electric cars, writes Seth Fletcher: "The American response to rising gas prices has been depressingly predictable. We’re shocked to see prices top $4 a gallon, as if it’s never happened before. We demand that something be done -- not to reduce our dependence on oil, but to cut the cost of a fill-up. Fortunately the White House is standing behind a goal that could genuinely transform the nation’s automotive fleet: putting one million electric vehicles on the road by 2015...When cars like these are being driven on a large scale, the benefits will be substantial. The Electrification Coalition, an electric-vehicle advocacy group, estimates that if, by 2040, 75 percent of all miles driven in the United States are powered by electricity, oil consumption by light-duty vehicles will drop from the current level of nearly nine million barrels a day to two million."

Closing credits: Wonkbook is compiled and produced with help from Dylan Matthews and Michelle Williams.

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May 10, 2011