Snowden famously claims that in his technical roles at NSA, he had access to the intelligence community's most tightly held secrets -- "full access to the rosters of everyone working at the NSA, the entire intelligence community, and undercover assets all around the world, the locations of every station we have, what their missions are and so forth" -- in addition to the power to shut down powerful collections systems over the course of several hours.

Snowden also claimed to be able to wiretap virtually anyone. "I, sitting at my desk, certainly had the authorities to wiretap anyone from you or your accountant to a federal judge to even the president if I had a personal email," he told the Guardian.

A former top lawyer at the NSA and CIA dismissed Snowden's claim as a "complete and utter" falsehood. "First of all it's illegal," Robert Deitz told the Los Angeles Times. "There is enormous oversight. They have keystroke auditing. There are, from time to time, cases in which some analyst is [angry] at his ex-wife and looks at the wrong thing and he is caught and fired," he said.

But even if he exaggerated or lied about how porous the system is, the nature of the counterintelligence investigation to determine both the extent of his knowledge and access, and, more tellingly, why he had access to some of the things he actually leaked, suggests he genuinely had more visibility than his clearance entitled him to have.

Former NSA inspector general Joel Brenner told the Post the investigation should center on why Snowden had, in his words, "access to such a startling range of information."

The nature of the information that has been disclosed in the press thus far points to the conclusion that Snowden leaked both materials an NSA system administrator might understandably have access to, and materials that should only have been available to handfuls of high-ranking agency officials.

"What was disclosed was not particular collection operations in detail, but more the kind of authorizing documents, and in one case a briefing ... describing in more general terms what the nature of the collection program was," former intelligence officer Paul Pillar told TPM. "It doesn't surprise me that someone who was supposed to be providing technical contract expertise [had access] to that kind of program."

In other words, as far as we know, based on what's been published, Snowden had visibility into the existence of programs and the legal authorizations for them, but not the data and metadata those programs are designed to collect.

But that doesn't account for two different facts. First, Snowden and reporters at both The Guardian and The Washington Post claim he leaked significantly more than what's been disclosed, and much of it will remain unpublished because it is simply too sensitive. Second, one of the documents he leaked -- a secret court order renewing the NSA's authority to collect huge amounts of phone company metadata -- probably isn't intended to be available to tech guys like Snowden.

A former NSA official told the Post that "maybe 30 or maybe 40" people at the entire agency should have had access to that document.

But it's possible that the intelligence community itself, which has erected strong incentives against allowing security failures and imposes huge penalties again leakers, grew too sanguine about the likelihood of a major leak, and thus allowed compartmenting walls to crumble.

"Companies like Booz [Allen Hamilton] know damn well, and that's why it's one of the biggest embarrassment's in the company's history, that they have to maintain secrecy for their government clients," Pillar said.

The latest data suggest a steadily improving employment situation, though don't bear any signs of accelerating growth.

The unemployment rate increased imperceptibly, from 7.5 to 7.6 percent, but that's notably not a reflection of inadequate job-creation, which on its own can sustain the current unemployment rate with fewer than 100,000 new payrolls a month.

Instead, the uptick is due to a welcome increase in the size of the labor force.

However, the report notes that industries and trades like manufacturing and construction (which is an indicator for the health of the housing sector) showed little or no change over the past month.

The most alarming news comes out of the public sector, which continues to be a drag on growth. Overall, government shed 3,000 jobs in May. However, this month the source of the drag came not from state and local job losses, but from the federal workforce, which shed 14,000 jobs, only 3,800 of which were "expected" postal service job losses. The rest of the federal government shed 9,400 jobs -- perhaps the first major indicator of the direct consequences of sequestration in a jobs report.

Local governments picked up the slack, adding 13,000 jobs in May, while state governments dropped 2,000 employees.

Taken together, though, the report indicates a very status quo labor market.

Even the revisions, which are subject to much less statistical uncertainty, hardly changed. March figures bounced up from 138,000 to 142,000, after an awful initial showing of 88,000; April figures dipped a bit more significantly from an initial count of 165,000 to 149,000.

That was July 2011, days before she, other congressional leaders, and President Obama struck a debt limit deal to cut $2 trillion in federal spending over 10 years. It was perhaps Democrats' darkest moment since Obama was first elected in 2008. But it was ironically consistent with Obama's broader goals: $4 trillion in total deficit reduction, split roughly two parts to one between spending cuts and higher taxes.

A lot's changed since then. The economy has slowly but steadily improved over the past two years -- enough that the country re-elected Obama. With that victory under his belt he was able to pocket a decent chunk of the revenue he'd hoped to raise by allowing the Bush tax cuts for top earners to expire. These developments combined to send the deficit into a rapid tumble.

But that's when the real wrangling in Congress over dollars spent and dollars collected stopped dead in its tracks. Republicans turned off the revenue spigot; Democrats refused to cut more spending absent further tax increases on wealthy Americans; sequestration was passively allowed to take effect; and the budget took a backseat on Capitol Hill to issues like immigration reform, gun control and investigations of the Obama administration.

So for the last several months, Democrats have been grappling with two challenges, at times at odds with one another: Dragging Republicans back into the budget fight; and attempting to resume that fight absent a false consensus that the final piece of the budget deal is only possible if it includes immediate and austere spending cuts and no revenue.

During that time, they've received two gifts -- one academic, and one all-too real -- that deeply damaged the intellectual foundations for the austerity movement.

Several weeks ago, economists discovered that a wildly influential paper by Harvard scholars Ken Rogoff and Carmen Reinhart, which implied U.S. debt might be approaching an economically perilous tipping point, contained critical errors. Indeed, it's likely that no such tipping point exists. At the same time, austerity policies in Europe continued (and still continue) to prove economically disastrous.

None of this has increased Democrats' appetite for stimulus. But at last it has them publicly questioning the wisdom of belt-tightening in general, and indiscriminate spending cuts in particular, during a fragile recovery.

Their challenge now is to amplify the fact that their broad approach (if not its particulars) has been vindicated, so that when the budget debate inevitably resumes this summer ahead of debt limit and government funding fights, the public is prepared to question GOP resistance.

"[W]e've made significant progress recently when it comes to our short and medium-term deficits," said Senate Budget Committee Chairman Patty Murray at a hearing this week dedicated to questioning the wisdom of austerity. "And now the focus should be on creating jobs, preserving our fragile recovery, long-term deficit reduction, and setting the conditions for economic growth built from the middle out."

Republicans are sticking to a path of least resistance, declining to confront the fact that their position -- that sequestration is preferable to a more gradual mix of spending cuts and higher taxes -- has been called into question, and pushing off legislative debate in hopes of conflating the budget and debt limit fights.

Democrats are preparing for that fight by undermining the Republican strategy going in.

"What we can do with all this new information is make the case that we want to replace sequestration," said a senior Senate Democratic aide. "[W]e're connecting sequestration to austerity [to] reduce the case they've made for cutting spending in the short term."

To that end, Democrats ironically take comfort in the fact that Republicans are holding a hard line on annual spending for the coming fiscal year. The GOP position is that spending must not exceed sequestration levels, but that money should be funneled from already-struggling domestic program into security spending. Democrats -- up to and including President Obama -- insist that they'll oppose attempts to plus up GOP spending priorities at the expense of the rest of the government functions. But they're happy to entertain the notion of restoring spending to the Pentagon and other agencies... if domestic programs get the same treat.

They'll have to relent on austerity altogether, the aide said, "If they want to have their priorities especially on the defense side protected."

Van Hollen still says that's how things are likely to play out.

"Republicans are going to have to decide if they want these deep cuts to defense to take place," he said. "I think you're going to see more attention to this in the coming months for a couple reasons: Just a couple days ago, over 600,000 civilian defense furlough notices went out. Just last week ... the superintendent of schools at Ft. Bragg announced that teachers for the schools on base are going to be furloughed for five days this fall. These are the kids of servicemen and women who are putting their lives at risk in service of the country are going to have kids out of school for five days this fall because of the sequester.... [S]o they're just beginning to see the impact of the sequester."

If they're right, the question is whether lawmakers will return to negotiations over a deficit-reducing "grand bargain" or turn to more modest measures.

The Center for American Progress, an influential, White House-aligned think tank, says Democrats ought to avoid getting snookered into deficit negotiations all over again, unless Republicans abruptly moderate their demands.

"We think that we've learned that the last three years have shown if nothing else that there's no way to get a big deal right now," said Michael Linden, managing director for economic policy at CAP, at a reporter roundtable Thursday morning. "Republicans just simply aren't -- Republicans in Congress I should say -- don't seem willing to make the compromises necessary to achieve a large deal.... To that end we think that we should keep it small, keep it manageable."

To that end, they've released a new report encouraging law and policy makers to update their thinking about the relative imperatives of immediate job creation, and near- and longer-term deficit reduction; and to pursue a short-term strategy of investment and partially paying down sequestration.

"We think that we've learned that the last three years have shown if nothing else that there's no way to get a big deal right now," said Michael Linden, managing director for economic policy at CAP, at a reporter roundtable Thursday morning. "Republicans just simply aren't -- Republicans in Congress I should say -- don't seem willing to make the compromises necessary to achieve a large deal.... To that end we think that we should keep it small, keep it manageable. So we offer a plan that would replace the sequester for three years."

Beyond the particulars, the report reflects a recognition by the liberal establishment that the White House and congressional Democrats have undertaken a flawed approach to achieving medium-term deficit reduction, and ought to abandon their strategy of horse trading tax increases for entitlement cuts with Republicans. Obama's most recent budget offer included a significant Social Security benefit cut. Republicans rejected it, suggesting they'd only be satisfied with more draconian cuts, but have refused to identify those cuts themselves.

Since then Obama's efforts to create a working group of Democrats and Republicans to round out the "grand bargain," and Democratic efforts to see the congressional budget process to conclusion, have fizzled.

"The pursuit of the grand bargain itself has had negative consequences," Linden said.

"The majority leader has twice committed on the Senate floor not to use the nuclear option," McConnell said on the floor two weeks ago. "These were not conditional commitments. ... The majority leader needs to keep his commitments."

And then again this Tuesday, at his weekly briefing with reporters: "Commitments were made. And on behalf on Senate Republicans, I intend to ask the majority leader every single day, 'Is your word good, do you intend to keep your word?'"

Effectively, McConnell is trying to shame Reid into dropping a threat to invoke the "nuclear option" if Republicans block key administration nominees. But Reid handed him that ammunition over two years ago.

But in January 2011, Reid's remarks had a "Read. My. Lips." quality to them.

"The minority leader and I have discussed this issue on numerous occasions," Reid said on the Senate floor, according to the congressional record. "I know that there is a strong interest in rules changes among many in my caucus. In fact, I would support many of these changes through regular order. But I agree that the proper way to change Senate rules is through the procedures established in those rules, and I will oppose any effort in this Congress or the next to change the Senate's rules other than through the regular order."

Reid spokesman Adam Jentleson says the remarks were implicitly conditioned on an understanding that Republicans wouldn't block nominees except under extraordinary circumstances.

"You can't credit McConnell's argument on its face," he said. "This agreement and the one from January were both two-way streets -- Republicans have a responsibility to honor their commitments, and they haven't."

Months after the Democratic push for filibuster reform failed in January 2011, Reid noted on several occasions that the agreement he had reached with McConnell had fallen apart, and that he'd erred by not changing the rules at the beginning of the 112th Congress. And since that time he's been pretty clear that he'd only resort to changing the rules by majority vote under extraordinary circumstances -- such as if Republicans were to serially block key nominees.

But that's not the impression Reid left when he initially made the comments two and a half years ago.

On Tuesday afternoon the House passed a measure directing House appropriators, in the absence of a budget agreement with the Senate, to adopt spending levels in the Republican budget. That blueprint calls for enormous cuts to spending on everything from science research to education to health care, in order to rescue the Defense Department and other politically favored agencies from the ravages of sequestration.

The procedural move is technical, and it stems among other things from Republicans' decision to abandon the very budget process they've demanded for the past four years. But it reflects their desire to jam Democrats and President Obama with spending bills that funnel billions of dollars out of domestic priorities into the Pentagon and other security programs, at the risk of a government shutdown

After the House and Senate passed separate budgets this spring -- something Republicans have been demanding for years -- Democrats undertook a concerted effort to drag the GOP through formal negotiations until Congress reached a consensus on taxing and spending that ended crisis governing for the foreseeable future.

Republicans weren't having it. They correctly identified the political perils they'd face by seeing regular order" to its conclusion. So for the past several weeks they've been stalling. They've refused to appoint negotiators in the House and have blocked Democratic efforts to appoint negotiators in the Senate

Without a negotiated budget, though, congressional appropriators lack the direction they need to allocate funds to accounts across the government. Tuesday's move sets the spending levels in the Republican budget as the benchmark.

"The overall spending level is at the sequester levels," Van Hollen added. "The veterans bill is going to be funded at pre-sequester levels. That's going to be funding at a healthy level as if sequestration did not exist. And they're going to do that for defense.... [I]t means you're cutting other parts of the budget below sequester level."

To take one example, this approach would require cutting the second largest appropriations bill -- the so-called Labor/HHS bill -- by $34 billion. Moreover, House Republicans call for shifting so much money from domestic spending into security spending that it would violate the terms of the Budget Control Act (better known as the debt limit deal).

The Obama administration has threatened to veto this bill unless it's ultimately included in a broader effort to set the rest of the budget right. In other words, no special treatment for Veterans Affairs or the Pentagon, particularly if it comes at the expense of other spending priorities.

"Unless this bill passes the Congress in the context of an overall budget framework that supports our recovery and enables sufficient investments in education, infrastructure, innovation and national security for our economy to compete in the future, the President's senior advisors would recommend that he veto H.R. 2216 and any other legislation that implements the House Republican Budget framework," the White House said this week.

Van Hollen supports the White House's strategy -- "ultimately there's not going to be an agreement on these levels, which is why the White House issued its veto threat" -- but somewhat contradictorily predicts the bill will pass with significant Democratic support, including his own.

And ironically, strong bipartisan showings for individual GOP-backed spending bills -- for veterans, the Pentagon, etc. -- will make it harder for Obama to sustain his veto threats.

"The way I interpret his threat is he also supports the veterans bill at that level but at the end of the day Congress better send me appropriations bills that meet all our needs, including our kids' education, or I'm going to veto them," he explained. In other words the bill is suitable on the merits, and in isolation, but will be rightly vetoed if Republicans don't at least make similar accommodations for other spending priorities.

That's not likely to happen. And Van Hollen acknowledges that will complicate things for Democrats as the Sept. 30 government shutdown deadline approaches.

"It's important that the Senate make sure these bills don't come out individually in the order you just talked about," he said.

It had nothing to do with truly imperiled nominees like Rich Cordray over at the Consumer Financial Protection Bureau or Tom Perez at the Department of Labor. But it nonetheless reveals a great deal about power dynamics between the leaders as the Senate builds toward a showdown over key confirmations -- and perhaps another effort to change the Senate's filibuster rules.

So this week, Reid used the Senate rules to provoke a confrontation: Technically he filed cloture on Srinivasan's nomination, guaranteeing him at least a test vote this week. More meaningfully, he forced McConnell to choose between sustaining a filibuster against Srinivasan through early June (a move that would have helped Reid build his case for changing the rules this summer) and agreeing to a confirmation vote now (effectively caving).

McConnell caved Thursday morning on the Senate floor. A small cave. But a cave nonetheless. Srinivasan will be confirmed Thursday afternoon. But the "cave" is only a small part of the story.

"The effort to justify breaking the rules just fell apart," McConnell spokesman Don Stewart told TPM.

That's probably overstating things a bit. But it points to the fact that McConnell is actively trying to undermine Reid's efforts to present Republicans with a Sophie's choice between dropping their filibuster threats against nominees they oppose and standing by as Democrats do away with the filibuster on presidential nominees altogether.

As we reported Wednesday, Reid is structuring confirmation votes on existing nominees like Cordray and Perez to either break GOP filibusters or build a permission structure for his members to support a controversial rules change if their nominations fail. McConnell's move today suggests he believes Reid's case will be persuasive, if only to Democrats, and doesn't want to enable it.

Srinivasan is an easy pawn to forfeit in this game, but the fact that McConnell recognizes Reid's strategy, and its potential effectiveness, means he might have to concede more tactically significant pieces in the future.

Plans change. Cordray will now most likely get his chance after immigration reform legislation clears the Senate. And not because Reid is giving up on Cordray's nomination, but because he wants to turn Cordray and a handful of other nominees into a test of the GOP's vows to filibuster top Obama picks, including two designated cabinet secretaries.

The move serves two purposes: First, it removes one of the largest pretexts Republicans will have to walk away from immigration reform. Second, it puts Republicans on the spot in an exquisite -- and in Reid's mind necessary -- way, thus providing the nominees their best chance at confirmation, and leaving Democrats little choice, if the GOP blocks them, but to change the rules to immunize executive and judicial nominees from filibuster.

"The more likely scenario is that cloture is filed on some or all of them, because that is more substantive than a unanimous consent request," says a senior Democratic aide. "But that determination hasn't been made yet."

Lumping Cordray in with the rest will result in a more dramatic demonstration, top Democrats believe, than trickling the nominees out slowly.

That effectively puts Reid and Minority Leader Mitch McConnell on a collision course. If McConnell caves or works out an agreement with Reid, then the nuclear option will become inoperative. But if he doesn't and these confirmation votes fail, then Reid will either have to admit defeat or do ... something. In that sense he's essentially building a "permission structure" for himself and his caucus to do something about the rules in the event that Republicans make good on their threats.

"[Sandy aid] was totally different," Inhofe said on MSNBC Tuesday morning. "They were getting things, for instance, that was supposed to be in New Jersey. They had things in the Virgin Islands. They were fixing roads there, they were putting roofs on houses in Washington, D.C. Everybody was getting in and exploiting the tragedy that took place. That won't happen in Oklahoma."

A total of 31 Senate Republicans opposed the final Sandy relief bill earlier this year, citing small appropriations to repair damages and address concerns outside the hardest hit areas in New York and New Jersey, as well as the fact that the funds weren't offset, and because it contained $16 billion to be distributed as Community Development Block Grants.

Watch Inhofe on MSNBC below.

"We are aware of Mr. Santilli's comments and will take the appropriate follow up action," Edwin M. Donovan, a Secret Service spokesperson, told TPM on Monday. "He certainly has a right to free speech, but the Secret Service has a right and an obligation to determine what a person's intent is when making comments like this."

'Miss Hillary Clinton needs to be convicted, she needs to be tried, convicted and shot in the vagina," he said. "I wanna pull the trigger. That 'C U Next Tuesday' has killed human beings that are in our ranks of our service. I want to remind you that in Benghazi, Miss Hillary 'the fricken' biggest vagina on the face of the planet' told troops to stand down and to not go in and interfere with the operation that they set up because they're moving arms; Barack Obama is moving drugs through the CIA out of Afghanistan and Barack Obama needs to be tried, convicted, and shot for crimes against the United States of America."

The website Hypervocal has posted the audio.

In walking members and their staffs through the internal emails, the administration provided extensive explanations of how the talking points evolved, sources in attendance tell TPM. The extent of the information provided in the classified briefings calls into further question how a summary of the emails that was leaked to ABC News overstated the White House's role in crafting them. An intelligence official who participated in the briefings and spoke to TPM says that the discrenpacy between the emails he briefed Congress about and the ABC News report "speak for itself."

The ABC report was based on notes taken by a still-unnamed source, presumably a Republican, in attendance at one of two briefings the administration held for members and senior staffers of the Senate and House intelligence committees and top leadership offices in February and March of this year. The ABC report contained a great deal of the information the White House would ultimately reveal itself this week when it released all of the inter- and intra-agency email communication that ultimately resulted in the talking points Susan Rice used in a now-infamous series of appearances on network news shows on the Sunday after the attack.

But it got one big part about the White House's role wrong:

In an email dated 9/14/12 at 9:34 p.m. -- three days after the attack and two days before Ambassador Rice appeared on the Sunday shows -- Deputy National Security Advisor Ben Rhodes wrote an email saying the State Department's concerns needed to be addressed. "We must make sure that the talking points reflect all agency equities, including those of the State Department, and we don't want to undermine the FBI investigation. We thus will work through the talking points tomorrow morning at the Deputies Committee meeting."

It turns out that's not what the email said. To quiet the growing furor over the idea that the White House had thumbed the scale on the State Department's behalf, a government official subsequently leaked to CNN the full text of Rhodes' message, which was assiduously neutral about each relevant agency's concerns.

But discussions with several people in attendance at or with knowledge of the two congressional briefings suggest that members and staffers were left with the opposite impression -- that the White House had remained neutral in the dispute between the State Department and the CIA -- and that after a thorough run-through, they were given ample time to take notes not just about the briefing itself, but in theory to transcribe key emails verbatim.

"When I say they were allowed to have the documents for as long as they wanted, they were allowed to take notes for as long as they wanted as well," the intelligence official said.

The discrepancy between the documents ABC was provided and the official records has led White House officials, congressional aides, and outside observers to the conclusion that a GOP member or staffer falsified notes or tendentiously interpreted administration emails -- and then leaked them -- to create the impression that the White House had sided with the State Department in an intra-agency dispute to protect President Obama from political blowback.

"I got a lot of questions probing in a lot areas," the intelligence official said. "Truthfully I cannot recall whether I specifically got any questions asking about the White House. All the questions I got were not sort of tendentious questions but they were asking facts, to understand what went on."

After those briefings, the Benghazi controversy quieted down for several weeks -- a tellingly long silence given how damning the emails supposedly were -- until ABC's report, including its characterization of the White House's involvement, exploded in the press late last week. Karl, who downplayed the discrepancies between the summaries he relied on and the actual emails, was not immediately available for comment for this story.

"I wouldn't go into what the members said in the meeting," the intelligence official said. "The relationship between what the documents show and what the report said sort of speak for itself."

A congressional source who attended one of the two meetings had a similar recollection.

"I don't recall a single member asking a single question or making a single statement suggesting the White House played anything other than an appropriate role in resolving the disagreement over the talking points," the source said.

On top of that, the source added that the CIA had acknowledged on other occasions making all of the major changes to the talking points itself, irrespective of the State Department's concerns.

"The CIA itself and then the ODNI [Office of the Director of National Intelligence] who walked us through the emails all made clear that every one of the changes with regard to the involvement the naming of al Qaeda and Ansar al Sharia were made by the CIA," the source added. "Petraeus and Morell were saying that last year.... They were extremely forthcoming about that from the beginning. That piece of knowledge was repeated so many times in so many different briefings it would be impossible for me to believe that anybody left with the impression that anyone other than the CIA made the changes."

This source draws a connection between the notes quoted in the ABC report, and an April report from House Republicans which attributes the changes to the State Department.

"The House Republican report so distorted its coverage of the talking points changes. ... I see no reason to believe it wouldn't be the same thing with regard to the Ben Rhodes email."

A senior House Republican aide with knowledge of the briefing but who denies being ABC's source still largely backs the GOP characterization of the emails, and says any mischaracterizations were unintentional, and the result of poor communication.

"The idea anyone was nefariously putting words in people's mouths just isn't based in reality," the aide emailed. "This ALL goes back to a disconnect between quoting summaries vs quoting verbatims. And, again, ABC acknowledges they weren't clear enough in their first story about what they were told they had been given."

That explanation doesn't cut it for Democrats.

"I think they thought that this stuff would never be declassified or something," said one House source with knowledge of the briefing. "Some of them could've taken really bad notes, but to me this looks more intentional."

To the congressional source in attendance, it's all part of the GOP obsession with Benghazi. "I know for a fact that some of the Republican critics -- they are true believers. .... They may not have found the smoking gun yet that convinces everyone else there was a coverup, but there's no question in their mind that it's there somewhere, evidence notwithstanding."

IRS will administer key ACA revenue and subsidy provisions, and a major scandal at the agency offers the GOP a unique opportunity to question the wisdom of expanding its authority.

But some conservatives hope to draw a less direct, but in theory much more consequential, connection between Obamacare and IRS malfeasance -- one which they hope will result in denial of benefits to millions of uninsured taxpayers, and perhaps the unwinding of the entire law.

Enter the IRS, which interpreted that language in its regulation-writing process as meaning that those people will in fact be eligible for insurance subsidies in every state, regardless of whether the exchange is state- or Washington-run.

Conservatives, and even some GOP lawmakers, contend the IRS's interpretation was unlawful -- and now they want to yoke their narrow reading of the law to the unrelated political non-profit controversy.

"The IRS has announced that it will violate the text of the law and issue health insurance subsidies through federal exchanges, something Congress did not authorize," Senate Minority Whip John Cornyn (R-TX) said in floor remarks this week. "The law clearly states that these subsidies are not available to the federal exchange but only to the state-based exchanges. It's the case that the President's health care law will dramatically expand the power of the Internal Revenue Service because the agency is responsible for implementing so much of Obamacare's most important provisions. Well, given what we've learned about IRS malfeasance, does that really sound like a good idea, to give them more responsibility, to hire more agents before we get to the bottom of the present scandal?"

The conservative hue and cry for pursuing this approach to undermining Obamacare is much quieter than the one that culminated in a landmark Supreme Court decision to uphold the law last year. That reflects a combination of factors: the argument's weaker, the politics are much less straightforward, the complaint is aimed at benefits that nobody's received yet. The IRS scandal could change that dynamic.

And though reform supporters don't want to see this idea take flight in the media the way the novel theories underlying previous ACA challenges did, they don't believe it's persuasive enough to pose much of a danger to the law.

"If and when this gets to court, courts are going to look at this and say, well, this isn't a very well-worded statute, but when you look at it as a whole, it's clear that it intends federal exchanges to issue premium tax credits," says Timothy Jost, a law professor at Washington and Lee University, and an ACA supporter.

Ironically, the conservatives who devised this argument cite a paper Jost wrote in 2009 to bolster their own claims. In it, he muses among many other things that Congress could theoretically deny insurance subsidies to federal exchanges on purpose, to incentivize states to erect them on their own. The implication is that Congress may have adopted Jost's idea intentionally.

The legislative history of the ACA, along with its interpretation by government agencies, official analyses by the Congressional Budget Office, and the broad consensus of the members of Congress who wrote the law belies this notion. (Jost never endorsed the idea, either, and called the notion that he inspired or promoted it "weak.")

The Congressional Research Service has looked at this issue closely, too. Its conclusion suggests that unless courts read the portion of the law at issue in isolation, and precisely as the laws opponents characterize it, then legal challengers will have a hard time denying subsidies to individuals via federal exchanges. The IRS' interpretation of the statute would stand. And even that determination would probably have to wait until 2015, before which challengers will have a hard time demonstrating standing.

"By 2015, somebody will have standing to raise it, then I think the question will be are the courts really prepared to rescind tax credits for millions of Americans," Jost said.

On top of all that, if individuals in states with federal exchanges are ultimately denied insurance subsidies, their lawmakers -- most of them red-state lawmakers -- would find themselves under immense pressure to fix the law, and quickly.

Why? Jost explains, "if a court would ever hold that the federal exchanges couldn't issue premium tax credits, it would be a serious problem, because it would deprive millions of Americans of tax breaks and insurance, it would also weaken the individual mandate."

So it's an unlikely outcome that's also a long way off. But the ideas adherents have been waiting for a chance to take it mainstream. The IRS scandal provides it to them.

At a reporter roundtable in his Capitol Hill suite Wednesday, Reid claimed responsibility for Democrats' decision to provide the FAA -- and only the FAA -- unique flexibility under sequestration to move money between accounts, and thus to avoid scheduled tower closures and controller furloughs causing major travel delays that were expected to drag on for months.

"I take all the blame," Reid acknowledged.

"I think the next thing I see that's going to ask for, 'let's just take care of this,' is going to be the Pentagon," Reid said. "They're asking already for more money for a number of different things. I think the time has come that we -- if something comes up in the military, that we have to understand there are a lot of people out there who don't have lobbyists, who don't have people up here to advocate for them."

"We've got the 70,000 kids on head start, meals on wheels, NIH ... we have all kinds of issues that sequestration is hurting," Reid said. "I'm not going to apologize for what we've done with air-traffic control, but hopefully in the future we're going to stop this."

This is the first time since the FAA bill passed that Reid has claimed that he will not address sequestration in a piecemeal fashion. He made similar public assurances before travel delays became an issue, but then ultimately agreed to grease legislation to fix that problem in isolation.

Responding to pressure from reporters and Republicans on Capitol Hill, the administration released what they claim are all emails internal to, and between, relevant government agencies drawing up the talking points that Susan Rice used when appearing on Sunday talk shows a few days after the attacks that left four Americans, including U.S. Ambassador to Libya Christopher Stevens, dead. Those emails are characteristic of the laborious bureaucratic process required to finalize the talking points, but do reflect disagreements between senior officials in agencies outside the White House over what information the talking points should contain.

That squabbling -- which appear to reflect at least in part the two agencies' desires to insulate themselves from blame for the attacks -- is the only remaining aspect of the controversy, perpetuated by Republicans and conservatives, over the administration's private deliberations and public communications in the days after the attack.

Notably, the officials at the briefing sought to downplay that tension as well. The final talking points, they noted, were edited most thoroughly by CIA Deputy Director Michael Morrell, and reflect the modifications the State Department was seeking.

But Morrell's modifications reflected his own disagreements with early drafts, independent of State Department's similar objections, the officials stressed in the briefing, suggesting the rift between State and CIA was less severe than first believed.

That view is backed, in part, by sign-off from Morrell's top terror analyst, who in one email responded to Morrell's edits, "They are fine with me. But, pretty sure HPSCI [the House Permanent Select Committee On Intelligence] won't like them. :-)"

Then-CIA Director David Petraeus did raise objections to the final drafts, reflecting both his desire that the talking points contain information about CIA warnings regarding the security situation in the region, and his belief that HSPCI members would not be satisfied with them.

"No mention of the cable to Cairo, either? Frankly, I'd just as soon not use this, then... NSS's call, to be sure; however, this is certainly not what Vice Chairman Ruppersberger was hoping to get for unclas[sified] use. Regardless, thx for the great work."

NSS refers to the White House National Security Staff. Rep. Dutch Ruppersberger (D-MD) is the top Democrat on the House Permanent Select Committee On Intelligence.

The emails do not make clear why HSPCI members, including Ruppersberger, would be unhappy with the talking points, but they suggest that it was because the final version of the talking points lacked sufficient detail about the incident.

"I think most everyone knows if [Hillary Clinton] wants to run for President, she's going to get that nomination," he told a small group of reporters during a roundtable discussion in his Capitol suite Wednesday afternoon.

"To keep going over this thing, day after day, on things that have been in the public record for months and months, it's obvious that it's an attempt to embarrass President Obama and to embarrass Hillary Clinton," Reid said, before assessing the Democratic primary field.

Reid acknowledged that the Benghazi attacks raise legitimate national security questions -- just not the ones Republicans are hyper-focused on.

"The Speaker says he's obsessed with this and it appears that's the case," Reid snarked. "There are terrorists -- really that's a new part of the world that we have to understand. There are terrorists who want to do us harm. You, your family, for no reason that we can appreciate or comprehend. That's what we should be doing, is spending our time determining how we're going to handle the terrorists, whether that's economic means to make people feel better or whether it's more security-directed stuff."

Instead, Republicans have harnessed themselves to the allegation that the Obama administration wanted to cover up the fact that there had been a terrorist attack -- a contention that feeds a much uglier conspiracy theory.

"Republicans are doing everything they can to ratchet back more security for embassies," Reid said. "This is just a sideshow, trying to embarrass Obama and Clinton."

To that end, he'll hold a vote on Cordray's nomination next week.

Reid's decision to eschew significant reforms to Senate filibuster rules at the beginning of the current Congress -- and his continuing reluctance to revisit those rules despite recent filibusters of cabinet nominees -- angers allies both on and off of Capitol Hill.

But he continues to approach the issue cautiously.

"I'm not going to do anything now, precipitously," he said. "But I'm looking at this very closely.... We're going to fill that job. Cordray is there now. He's going to get a vote."

Reid wasn't able to explain why he believes (or claims to believe) Cordray will ultimately be confirmed. But he alluded to the possibility that he may pursue a rules change mid-session.

"Whether it's Jeb Bush or Hillary Clinton that's the next president, I don't think they should have to go through what we've gone through here," Reid said. "People better watch."

Conservatives and GOP members of Congress issued dire warnings shortly after the news broke. But the fact that the revelation came less than a week before the House of Representatives votes (again) to repeal Obamacare probably hastened a legislative linkage.

And here it is.

"I believe we need to address IRS funding in the health care law now, which may mean calling for a temporary suspension until it is clearer where this funding will go," Heller wrote. "I want you to know I intend to introduce legislation this week to suspend IRS funding for new agents enforcing the health care law until Congress sees an improvement. I am hoping this legislation is unnecessary and that we may work together to find a solution to this problem together."

The letter is a bit muddled. It alludes to President Obama's budget and the ACA itself, without drawing distinctions between the two. Obama's budget calls for higher IRS spending ahead of ACA implementation, but has no binding force.

It's also unclear whether Heller proposes to (perhaps temporarily) withhold money that's already been appropriated to the IRS, or to rescind its authority to spend current and future funds to implement and administer the law.

A Heller spokesperson did not immediately respond to a request for clarification.

At his weekly briefing with reporters Tuesday, House Minority Whip Steny Hoyer (D-MD) addressed the conflation directly. "I don't think that this [IRS controversy] is anything that is going to undermine the IRS's credibility vis-a-vis the implementation of the Affordable Care Act."

Perhaps. But it's already refueling the GOP's ongoing political drive to repeal the law in full or in part.

And it could draw more attention to brewing conservative efforts to rescind ACA insurance subsidies to beneficiaries in states that will have federally-run exchanges. Senate Minority Whip John Cornyn (R-TX) tried on Tuesday to tie that more obscure issue to the unfolding non-profit scandal.

"The IRS has announced that it will violate the text of the law and issue health insurance subsidies through federal exchanges, something Congress did not authorize," Cornyn said remarks on the floor. "The law clearly states that these subsidies are not available to the federal exchange but only to the state-based-exchanges. It's the case that the President's health care law will dramatically expand the power of the Internal Revenue Service because the agency is responsible for implementing so much of Obamacare's most important provisions. Well, given what we've learned about IRS malfeasance, does that really sound like a good idea, to give them more responsibility, to hire more agents before we get to the bottom of the present scandal?"

You can read Heller's letter in full below.

At his weekly Capitol briefing Thursday, Boehner faced questions about two aging and increasingly questionable elements of the GOP's legislative strategy: repeated votes to repeal the Affordable Care Act and continued efforts to extract partisan concessions from Democrats in exchange for increasing the debt ceiling.

In both cases, Boehner acknowledged that the conservative wing of the House is driving the agenda.

And the debt ceiling? Same basic story.

"Our conversations have begun," he said. "We're going to have a big conversation with our members next week to talk about a way forward -- what do our members believe is necessary to allow them to vote yes on increasing the debt limit?"

It's yet more evidence that the party's national and legislative strategies are driven by rank and file conservatives, not party leadership.

To his credit, Boehner tried to nudge the GOP conference away from an obsession with the Boehner rule -- the idea that debt limit increases must be paired with spending cuts of equal measure -- and toward naming other party priorities as its ransom.

But ironically that illustrates the fact that the rank and file is driving a strategy that was of questionable usefulness when the GOP adopted it the first time, and lost the rest after President Obama won re-election.

"[D]ealing with the long-term structural spending problem we have frankly is at the core of it. But we also know we can't cut our way to prosperity," Boehner said, perhaps unintentionally repeating one of Democrats' most common budget talking points. "We need real economic growth. And that's why you continue to hear a lot of discussion about tax reform, regulatory reform, that would help us produce economic growth here in our country."

They made sure as many as people as possible saw him condescend to Sen. Dianne Feinstein (D-CA), as she tried to advance an assault weapons ban in the wake of the Sandy Hook massacre. When he launched a failed filibuster of more modest gun legislation the public relations backlash (nurtured by Democrats) made him persona non grata with some members of his own party.

Among Democrats, he is one of the most widely cited opponents of immigration reform.

And this week no less a powerbroker than Senate Majority Leader Harry Reid (D-NV) called Cruz a "schoolyard bully" and the "very junior senator from Texas," after Cruz blocked further formal budget negotiations absent a pre-emptive Democratic surrender.

Yup, Democrats can't stand Ted Cruz. Except that they also kind of love him.

"I think the buzz around Sen. Cruz, both on the Senate floor and over the airwaves, represents a sincere effort on the part of Democrats to highlight the true, new face of the GOP -- or at least its conservative wing (which is pretty much the whole bird these days)," Democratic strategist Paul Begala told TPM by email. "Just as Joe McCarthy embodied the paranoid extreme right in the 50s, Ted Cruz does so today. The difference is, in the 1950s mainstream Republicans like Pres. Eisenhower and Sen. Prescott Bush stood up to McCarthy, today's Republicans (with the notable and admirable exception of John McCain) are so cowed by Cruz you can almost hear them moo. And so it falls to Democrats to shine a light on him."

The dynamic resembles Democratic efforts to increase the stature of unelectable GOP candidates from Sharron Angle to Christine O'Donnell to Mitt Romney's many would-be rivals. In 2011, Nancy Pelosi roiled the Republican presidential primary when she told TPM, "I like Barney Frank's quote the best, where he said 'I never thought I'd live such a good life that I would see Newt Gingrich be the nominee of the Republican Party,'" and alluded to a rich field of material Democrats would use against him.

Nobody was happier with her comments than Gingrich himself.

Cruz and top Democrats enjoy a similar symbiosis. When Reid insults him, and when he gets under Feinstein's skin, that helps him with the GOP base. When Democratic strategist James Carville goes on national television to acknowledge Cruz's talents and kinda-sorta suggest Democrats would be scared to run against him, we recognize that as tried-and-true but harmless ratfucking, to use the technical term. Cruz sees it as an opportunity to tout his conservative bona fides.

Everyone wins -- except the rest of the GOP.

"It is fair to say that there's a general sense that the more Ted Cruz and Rand Paul are the face of the Republican Party, the worse it is for the Republican brand and the better it is for Democrats," said a senior Democratic Senate aide. "I think most [Republicans] get it, but I don't think there's anything they can do about it without risking a huge backlash given how beloved those guys are by the base. No one is stepping up to say, we Republicans need to come to our senses and do the right thing to preserve our brand. Everybody is just trying to survive their own race, and hoping some savior will come along and rebrand their party. Enter Eric Cantor ... aaaand, exit Eric Cantor."

Reached for comment for this story, a Cruz spokesperson declined to comment, except to say, "The senator's focused on his work for Texans in the Senate."