Wall Street has spoken. President Obama gets wicked. McConnell folds. And now we have total capitulation:
“We’re certainly not going to send a signal to the markets and to the American people that default is an option,” McConnell told reporters. “What we’re not going to be a party to in the Senate, I’m pretty confident, is default.”
The message to Cantor is simple: You'd better find a way to get right with Obama because if you want to default on the debt, you've got no friends over here.
Not that Cantor actually wants to default. He's as bought and paid for by Wall Street as the rest of em. The problem that he now faces is that he made certain promises to the tea party base and now he can't find a way to break them and save face. But break them he will.
As we all have known for a long time, poor people on Medicaid are going to get the axe. Both parties and the White House have made it completely clear that poor people are getting too much healthcare. So that's getting cut...the fix is in. Some sort of spending cuts are going to be a part of this because the President has to burnish his "moderate" credentials with independent voters. I'll be writing on this topic soon. Why we are cutting spending in the middle of a recession and the actual policy implications of a political victory for the President are another matter.
Trust and believe, after this magnificent kabuki performance is over, it will be jobs and the economy right back at #1.
On a tactical note, it is time for Democrats to begin the endgame on this thing by moving towards a compromise that has nothing but a clean debt ceiling increase. That, as i see it, is the best outcome of a really stupid set of choices, none of which is going to put a single soul back to work or save anyone's home. Lets make sure we have this in perspective...while we will defeat the GOP's effort to dismantle what's left of the New Deal, the outcome of this battle wont do a goddam thing for the middle class and the poor. Make no mistake, we're still losing ground and they'll be back. They're in it for the long haul. And for the first time, we have a Democratic president who has put the New Deal on the table. Maybe one day we will start playing offense for the middle class, but don't expect it any time soon.
Finally, for you 11th dimensional chess fans: The idea that this entire ordeal was some sort of master strategy by Obama just fails the laught test, the cry test, the ridiculous test.You'd have us believe the following:
To get to a clean debt bill:
1. Accept the idea that deficit negotiations and debt ceiling increase are linked, as Republicans demanded. Also accept that said negotiations will take place outside of the public eye and without political grandstanding.
2. In said negotiations, respond to a Republican demand for 100-0 ratio of spending cuts to tax increases with a 83-17 offer on approximately $2 trillion in deficit reduction.
3. Knowing that this will be rejected, then offer an even bigger deal with a 75-25 ratio with $4 trillion in deficit reduction. Additionally, upset Congressional Democrats by offering up Social Security and Medicare, their main bread and butter in a tough election year coming, as part of the deal.
4. Knowing that this too will be rejected, then publicly keep advocating for such a deal while simultaneously shifting into political grandstanding mode.
5. Then when the GOP collapses under the weight of the political grandstanding, introduce a clean debt bill.
Does any of this shit make any sense? I mean seriously. Does any of this shit make any fucking sense in the world?
Lets look at what actually happened...in REALITY:
1. The president accepted that the debt ceiling increase, wherein Republicans were demanding a link to the deficit negotiations, offered him an opportunity to get the deficit issue off the table for the election season. If there is tough vote to be cast, why not get it all over with now? He said so himself.
2. In order to accomplish that goal, he put everything on the table. Everything in order to get that deal of getting the deficit issue behind him. (A mistaken belief, but lets just assume he's right.) He said so himself.
3. The president, correctly, insisted that some revenue increases be included in the negotiations, because he wasn't willing to be the ONLY person to feel the political pain of cutting popular programs. The GOP had to share the pain by going against their base as he was willing to go against his. In order to get this issue off the table, everyone had to be in on it. He said so himself.
4. Both Congressional Democrats and Republicans insisted that they were NOT interested in "pain all around" or eating their peas. They want to win elections, and rightly so. If there was going to be pain, it was going to be Obama who was going to have experience it. All by himself. They weren't going to be a party to his effort to take this issue off the table for 2012.
5. When faced with leaders on Wall Street demanding "certainty" from their servants in both parties, the Senate GOP quickly blinked. So did Boehner. Now all we have to do is get the House GOP rank and file to turn.
6. With total collapse of big deals and medium sized deals, then...and only then...does the President decide to grandstand. The deficit issue will be on the table, still, but Wall Street doesn't give a shit about his political fortunes.
This makes a hell of a lot more sense because it actually matches reality. There was no master plan here, except to get a big deal that takes the deficit issue off the table. That failed, so its back to corners.
Which is why those of us in the don't negotiate camp were saying the following:
1. Don't negotiate over the debt ceiling. That's playing on GOP ground. Republicans are bluffing. They'll raise the debt ceiling even if President Obama went on vacation for a month. Wall Street is the boss and default not gonna happen.
2. May as well use this time to talk about what is really important to the American people...JOBS. Why waste time talking about something the public doesn't give a shit about? Let Congress debate over the deficit if they want to. Nothing will come of it because the political dynamics are too significant to overcome.
3. Wait for a time of pressure...like now...and use the bully pulpit to capitalize on the GOP's inevitable capitulation.
4. Sign a clean bill and then go back to talking about...well...JOBS.
In other words, no need for the this negotiation kabuki because the people who own Congress are going to get theirs. From both parties.