Bayh: Debt ceiling vote will be TARP redux

“The debt ceiling cannot be avoided,” he said, but “nobody will want to vote for it.”

He said House Democrats will lay responsibility at the feet of the GOP because that party now has the majority.

After the markets are roiled, both sides will sit down and find a way to raise the debt ceiling, Bayh predicted.

At the same event, Austan Goolsbee, chairman of the Council of Economic Advisers declined to comment on statements by House Democrats that it is not their responsibility to raise the ceiling.

Goolsbee has publicly declared that not raising the debt ceiling would be a product of “insanity.”

Bayh said House Republicans, as the 2012 elections approach, will become more motivated to compromise with the administration in order to show voters they can govern. Because of this, the GOP will likely look to forge a budget-cutting deal with President Obama.

“If they have nothing to show for it, they will be the new rascals that will be thrown out,” he said.

On the other hand, Bayh said he is pessimistic anything will get through the Senate. In 2012, Republicans will have a strong chance of taking back the Senate, and Senate Minority Leader Mitch McConnellAddison (Mitch) Mitchell McConnellHarry Reid reacts to Boehner book excerpt: 'We didn't mince words' Democrats see opportunity in GOP feud with business Biden resists calls to give hard-hit states more vaccines than others MORE will be motivated to continue to deny Obama anything that can be painted as a victory.

“Being on the Hill for the last 12 years has taught me to be skeptical,” the former senator said.