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If Obama accepts the kind of "grand bargain" that has been laid out for him, this will have been the least consequential election of our lifetime.

In a nutshell, here's the proposed trade:

Republicans will allow Obama to eviscerate Medicare, Social Security, and Medicaid - and you know full well who will take the blame - in exchange for Obama giving them the continued tax breaks for the rich that they desperately desire.
See the problem here?

Its stupid policy.  Its stupid politics.

Here are three hypotheses to mull:

1. The expiry of the "Bush" tax cuts will hurt the overall economy more, and blue states more

(Blue states already contribute a disproportionate share of taxes, and therefore increasing taxes will likely hit blue states harder.)

Addressing this immediately is arguably a top political priority.

(It is also, by the way, long past time to stop reinforcing Republican bullshit branding with constant reference to "Bush" tax cuts.  Lets introduce a nice, new, simple, clean set of retroactive, but "permanent" tax cuts for those making less than $250K - and call it something new.)

2. The beginning of the "sequester" will hurt red states more

The famous Republican K Street Project has, over the last 20 years, erected a grand, baroque spoils system in the form of elaborate pork sluices to steer blue state tax dollars to red state agricultural conglomerates, oil companies, and military manufacturers in the form of contracts and subsidies.

Interrupting the pork flow will therefore hurt red states more.

The longer this drags, the more red state politicians should be willing to accept a reasonable longer-term bargain on spending priorities and cuts.

3. Trying to address the taxing and spending problems simultaneously as part of a "grand bargain" will result in Republican posturing and dragging out of negotiations until the last minute... when they'll once again light the molotov cocktails and start the filibusters.

This is the defining modus operandi of modern Republican politics, seen everywhere from the Iran-Contra investigation findings 20 years ago on down to the health care reform clusterfuck.

In game theory, what do you do when the counterparty always defects?

You retaliate, if you can (partly what the sequester does).

But more fundamentally, the obvious counter-measure is to push smaller, simpler bills.

Obama should let the tax cuts expire and then introduce a simple bill, not linked to anything else, to reinstate all the tax cuts for those making less than $250K.

Let's have a huge public fight with Republicans about this

If the Administration lets this turn into a comprehensive tax overhaul negotiation, it will take forever, and Boehner will once again get 94% of what he wants.

And there will be consequences if Boehner gets what he wants.

Cheesing off seniors with Medicare and Social Security cuts will not only increase inequality (hurting the economy), but will very effectively roll back the supposed demographic advantage that everyone is so excited about the last few days for another election or two.

Gouging Medicaid would be more politically expedient, but how ironic would that be?  Obama would be selling out women, minorities, and young people - who collectively comprise something like 75% of Medicaid beneficiaries - the keystones of the coalition that just put him over the top.

Romney would have made savage cuts and given huge tax breaks to the wealthy out of ideology.  Obama seems to be threatening to do something similar out of some mistaken concept about how his "legacy" will play out.

If he does dive into the swamp of trying to negotiate a grand bargain, this will arguably have been the least consequential election of our lifetimes.

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Comment Preferences

  •  Tip Jar (3+ / 0-)
    Recommended by:
    bublitchki, jamess, Chi

    Toto, I've a feeling we're not in Kansas anymore

    by Minerva on Fri Nov 09, 2012 at 08:17:41 AM PST

  •  Not inconsequential at all: Supreme Court. eom (6+ / 0-)

    Just another faggity fag socialist fuckstick homosinner!

    by Ian S on Fri Nov 09, 2012 at 08:22:29 AM PST

  •  Yes... (2+ / 0-)
    Recommended by:
    OIL GUY, kalmoth

    ...if Obama passes the Republican bill with no changes whatsoever, then that wouldn't go well.  The odds of that happening though aren't exactly 100% to say the least.

    But in the unlikely story that is America, there has never been anything false about hope.

    by thezzyzx on Fri Nov 09, 2012 at 08:26:45 AM PST

  •  I totally agree (1+ / 0-)
    Recommended by:

    I find that I am now far more anxious over what might take place over the next several weeks than I was in the weeks leading up to the election.

    Obama holds all the cards here. He has the luxury of doing absolutely nothing in order to make good on his campaign promise of raising taxes on the wealthy. It's going to happen in January - with or without the cooperation of House Republicans.

    Will the president stand firm? Who knows? I sure don't.

  •  Forest for the trees (5+ / 0-)

    You can't point to one or two issues, even big issues, and say that's all there is to it.

    Making Obama a one term president to elect a slimy con man representing the Tea Party who capitalizes on his party's shut down of the government to get elected would have carried a heavy historical significance.  It's very very good that didn't happen.  

    Instead the GOP is faced with figuring out how to ever get elected again without actually serving some constituency.  They're down to getting elected by manipulating the fears and bigotry of a blinkered portion of white people.  They're still causing trouble in congress right now but they're going to fragment as the party is forced to change.  This is a big moment in history.  It's just kind of a long slow moment as we live in it.  

    When truth is only a matter of opinion, advantage goes to the liars.

    by Sun dog on Fri Nov 09, 2012 at 08:30:38 AM PST

  •  Not realistic at all. (4+ / 0-)
    Recommended by:
    Hawkjt, nextstep, kalmoth, VClib

    You want to risk a recession and unemployment up to 9%, along with an immediate (this spring) tax increase on a family of four making $75,000 of $4000, in exchange for only getting additional tax revenue of $70 - $80  billion a year,which is the amount of revenue generated if you let the Bush Tax Cuts on households over $250,000 expire (the lower figure would probably be more accurate if the economy slows even more as the CBO projects) and that's it?  

    Really?  You think that additional $70 to $80 billion a year (in an annual budget of $3.5 trillion) is worth risking a recession and 9% unemployment?  

    •  There will be (2+ / 0-)
      Recommended by:
      philimus, VClib

      a lot of ''scorched earth'' folks on Dkos in the post election period.

      There needs to be a settlement between the two factions in Congress,where we do get the 80 billion from the top 2%, by raising the effective rates,whether that is thru rate adjustments or closing loopholes that hit only them.

      The key is raising their effective rates, not the table rates.

      If dems get hung up on the table rates,we may lose a chance to get other stuff done.

      I am not against the concept of a simple tax bill cleeved out of any grand bargain...but it must be a smart bill that incorporates tax reform that makes sense.

      Other spending cuts can happen, down the road,when the recovery is stronger, including military, and even medicare( Schumer says there is still waste) it is time to talk.

      •  Put a cap on itemized deductions (1+ / 0-)
        Recommended by:

        either with a fixed amount or a cap based on AGI.  This way one does not need to battle the different interest groups to not cut their favored deductions.  This also makes it more difficult for people to change their activities to avoid a tax increase.

        The most important way to protect the environment is not to have more than one child.

        by nextstep on Fri Nov 09, 2012 at 10:11:05 AM PST

        [ Parent ]

  •  What Were You Thinking? (3+ / 0-)
    Recommended by:
    FloraLine, philimus, kalmoth

    Healthcare is going to be fully implemented now.  Roe v Wade will stand.  Medicare will not be turned into a voucher program.  Social Security will continue & will not be decimated.

    Thousands of households w/ children will not be robbed of Medicaid benefits now.  Their lunch programs will continue.  They'll get to the doctors.  Educational grants will continue.  Research on stem cell development will move forward.  We also have an opportunity to put climate change on the table in a big way now.

    This isn't just about raising taxes or not......we don't enter the dark ages under the Republican thumb now.

    Only 8% of the country listed the debt as their first priority if Romney had won....that would have been a 24/7 hammering if Romney had won.  It would have been their excuse for gutting every social contracts in this country.

  •  While I fully expect the president to compromise, (0+ / 0-)

    I also hope he will prove to be a better negotiator than in the past. At the same time, I went out to vote for President Obama with my eyes wide open, and with the understanding that it's probably inevitable he will cut some spending in exchange for raising revenue to address the budget deficit.

    Aside from the important matters of nominating justices for the Supreme Court and fully implementing health care reform, however, I basically trust that President Obama will govern with a sense of fairness I could never expect from Mitt Rmoney.

    Yes, we could let sequestration take effect. Yes, the president is in a better position now than when the debt-ceiling debacle occurred in the summer of 2011 (re-election has a nice validating effect for a politician). But no, our success on Tuesday does not mean we can, or should, simply try to ram through whatever we want through the House of Representatives. Such a tactic is likely to backfire.

    I am with the diarist to the extent that I hope President Obama will be a tougher negotiator than for most of his first term. That being said, I am bracing myself for budget cuts I don't particularly like but will accept as the cost of doing business in Washington. As long as the rich are finally paying their fair share and making sacrifices along with the rest of us, I can accept that part of the deal.

    What I am NOT willing to do is accuse the president of being a sell-out the first time he makes a decision I disagree with in my capacity as a realistic progressive.

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