What happens if the sequester sky doesn’t fall?... To count, we’re now on our 5^th and 6^th fiscal standoffs since 2011… Brace yourself for the Supreme Court to eliminate all federal campaign contribution limits… The more things change on immigration (see McCain and Rubio working on reform), the more some things stay the same (see yesterday’s McCain town halls)… On the gun debate and presidential leadership… Frank Fahrenkopf sounds off… Breaking down some of the RNC’s post-2012 recommendations… And all tied up in Virginia.

*** What happens if the sequester sky doesn’t fall?  Another day, another back-and-forth over the looming automatic budget cuts -- the so-called sequester -- set to commence on March 1. In an attempt to try and score some P.R. points (at least with conservatives), House Speaker John Boehner has penned a Wall Street Journal op-ed placing the blame for these upcoming cuts squarely on President Obama. “The president's sequester is the wrong way to reduce the deficit, but it is here to stay until Washington Democrats get serious about cutting spending… So, as the president's outrage about the sequester grows in coming days, Republicans have a simple response: Mr. President, we agree that your sequester is bad policy. What spending are you willing to cut to replace it?” Well, White House senior adviser Dan Pfeiffer has responded with a “setting the record straight” blog post pointing out 1) Obama does have a plan to replace the sequester cuts, 2) Boehner had boasted in the past that the sequester was leverage to extract entitlement cuts, and 3) the House GOP has yet to pass a plan in this Congress to replace the sequester. And today, Obama is conducting interviews with eight local TV stations (including some military-heavy markets like San Antonio and Honolulu) to pressure Republicans to come to an agreement to avoid the sequester. But here’s a question we have: Is the public listening anymore?

*** To count, we’re on our fifth and sixth fiscal standoff since 2011: After all, we’re now on our fifth fiscal standoff since Republicans took over the House in 2011 (the threatened government shutdown, the debt ceiling, the Super Committee, the fiscal cliff, and now the sequester). And later in March, we’ll see our sixth standoff (another battle over shutting down the government). Each time in the past, Democrats and Republicans have come to some sort of agreement that avoids the looming fiscal disaster but that also kicks the larger can down the road. So what happens if the sky doesn’t fall -- immediately -- after March 1? In fact, the New York Times notes that while these looming sequester spending cuts will have an impact on the economy, they’re unlikely to have an immediate effect. “Rather, they will ripple gradually across the federal government as agencies come to grips in the months ahead with across-the-board cuts to all their programs.” If that’s the case, does this kind of public campaign we’re seeing (Obama arguing that essential jobs will be lost, Republicans pinning the blame on the president) actually work? It’s something to chew on as both sides begin to wage a furious P.R. campaign before March 1. By the way, check out Wall Street -- record highs all over the place. Translation: Wall Street has stopped fearing Washington. They now only hear “posturing” when the two sides talk, and if Wall Street doesn’t believe the threats coming out of Washington, then the public might not be far behind.

J. Scott Applewhite / AP

House Speaker John Boehner of Ohio arrives to meet with reporters on Capitol Hill, Thursday, Feb. 14, 2013.

*** Brace yourself for the Supreme Court to eliminate all campaign-contribution limits: As NBC’s Pete Williams reported yesterday, the U.S. Supreme Court has agreed to delve into the controversial issue of money and politics -- again. This time, the court agreed to take up a challenge brought by an Alabama man who claims it's unconstitutional to prevent him from giving more than $46,200 to candidates and $70,800 to PAC's and political committees, Williams notes. The Alabama man doesn’t challenge the limit on contributions to an individual candidate, but he does claim it's unconstitutional to prevent him from contributing to as many candidates as he wishes. What every political observer should brace for, especially after the Citizens United decision, is that the Supreme Court could potentially eliminate ALL federal contribution limits. Indeed, note that the Republican National Committee joined the Alabama man on this court challenge. And as NBC’s Kasie Hunt reports (more on this below), one of the RNC’s recommendations after the GOP’s losses in 2012 is giving the parties a bigger role in fundraising vs. outside groups – and one way to do this is to eliminate the contribution limits.

*** The more some things change, the more they stay the same: On the one hand, the politics behind achieving immigration reform haven’t been more promising as they are right now. Yesterday, we learned that President Obama called three of the four Republican senators working on a bipartisan effort to achieve comprehensive immigration (John McCain, Lindsey Graham, and Marco Rubio). And Rubio’s office issued an encouraging statement, especially after it had complained the Obama White House hadn’t sought its input on reform. "Sen. Rubio appreciated receiving President Obama's phone call to discuss immigration reform late tonight in Jerusalem," Rubio’s spokesman said. "The senator told the president that he feels good about the ongoing negotiations in the Senate." (Can’t help but wonder how much of this is both sides doing what they have to do on the theatrics front.) On the other hand, it appears that the politics also haven’t entirely changed since reform tanked in 2005-2007. Just see the reaction from McCain’s two town halls yesterday in Arizona. The AP: “Some audience members shouted out their disapproval [at McCain’s call for a legal path for illegal immigrants. “One man yelled that only guns would discourage illegal immigration. Another man complained that illegal immigrants should never be able to become citizens or vote. A third man said illegal immigrants were illiterate invaders who wanted free government benefits.”

*** On the gun debate and presidential leadership: While the Obama White House has taken sort of a backseat in the immigration debate -- at least for now -- to let Congress work its will, it’s striking to note the active role it has taken in the gun debate after Newtown. Ask yourself this question: Where would this issue be, even the chance at getting universal background checks, without the president putting his shoulder behind the issue. This is an example of why presidential leadership does matter in politics. The irony in all of this: Guns were never an issue Obama campaigned on during the 2012 election. Every two or three days, there’s a new gun event being pushed by the White House. Yesterday, it was the Biden Facebook townhall, which gave social media its quote of the day: If you want to protect yourself, get a double-barrel shotgun,” he said, per Roll Call.

*** Frank Fahrenkopf sounds off: Speaking of the 2012 election, don’t miss one of the old-guard Republican establishment figures -- former RNC Chair Frank Fahrenkopf -- sounding off on his party, Washington, and the media during a talk in Las Vegas. As Nevada political reporter Jon Ralston writes, Fahrenkopf “presented a blizzard of by-now familiar statistics of how Mitt Romney had his clock cleaned by President Obama among minorities and young people.” (“And I thought McCain’s campaign was the worst I’d seen in modern history,” Fahrenkopf said.) More: “Fahrenkopf said the GOP should take the position that the country needs ‘sensible, fair, immigration reform.’” And: “Fahrenkopf couldn’t resist a criticism of New Jersey Gov. Chris Christie’s embrace of Obama during Hurricane Sandy, providing this cringe-worthy description: ‘He kissed him. He didn’t have to French-kiss him. I think he went overboard.’”

*** Breaking down some of the RNC’s recommendations after their 2012 losses: Meanwhile, NBC’s Kasie Hunt reports that Republican Party officials studying how to rebuild the party in the wake of 2012 losses are hoping to release their set of recommendations by mid-March -- and the list of fixes is already beginning to take shape. Some of these recommendations, per Hunt: 1) expanding the map and increasing voter contact; the party needs a plan that's not dissimilar to former DNC Chairman Howard Dean's 50-state strategy as it tries to expand the map beyond traditional red states; 2) changing campaign finance. The GOP team worries about how much new campaign finance law has weakened the national party structure, handing more power to outside groups on both sides of the aisle -- and giving a louder voice to both the left- and right-wing; and 3) limiting presidential primary debates.

*** All tied up in Virginia: Finally, turning to this year’s gubernatorial contest in Virginia, a new Quinnipiac poll finds the race is pretty much tied – whether or not GOP Lt. Gov. Bill Bolling decides to mount a third-party challenge. In a straight head-to-head match-up, the poll has Democrat Terry McAuliffe and Republican Ken Cuccinelli tied at 38% among registered Virginia voters. And in a three-way race, it’s McAuliffe at 34%, Cuccinelli at 31%, and Bolling at 13%. Folks, Bolling is polling at 13%, and he hasn’t even announced. If he gets any kind of serious financial support, he can become a real threat. Do NOT take this candidacy lightly. This is not some spoiler in the works. Democrats shouldn’t be rooting for Bolling to get in because they simply think he’ll split GOPers and indies with Cuccinelli. Bolling is positioning himself to the left of some of the state’s more mainstream GOPers, including Gov. Bob McDonnell.

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President Barack Obama finally broke his silence on an issue of national importance Friday – he thinks it’s time to retire the penny.

The possible extinction of the one-cent coin was a featured economic question in a Google+ Hangout with the Commander in Chief last week as John Green, the co-creator of a popular YouTube channel, applied a little presidential peer pressure.

“Australia, Canada, New Zealand, many other countries have gotten rid of their pennies,” Green said. “Why haven’t we done it?”

“I gotta tell you, John, I don’t know,” Obama responded, adding, “Anytime we’re spending money on something people don’t actually use, that’s an example of things we should probably change.”

RELATED: Conservative thinkers: GOP should cut 'stale' policies loose

But why should anyone care? They’re pennies. Aren’t there more valuable things to worry about?

First, pennies actually cost more to make than they’re worth. In 2012, every penny cost 2.41 cents to make – more than twice their face value.

And as zinc and copper – materials used in minting the penny – have become costlier due, in part, to manufacturing shifts in China, which are likely to raise costs further.

Granted, the total cost of minting pennies was only $58 million last year – less than one-tenth of a percent of total federal spending in 2012 – but groups like Citizens to Retire the U.S. Penny have long been making the economic case for getting rid of the penny (plus, the group adds, fishing for pennies adds about 2 seconds to each cash transaction per day).

And the U.S. military has already decided they’re essentially useless; all Army and Air Force Exchange Service stores on bases round all cash purchases up or down to the nearest nickel.

With both parties looking for ways to cut government spending, it seems as though cutting penny production could be a relatively painless, if insignificant, place to start. But in the Google+ Hangout, Obama ceded that Washington has bigger fiscal fish to fry.

“The penny is an example of something that I need legislation for,” he said. “And, frankly, given all of the big issues that we have to deal with day-in/day-out, a lot of times it just doesn't -- you know, we're not able to get to it.”

There have actually been efforts to pass penny-banning legislation. Back in 2001, then-Rep. Jim Kolbe (R-AZ) introduced the “Legal Tender Modernization Act,” which would have made pennies obsolete by requiring retailers to round up or down to the nearest nickel on cash purchases.

That bill failed, and Kolbe’s second attempt in 2006, the “Currency Overhaul for an Industrious Nation (COIN) Act,” after zinc costs nearly doubled, met a similar fate.

But the president doesn’t need Congress to explore other, cheaper alternatives to zinc – the main metal in pennies. In fact, the administration’s 2013 budget encourages the Treasury to “explore, analyze, and approve new, less-expensive metals for all circulating coins like aluminum, iron and lead.”

It wouldn’t be the first time Abe Lincoln’s coin got a makeover. Back in 1982, the penny changed from 95 percent copper and 5 percent zinc to 97.5 percent zinc and 2.5 percent copper.

(And lest so-called “penny hoarders” try to melt that valuable pre-1982 copper down, the Mint in 2006 prohibited the melting of pennies and nickels. It also made it a crime to carry more than $5 in one and five-cent coins out of the country).

Changes to the composition of pennies do have Congressional champions: Ohio Rep. Steve Stivers (R) introduced the “Cents and Sensibility Act” in December 2011, which would mandate that pennies were out of American steel (much of which comes from the Buckeye State) and dipped in copper. 

But these efforts will be met with some serious resistance from the zinc lobby (yes, there is one). The company Jarden Zinc, which creates “metal and zinc coinage,” according to its website, paid lobbyist Mark Weller $340,000 in 2012 to discuss issues related to “minting/money/gold standard” with members of Congress and the Mint, according to the Center for Responsive Politics.

Weller also represents the pro-penny group Americans for Common Cents, whose website warns of the risk of inflation that eliminating the penny would bring, and whose headquarters are on K Street, known for its many D.C. lobbyist offices. 

“Americans for Common Cents aims to inform and educate policymakers, consumers, and the media about the penny’s economic, cultural, and historical significance,” the group’s website reads.

The political power of the penny is likely another reason Obama hasn’t acted on getting rid of it. As far back as 2008, when he was still a candidate, the “penny lobby” appeared to mystify Obama.

Asked about it at a town hall in Pennsylvania, he said, “We have been trying to eliminate the penny for quite some time -- it always comes back,” joking, “I need to find out who is lobbying to keep the penny.”

This story was originally published on Tue Feb 19, 2013 2:51 PM EST

President Barack Obama used his bully pulpit Tuesday to warn of calamitous consequences for the U.S. economy should the automatic spending cuts known as the “sequester” go into effect next Friday.

The president warned that the automatic cuts, totaling about $85 billion over the course of this year, would prompt job losses, weakened national security and canceled government services – among other consequences.

“So these cuts are not smart, they are not fair, they will hurt our economy, they will add hundreds of thousands of Americans to the unemployment rolls,” Obama said in a statement at the White House. “This is not an abstraction; people will lose their jobs. The unemployment rate might tick up again.”

The speech featured no new, concrete proposal from the president detailing how he would prefer for Congress to replace the sequester.

Democrats in Congress released a plan last week that called for $55 billion in new revenues from closing tax loopholes and deductions, and additional cuts by $27.5 billion to each the defense and discretionary spending budgets over the course of the next decade.

Obama’s speech was otherwise spent reiterating points he’s made for the better part of the last two months. He said that any sequester replacement should be “balanced” – shorthand for a combination of new tax revenue and spending cuts – and Obama urged lawmakers to approve a shorter-term replacement for the automatic cuts if they couldn’t reach consensus on a broader package by the end-of-February deadline. 

Rather, the president, who was flanked by first-responders whose jobs Obama said would be threatened by the sequester, was making use of political optics and the presidential bully pulpit to pressure Congress to act. 

Still, the urgency appeared to have little effect on Republicans, who dismissed the president’s remarks as unserious about reaching a solution. 

"Once again, the president offered no credible plan that can pass Congress – only more calls for higher taxes," House Speaker John Boehner, R-Ohio, said in a statement.

“Today's event at the White House proves once again that more than three months after the November election, President Obama still prefers campaign events to common sense, bipartisan action,” Senate Minority Leader Mitch McConnell, R-Ky., said in a statement. 

Indeed, many Republicans have treated the sequester as a fait accompli; Congress is out of town this week, and lawmakers would only have a handful of days next week to act upon the sequester. Some Republicans have also argued that even if the sequester is replaced, its $85 billion in cuts should set a baseline for offsetting cuts in other areas of the budget. 

“I have to say, though, that so far, at least, the ideas that the Republicans have proposed asks nothing of the wealthiest Americans or biggest corporations,” Obama said of the GOP proposal. “So the burden is all on first-responders or seniors or middle-class families. They doubled down, in fact, on the harsh, harmful cuts that I've outlined.”

The president added, as if to drive home the point: “Well, that's not balanced. That would be like Democrats saying we have to close our deficits without any spending cuts whatsoever. It's all taxes. That's not the position Democrats have taken, that's certainly not the position I've taken.”

This story was originally published on Tue Feb 19, 2013 11:04 AM EST

PUBLISHED 2:29 p.m. ET -- President Barack Obama told his House Democratic colleagues that he would continue to challenge Republicans on how to best replace the impending sweeping spending cuts known as the "sequester."

Speaking at the House Democratic Issues Conference in Leesburg, Va., Obama said he wants to create an alternative to the sequester that includes some entitlement reforms but also more revenue through ending loopholes and deductions for the wealthiest earners, a point of disagreement with GOP lawmakers.

“I am prepared, eager and anxious to do a big deal, a big package that ends this governance by crisis,” he told the crowd.

Obama decried Republicans, who, he said, recognize “that the sequester is a bad idea, but what they've suggested is that the only way to replace it now is for us to cut Social Security, cut Medicare and not close a single loophole, not raise any additional revenue from the wealthiest Americans or corporations who have a lot of lawyers and accounts.”

While the president seemed to lament the lack of communication between himself and House Republicans, neither side has indicated that they negotiating in public or private. Earlier Thursday, White House press secretary Jay Carney lambasted House Speaker John Boehner’s reported offer, which includes cuts to Medicare premiums and federal pension programs, as “terrible.”

At the issues conference, Obama said he was steeling himself for another philosophical fight over cuts with the Republicans.

“I have to tell you, if that's an argument that they want to have before the court of public opinion, that is an argument I'm more than willing to engage in,” he said to applause.

But disagreements might not just be limited to the Republican side, the president added, saying he’s prepared to clash with fellow Democrats on key issues like immigration and gun safety.

“There will be times where you guys are mad at me, and I'll occasionally read about it,” he said.                 

Despite any such intra-party bickering, the president said he still believed Democrats would be in a good position in 2014 to retake the House of Representatives.

“As a by-product of doing that good work and keeping that focus, I would expect that Nancy Pelosi's going to be speaker again pretty soon,” the President concluded his remarks with, as the crowd erupted in cheers for their leader.

Updated at 2:42 p.m. ET: In the Budget Control Act of 2011, President Barack Obama and Congress created a fail-safe device intended to spur agreement on a “grand bargain” of spending reductions and tax increases. The law, enacted as part of an escape from a potential debt limit crisis, created the famous “super committee” of 12 members of Congress which was assigned the job of devising entitlement and tax reforms which would reduce deficits by $1.5 trillion over ten years.

But the law included a default option: if the committee failed in its mission, then automatic spending cuts, called “the sequester,” would begin.

Neither Obama nor most congressional Republicans were happy with the prospect of automatic spending cuts, but once the president put his signature on the bill, those cuts were built into the law. Congress, of course, was free at any point to enact a new law to undo the cuts, but so far it hasn’t done so. Now that the cuts are less than a month from beginning, Obama is again warning of their effects.

Related: Budget battle resumes

In his statement Tuesday he called them “massive automatic cuts” and “deep, indiscriminate cuts to things like education and training, energy and national security” which he said “will cost us jobs, and it will slow down our recovery.” A few minutes later for emphasis he repeated the phrase “indiscriminate cuts.”

On Saturday Deputy Defense Secretary Ashton Cater, in a speech at an international security conference in Munich, called the imminent cuts “huge and reckless” and said they would cause “devastating damage to the military.”

Nowhere in Obama’s statement Tuesday did he mention the exact dollar amount or percentage amount of the cuts that are slated to begin on March 1.

So how big are they? And are they “indiscriminate?"

To answer the second question first: in one sense, the cuts are not indiscriminate.

The Budget Control Act does in fact discriminate between entitlement programs, such as Social Security, in which benefit payments are automatically made to those people eligible for them, and what are called discretionary programs, such as the spending on the National Institutes of Health, the Federal Aviation Administration, or the National Park Service, which receive annual appropriations that can go up or down each year depending on the decisions of Congress.

For the most part, the cuts in the BCA exempt the entitlement programs: Grandma’s Social Security check is exempt, as is Uncle Pete’s veterans benefits check, but spending on NIH cancer research and on Zion National Park in Utah, for instance, is not.

As the Bipartisan Policy Center explained in a report last year, “The specified exemptions include Social Security, federal (including military) retirement programs, veterans benefits, Medicaid, and a host of other programs (mostly those benefitting individuals with low incomes). Furthermore, while Medicare would be subject to the sequester in the form of provider payment cuts, those cuts could not exceed two percent.”

But in another sense the cuts are indiscriminate in that they do not eliminate specific redundant or inefficient programs. The cuts are across-the-board to every federal department.

Recommended: GOP embraces cosmetic makeover, tweaking tone not principles

Alex Wong / Getty Images

President Barack Obama makes a statement during a press conference at the Brady Press Briefing Room of the White House February 5, 2013 in Washington, DC.

How big will the cuts be in the current fiscal year?

Keep in mind that the current fiscal year, FY2013, began on Oct. 1 so Obama administration officials will have to implement 12 months’ worth of cuts in only seven months.

The Congressional Budget Office said in its annual budget forecast Tuesday that the automatic cuts will reduce spending by $85 billion in FY2013.

Even with the cuts taking effect, total federal spending will still be more than $3.5 trillion, a higher total than in FY2012. At 22.2 percent of gross domestic product in the current fiscal year, federal spending is high by the standards of the past 50 years. The 50-year spending average is 21 percent of GDP.

At the end of the Clinton presidency, a time which many people see as one of prosperity and when in fact there was a budget surplus, federal outlays amounted to only 18.2 percent of GDP. That’s partly because the economy was thriving, so the federal share of it was smaller than it would have been otherwise. When the economy is sluggish as it is today, federal spending – much of it automatic cash transfers in the form of entitlement spending – is relatively larger than it would be if the economy were flourishing.

The automatic cuts mandated by the Budget Control Act will reduce defense spending (other than spending for military personnel) by about 8 percent and non-defense discretionary spending by between 5 percent and 6 percent in FY2013, the CBO said Tuesday.

Members of Congress in both parties – especially those with military bases in their states or districts – have voiced alarm about the effect of the defense cuts. At last week’s confirmation hearing for Obama’s defense secretary nominee Chuck Hagel, Sen. Kay Hagan, D-N.C. told Hagel, “Stopping sequestration from occurring is very important to me. North Carolina -- we have seven military institutions -- installations, and we have over a hundred thousand active-duty service members in my state.”

The BCA cuts, she said, “are going to harm our national security, will impair our readiness, will defer necessary maintenance that will help keep our troops safe and delay important investments in research and procurement as well as stunt our economic recovery at this time.”

Hagan was one of 74 senators voting for the BCA in 2011.

At a press conference at the Capitol Wednesday at which Republican members of the House and Senate Armed Services Committees offered a proposal to avert spending cuts by means of cuts in federal civilian employee head count, Sen. Lindsey Graham, R- S.C. said, “We have our fingerprints as Republicans on this proposal, on this sequestration idea. It was the president’s idea, according to Bob Woodward’s book, but we as the Republican Party agreed to it. We got into this mess together and we’re going to have to get out together….. To the president: we bear responsibility as Republicans for allowing this to happen. Lead us to a better solution.”

Graham was one of the 26 senators who voted against the BCA in 2011.

The Senate approved a three-month suspension of the debt limit on Thursday, sending it to the White House for President Barack Obama’s likely signature.

The upper chamber voted 64 to 34 to add its approval to a plan conceived by House Republicans, which would push the deadline at which the government runs out of authority to borrow money to finance its obligations until May 18. The government would have otherwise run out of money within a matter of weeks.

In exchange for the extension of borrowing authority, both the House and Senate must now draft and approve separate budget resolutions by mid-April. The legislation approved Thursday by the Senate and last week by the House would place lawmakers’ pay into escrow if they were to fail to pass a budget.

The Obama administration has indicated that while the president would have preferred a longer-term extension of the debt ceiling, it did not oppose the short-term extension. Obama is expected to sign the legislation into law.

Attention will now turn to the normal budgeting process that typically dominates the first few months of the calendar year in Congress. Republicans’ gambit in offering this proposal was to highlight how Senate Democrats had failed to pass a formal budget resolution in the last four years. (Democrats argue they were working off of a de-facto budget stipulated by various spending cut agreements passed by Congress.)

Leaders of both chambers have suggested they’ll push ahead with ambitious, and markedly different, budgets.

Wisconsin Rep. Paul Ryan, the chairman of the House Budget Committee, will lead the GOP’s efforts; he’s vowed to produce a budget that would balance the budget in the next 10 years without raising any new taxes.

Senate Democrats, meanwhile, have said they plan to seek additional revenues from taxes in the budget they will produce. Washington Sen. Patty Murray, D, the chairwoman of the Senate Budget Committee, will lead that effort.

Republicans are dug in as ever against raising new taxes, and their budgetary standard-bearer, Wisconsin Rep. Paul Ryan, said Sunday that the Republican House of Representatives has already moved past the question of new revenues. 

Ryan, the House Budget Committee chairman and former GOP vice presidential nominee, laid out the contours of what will almost certainly be a bruising springtime debate on taxes and spending — an outgrowth of the unresolved consequences of the "fiscal cliff."

And as the GOP-held House and the Democratic-controlled Senate prepare dueling budget proposals, Ryan argued that the president was unserious about tackling the mounting national debt. 

"The president got his additional revenues. So that's behind us," Ryan said on NBC's "Meet the Press" in his first live interview since the presidential election, when Ryan and presidential candidate Mitt Romney lost decisively to President Barack Obama. 

During the campaign, Romney and Ryan talked forcefully about reforming taxes and raising revenues by closing loopholes and deductions that favor the wealthy. While Democrats won higher taxes on household income over $450,000 as part of the New Year's deal to stave off the automatic tax hikes and spending cuts in the fiscal cliff, Democrats now say they'll produce a budget asking for even more revenue, possibly through similar tax reforms.

"Are we for raising revenues? No we're not," Ryan said. "If you keep raising revenues, you're not going to get decent tax reform."

The Wisconsin congressman's comments portend a debate over taxes and spending in Washington featuring parties as far apart as ever. Republicans this week passed legislation to suspend the debt limit — and, with it, the specter of default — until May. But Congress must still reckon with the need to continue funding the government, and address the automatic and drastic spending cuts (known as the "sequester") that were delayed only for two months as part of the fiscal cliff.

"I think the sequester's going to happen," Ryan said, blaming Democrats for offering no palatable substitute for those cuts. 

And Ryan said that Republicans were "not interested" in a government shutdown, the consequence for which some GOP lawmakers have openly called should Obama and lawmakers fail to reach an agreement to fund the government.

But those looming questions — which are tied directly into the budgets that the House and Senate will debate this spring — reflect how Washington remained as vexed as ever by fiscal issues. 

And the rhetoric is hot as ever, too.

"I don't think that the president actually thinks we have a fiscal crisis," Ryan said. 

With tax and spending matters set to dominate much of lawmakers' energy for the first half of this year, it could make other elements of Obama's agenda — like immigration reform and curbing gun violence — more politically difficult. 

Ryan, who has praised a bipartisan set of immigration reforms offered by Florida Sen. Marco Rubio, R, said he was cautiously optimistic about the prospects for immigration reform this year. But Ryan said that Democratic and Republican lawmakers alike would closely watch Obama's speech on Tuesday in Nevada on that topic.

And of the president's gun control measures, Ryan suggested openness to embracing some measures — like requiring universal background checks on gun sales — while expressing skittishness toward other elements of the plan, like the ban on assault weapons.

As Ryan himself navigates these very thorny issues for the next four years, his every action will be refracted through the prism of 2016 presidential politics. After having emerged as something of a GOP rock star as Romney's running mate last fall, many Republicans hope that the Wisconsin congressman might seek the presidency himself in four years, joining a tentative field of Republican contenders for the nomination that is full of proverbial heavyweights.

Ryan offered a familiar answer about his own potential ambitions, saying he doesn't think about running, and that he was currently focused on his job serving his constituents. 

"I think it's just premature. I've got an important job to do," he said. "I'll decide later about that."

Handing a huge legal victory to Republicans, a federal appeals court in Washington has ruled that a president can make recess appointments only during a congressional recess when the vacancies arise.

The ruling came Friday from a three-judge panel of the US Court of Appeals for the District of Columbia.  Business groups challenged last year's recess appointments to the NLRB, the National Labor Relations Board, and the court ruled today in their favor.

"The filling up of a vacancy that happens during a recess must be done during the same recess in which the vacancy arose," the court said.

Last January, President Barack Obama infuriated Senate Republicans by naming Richard Cordray to be director of the newly formed Consumer Financial Protection Bureau, and by putting three new members on the NLRB. (Obama re-nominated Cordray to a full appointment at the same position on Thursday.)

"It's clear the president would rather trample our system of separation of powers than work with Republicans to move the country forward," House Speaker John Boehner said at the time.  "I expect the courts will find the appointment to be illegitimate."

The court ruled today on a challenge to the appointments brought by a Pacific Northwest soft drink bottler who lost a union dispute before the NLRB. The company claimed that the president had no power to appoint the new NLRB members, and that the subsequent action by the board therefore lacked legitimacy.

At the core of the dispute is Article II of the Constitution, setting out the president's duties and authorities. They include "the power to fill up all vacancies that may happen during the recess of the Senate."

During the nation's first century, Congress was in session less than half a year. The recess appointment power allowed the president to keep the government functioning by filling important jobs when the Senate was not around to act on nominations.

"There is no reason the Framers would have permitted the President to wait until some future intersession recess to make a recess appointment, for the Senate would have been sitting in session during the intervening period and available to consider nominations," the court said today.

In modern times, presidents of both parties have used the power to make appointments during much shorter congressional recesses in the summer and around holidays. 

But during the George H.W. Bush administration, Democrats came up with the idea of pro forma sessions, in which the body was gaveled to order then immediately adjourned for another few days. They claimed that the Senate remained in session and recess appointments could not be made. Senate Republicans have since continued the pro forma practice. 

"Such short intra-session breaks are not recesses," the bottling company argued.  "Otherwise, every weekend, night, or lunch break would be a 'recess' too."

Senate Republicans joined the lawsuit. They argued that by declaring the Senate incapable of performing its functions during the pro-forma sessions, "the President usurped the Senate's control of its own procedures. And by appointing officers without the Senate's consent, he took away its right to review and reject his nominations."

The Obama Justice Department argued that the pro-forma procedures, each lasting less than a minute, are a sham and do not mean the Senate was actually in session.  "It could not provide advice or consent on presidential nominations during that 20-day period," government lawyers argue.

In agreeing to its holiday break, Justice Department lawyers note, the Senate "provided by order that 'no business' would be conducted."

The government lawyers said there's nothing mysterious about the meaning of the word recess -- "a break by the Senate from its usual business, such as periods in which the Framers anticipated that senators would return to their respective states."
 
"The pro forma sessions were not designed to permit the Senate to do business, but rather to ensure that no business was done," the Justice Department claimed.

President Obama invoked the recess appointment power 32 times during his first term to fill vacancies in full-time government positions, though he has not made any since last January's controversy. President Clinton made 95 recess appointments during his administration.  President George W. Bush used the power 99 times. 

If, as seems likely, the issue gets to the Supreme Court, the justices could settle a passionate debate over a presidential power used hundreds of times, stirring controversy since the beginning.

The House of Representatives authorized a suspension of the nation’s debt limit through mid-May, delaying a default on the government’s obligations that would have taken effect in February.

The GOP-controlled House voted 285 to 144 to comfortably pass a three-month extension in the government’s borrowing authority just as Senate Democratic leaders suggested they would take up and pass the legislation as soon as they could.

The vote early Wednesday afternoon by the House would forestall a default on the national debt. The Treasury Department had warned that the government would exhaust its authority to borrow to finance its existing obligations by the middle of February.

The bill, which Republican leaders unveiled last week, would suspend the debt limit through May 18 and require both the House and the Senate to produce and pass a budget resolution in the meanwhile, with a deadline of April 15. If either chamber fails to pass a budget, its pay would be put into escrow – “No Budget, No Pay” goes the newly-minted Republican slogan to describe this strategy.

J. Scott Applewhite / AP

Speaker of the House John Boehner, R-Ohio, and the House GOP leadership speak to reporters after a closed-door meeting on avoiding a potential debt crisis, at the Capitol in Washington, Tuesday, Jan. 22, 2013.

"It's time for Congress to get serious about this," Boehner said of the mounting national debt during a speech on the House floor ahead of the vote, "and this is the first step in an effort to bring real fiscal responsibility to Washington."

Republicans settled upon the strategy in the face of criticism from President Barack Obama that another round of brinksmanship over the debt limit would threaten catastrophe for the economy.

“To spare the middle class another knock-down, drag-out fight, we're going to proceed on this legislation and get it out of here as soon as we can,” Senate Majority Leader Harry Reid, D-Nev., said in a press conference on Wednesday.

The GOP’s new tack has the added benefit of forcing Senate Democrats to produce a formal budget, something the upper chamber has avoided for several years now. Democratic budget chief, Sen. Patty Murray, D-Wash., said Wednesday that Senate leaders had intended to produce a budget anyway, and would do so regardless of what the House bill requires.

Budgets are often political documents as much as a governing roadmap; Wisconsin Rep. Paul Ryan’s two budgets as Republican chairman of the House Budget Committee proposed a series of spending cuts and major changes to entitlement programs. But Democrats also managed to seize upon the most controversial elements of the Ryan budgets to use it to campaign against Republicans. If Senate Democrats author a budget, Republicans will doubtless seek to turn it against their opponents.

In the meanwhile, Republican leaders in the House have vowed to produce a budget document that would balance the U.S. budget within a decade. Ryan, the erstwhile GOP vice presidential nominee, said at a Wall Street Journal breakfast this morning that he expects this new strategy to yield “a big down payment on the debt crisis.”

House Republicans are discussing the prospect of a short-term extension in the nation's debt limit to avoid fault and give negotiations between lawmakers and the White House more time to succeed.

Wisconsin Rep. Paul Ryan, the House Budget Committee chairman and erstwhile GOP vice presidential candidate, told reporters at House Republicans' retreat that members were "discussing the virtue of a short term debt limit extension."

Ryan elaborated that the idea would be to raise the nation’s borrowing authority for a few months and tie the matter into discussions with the White House and Senate on the other fiscal issues facing the country, such as the automatic spending cuts associated with the sequester and how to fund the government in the next fiscal year.

The comment is a significant development because it suggests there is movement in the House GOP Conference to avoid the debt limit when it's scheduled to hit in February, and instead shift the political battle in their favor by transforming the debate into a fight over shutting down the government or offsetting $110 billion dollars in cuts to defense and domestic programs.

When asked by NBC News whether he believed the House GOP Conference was unified enough to not have a repeat of the fiscal cliff fiasco, when many Republican lawmakers were reluctant to support plans by the GOP leadership, Ryan said, “We want people to have clear view of what's coming so there are no surprises, that means setting expectations accordingly so we can move forward in a unified basis.”

Ryan spent the morning with House Ways and Means Chairman Dave Camp, R-Mich., briefing members about the upcoming “triple threat” of fiscal issues to be played out in Washington over the late winter and spring.  GOP aides tell NBC News the talks are part of an effort by the Republican leadership to gauge the mood of the conference as well as map out the best possible path for the party  in the next few months, so far they consider the response from members to be "positive."

The retreat is the House GOP’s annual occasion for members to talk to leadership, relax with their spouses and kids and also learn from communication professionals about to contour their message to fit the electorate. In light of the drubbing the GOP received amongst women and minorities in the 2012 election, the retreat will feature a seminar titled: “Coalitions-Discussion on Successful Communication with Minorities and Women.”

Senate Democratic leaders urged President Barack Obama to act to increase the nation's debt limit, even without congressional approval, in order to avoid a standoff with Republicans over the nation's borrowing authority.

The top four Democrats wrote Obama on Friday to urge him against allowing the debt ceiling becoming a bargaining chip with Republicans, who might threaten to vote against any increase in the debt limit without new spending cuts or entitlement reforms from the administration.

Senate Majority Leader Harry Reid, D-Nev., and three other Democrats wrote:

In the event that Republicans make good on their threat by failing to act, or by moving unilaterally to pass a debt limit extension only as part of unbalanced or unreasonable legislation, we believe you must be willing to take any lawful steps to ensure that America does not break its promises and trigger a global economic crisis -- without Congressional approval, if necessary.  

The White House has been loath to assert the type of broad executive privileges that would allow the president to unilaterally increase the amount of money the government is able to borrow in order to cover its obligations. Traditionally, approval of an increase in the debt ceiling has been the province of Congress.

But the 2011 fight over increasing the debt limit almost produced a default. Obama's agreement with Republicans at that time produced the spending cuts that make up the recent "fiscal cliff," which the president and lawmakers didn't fully solve. Obama warned after reaching an agreement with Republicans on taxes earlier this month that he wouldn't bargain over the debt limit, but some GOP lawmakers have begun to speak more openly about using that moment as a point of leverage.

It's not clear what authority Obama would invoke to unilaterally raise the debt ceiling. Popular theories argue he could invoke the 14th Amendment (which says the "validity of the public debt of the U.S. ... shall not be questioned"), invoke an obscure provision allowing the government to mint a $1 trillion coin to pay for the debt, or even issue I.O.U.s.

"We support your view that an extension of the debt limit is not something for which Democrats should have to negotiate," the Democratic leaders wrote. "At the same time, as a separate matter, we agree about the importance of developing a broad, bipartisan agreement on fiscal policy that strengthens our economy and reduces our long-term budget deficit."

The New York Times: “With his choice of Jacob J. Lew to be the secretary of Treasury, President Obama on Thursday will complete the transformation of his economic team from the big-name economists and financial firefighters hired four years ago to budget negotiators ready for the next fiscal fights in Congress. If confirmed by the Senate, the 57-year-old Mr. Lew — Mr. Obama’s current chief of staff and former budget director — would become the president’s second Treasury secretary, succeeding Timothy F. Geithner, who was the last remaining principal from the original economic team that took office at the height of the global crisis in January 2009.”

“The White House is working with its allies on a well-financed campaign in Washington and around the country to shift public opinion toward stricter gun laws and provide political cover to lawmakers who end up voting for an assault-weapons ban or other restrictions on firearms,” the Washington Post writes.

The Washington Post’s Greg Sargent: “The powerful Financial Services Roundtable — which is headed by former GOP presidential candidate Tim Pawlenty and represents nearly 100 of the largest financial service firms in the country — is set to increase pressure on Congress to raise the debt limit, warning that failure to do so will make the markets go ‘haywire.’ ‘We are in favor of raising it, and we will be encouraging policy makers to increase it,’ Scott Talbott, the senior vice president for public policy for the Financial Services Roundtable, told me today. He added that the group was gearing up to communicate the demand for action to Congress, an effort that could include sending letters to every member. ‘We will communicate with the entire Congress,’ he said.”

And in the New Republic, Noam Scheiber argues that Obama – potentially – could have gotten a better deal from Republicans in the fiscal-cliff talks. “Because it turns out Obama made a critical if underappreciated mistake in the final hours of the back and forth: sending Joe Biden to haggle with Senate Republican leader Mitch McConnell once McConnell's talks with his Democratic counterpart, Harry Reid, had broken down.”

More: “From my after-the-fact discussions with Democratic aides in the House and Senate leadership, it’s clear that Reid had a plan for resolving the cliff and considered the breakdown of his talks with McConnell very much a part of it. By involving Biden, Obama undercut Reid and signaled that he wanted a deal so badly he was unwilling to leave anything to chance, even when the odds overwhelmingly favored him. It suggested that even if Obama plays his cards exceedingly well in the run-up to the debt-limit showdown, he could still come away with a worse deal than he deserves because of his willingness to make concessions in the closing moments.”