Obama Folds To GOP Bluff On Debt Ceiling Negotiation

Yesterday, Jed Lewison wrote a post titled White House calling Republican bluff on debt ceiling. It seemed an premature interpretation of events to me, as I commented. Today, via Ezra Klein, it seems that Lewison's rosiness was misplaced, as the WSJ reports that President Open to Deal on Debt Cap:

Softening the administration's earlier insistence that Congress raise the so-called debt ceiling without conditions, officials now say they won't rule out linking an increase of the borrowing cap with cuts aimed at reducing the deficit—even though they'd prefer to keep the issues separate.

Again, I think this is bad bargaining. Of course, in the end, a deal will likely be made. But folding before there is even an offer on the table is simply bad bargaining. Instead, the White House should have been working on unveiling a contingency plan against GOP intransigence on the debt ceiling.

Speaking for me only

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    Wake me when it's time (5.00 / 1) (#2)
    by andgarden on Tue Apr 12, 2011 at 08:05:58 AM EST
    to take my head out of my hands.

    Me too (5.00 / 1) (#6)
    by ruffian on Tue Apr 12, 2011 at 08:20:16 AM EST
    I learned something new this morning...Obama voted against raising the debt ceiling when he was a Senator, in a 'symbolic vote' against deficits. My head might be sore soon from bashing it repeatedly on my desk.

    We used to be able to "question" taking (none / 0) (#10)
    by Militarytracy on Tue Apr 12, 2011 at 09:29:36 AM EST
    on new debt.  The markets are so fragile now though I guess they are afraid that symbolic questioning will crash everything.  Our markets are not based on fundamentals anymore, it is based only on happy thoughts of ponies.  If someone disturbs the happy thoughts, it could crash everything as Tim Geithner understands the economy.  What they have been doing will still eventually crash the economy though, and there will be no real recovery, but that understanding is not the understanding of the economy from the angle that Tim Geithner understands it from.

    But he now says it was a mistake. (none / 0) (#25)
    by hairspray on Tue Apr 12, 2011 at 02:45:45 PM EST
    I also found out about that important (none / 0) (#30)
    by cal1942 on Tue Apr 12, 2011 at 09:52:34 PM EST
    little tidbit just yesterday.

    Wish I'd known that in 2008.  Although, I doubt it would have made any difference to his supporters.  I believe they'd have come up with a WORM for that one as well.


    A deal will be made and cuts (5.00 / 1) (#4)
    by Buckeye on Tue Apr 12, 2011 at 08:16:20 AM EST
    will be done alongside debt ceiling increases.

    When we start debating the next 10 years budget and Ryan's plan is on the table with Obama's "counter", watch what happens.  Simpson Bowles will become the new center.  That will be the new "pragmatic" and "serious" effort to reform government - a good "compromise" between the Obama and the Tea Party.

    I saw Norquist on Morning Joe this morning.  He sounded to me like someone trying very hard to conceal what was really going in his mind behind a thin veil of "it is a good first step, but more is needed" line of bull.  What I think he was really thinking was "we are running roughshod over this President...I can't wait for the debt ceiling and 2012 budget debates."

    They're not debates (5.00 / 2) (#21)
    by pluege2 on Tue Apr 12, 2011 at 01:35:20 PM EST
    debates are between parties of differing views. With obama taking the republican view on everything, there can be no debate. Its only a public display of pretend debate about the color of the bow to put on the giant steaming turd obama has laid to suck the life out of the nation leaving a carcass for the plutocrats to pick over.

    LOL...tell us how you really feel. (none / 0) (#24)
    by Buckeye on Tue Apr 12, 2011 at 02:29:21 PM EST
    [Banging head on desk] (5.00 / 2) (#7)
    by Anne on Tue Apr 12, 2011 at 09:10:48 AM EST
    When I read stuff like this:

    On Wednesday, President Barack Obama plans to propose tax increases and cuts to entitlement programs such as Medicare to reduce the deficit. Administration officials hope his proposal might lead to a deal with Republicans.

    Another possible avenue--one high-profile proposal among a series--comes from a bipartisan group of six U.S. senators who are close to a plan that would reduce the deficit by $4 trillion over 10 years, Sen. Mark Warner (D., Va.), one of the key members of the group, said Monday. That package could be advanced within 30 days.

    Mr. Warner said the White House is "very aware of our efforts" and "would like to see us succeed."

    From the linked WSJ article, it's very hard to believe that this is negotiating or bargaining as much as it is advancing the agenda Obama supports.

    And what to make of this?

    While all the details of Obama's plan have yet to be unveiled, Chambliss predicted the Gang of Six's plan will be more moderate than the president's -- and he and Warner also suggested they will try to raise revenues and directly target defense spending, two issues largely left out of Ryan's proposal.

    Chambliss said the plan will aim to cut spending across the board, including on agriculture programs -- which have been off-limits to many farm-state lawmakers. Reforming entitlements, such as cutting benefits to Social Security -- which many Democratic senators, including Majority Leader Harry Reid, strongly oppose -- seems to be on the table, Warner suggested.

    Tax rates will be lowered across the board, while cutting tax deductions and credits, such as mortgage deductions on second homes, is an idea the group is pursuing.

    Gang of Six, Paul Ryan, the president: all driving down the same road, all going the same place.  All on that road through wholly dishonest debate on the deficit, creating a crisis where none exists, in service to their agendas - none of which seem to place any emphais on safeguarding the social safety net, even as they advance plans that will further depress the economy and put more lives on the financial brink.

    And now, word comes that Obama's going to back Simpson-Bowles...

    It's a damn train wreck.  

    [back to banging head on desk]

    Tim Geithner is desperate (5.00 / 1) (#9)
    by Militarytracy on Tue Apr 12, 2011 at 09:22:56 AM EST
    What they have allowed to continue to happen within the financial sector, and all the QE that is taking place, if the Republicans stand the Democrats up against the wall again on raising the debt limit we will probably have another economic crash.  If they had taken the banks over and the insolvency dealt with, we wouldn't be in this position.  If they had done bailout with real regulation we wouldn't be in this position.  But Goldman Sachs runs this White House and we don't really have an economy anymore, it is all a casino now. If the Republicans make anyone think for more than a minute that the United States could EVER default on its debt...the whole B.S.story they have continued to write will utterly crash and probably explode this time.  They were told this ages ago though and they gave everyone the finger.  They left themselves no wiggle room, there hasn't much deleveraging going on...just leveraging different mostly fairytale assets.  The only thing that keeps the economic markets stable is the notion that a correction will never be allowed to take place ever again :)  In order to avoid the possibility of collapse they will sell out everything.  And that still won't be enough for Republicans.  But they did this to themselves...and us.

    to your point (none / 0) (#36)
    by NYShooter on Wed Apr 13, 2011 at 12:00:02 PM EST
    there haven't been two consecutive down days on Wall St. in over a month.

    Insanity (none / 0) (#31)
    by cal1942 on Tue Apr 12, 2011 at 10:03:01 PM EST
    "Tax rates will be lowered across the board"

    I'm suspicious that the loophole closing will include mortgage interest deduction on all homes and dumping credits such as EITC.

    The lowered rates are just plain insanity.

    Sounds like placing a higher percentage burden on the non-wealthy.

    This is how empires fall.


    I don't understand why anyone would still (5.00 / 2) (#20)
    by pluege2 on Tue Apr 12, 2011 at 01:26:46 PM EST
    refer to obama and the administration as if they have any interest or intent at all in pursuing traditional democratic values or policies, or in anyway bucking the republicans? It is plain as day: obama is facilitating the republican agenda; he has done so from day one. It took him a little while to drop the pretense, but it is plain as can be -  incompetence and stupidity won't cut-it as obama excuses for what he is doing.

    Kevin Drum (3.00 / 1) (#13)
    by AngryBlackGuy on Tue Apr 12, 2011 at 11:47:34 AM EST

    "Here's a poll in January showing that 71% of Americans oppose increasing the debt ceiling. Here's a poll in February putting the number at 62%. Here's another one from March putting it at 60%. And here's one from April that put it at 62% after it was explained that raising the debt ceiling meant the United States might default on its debt.

    Now, I don't think these numbers will stay this high once the debt ceiling fight takes center stage and everyone gets a better idea of what it really means to refuse to raise it. Still, like it or not, liberals have long since lost the public opinion battle over the deficit. Poll after poll makes it clear that most people want to cut federal spending and don't want to raise the debt ceiling. Sure, it's a vague sentiment, and it falls apart when you ask them what they want to cut, but the fact remains that the public is largely on the Republican side of this battle right now. I happen to agree with Chait and others that Obama would be better off sticking to his guns and demanding a clean bill, but it's also worth acknowledging that this strategy starts from the bottom of a pretty deep hole. As usual, the liberal community has done a crappy job of selling the public on our perspective. Now we're paying the price."


    I think the question that needs to be asked (5.00 / 1) (#17)
    by jbindc on Tue Apr 12, 2011 at 12:33:18 PM EST
    Is how many people that were polled actually understand what the debt ceiling is and how it immpacts the economy?

    ABG (5.00 / 1) (#19)
    by Ga6thDem on Tue Apr 12, 2011 at 12:47:45 PM EST
    is a better advocate for voting GOP in '12 than the Republicans who visit here are.

    Er, that's Drum's point (none / 0) (#26)
    by gyrfalcon on Tue Apr 12, 2011 at 03:47:12 PM EST
    And in political terms, it doesn't matter whether they understand it or not.  They think they do, and they're agin' it.  As Drum says, once again the Dems. have left the field entirely to the right wing to implant their cartoon version in the public's mind.

    What's really (none / 0) (#32)
    by cal1942 on Tue Apr 12, 2011 at 10:16:40 PM EST
    amazing is that raising the debt ceiling was a mundane non story in every session of Congress.

    The news would be something like 'Today Congress increased the debt ceiling to ...'

    End of story.

    Now it's THE story.  An incredible propaganda feat.


    Well, to be fair (none / 0) (#34)
    by gyrfalcon on Tue Apr 12, 2011 at 11:54:53 PM EST
    it IS an extraordinary and wildly unprecedented level of debt.  But though you're right that it's been a non-story more often than not, it has cropped up as a big hue and cry from the right wing from time to time over the years.  There have been several battles over it, though sense has prevailed.  I'm not entirely confident that will happen this time, though.

    We've (5.00 / 1) (#35)
    by cal1942 on Wed Apr 13, 2011 at 09:25:51 AM EST
    now been conditioned to expect the least sensible solutions will become policy.

    As for debt, we don't have a deficit problem, we have an anti-tax phobia problem and the delusion that we must be the world's policeman.  Those are serious nation destroying problems.

    The only deficit that's real cause for concern is the balance of trade deficit, another serious debilitating problem.

    We're in a very bad place and we're being governed by morons.


    One reason the public supports not (5.00 / 2) (#23)
    by Anne on Tue Apr 12, 2011 at 01:46:57 PM EST
    raising the debt ceiling is because of how it's been explained to them - same for deficits; they think the US budget is just like a household budget, and if they can't live beyond their means, why should the government?  Problem is, the government is not like our households.

    There is no constitutional imperative that constrains the US from raising the debt ceiling - that is a Congressionally-imposed constraint.  There may be an argument for constraints, but as near as I can tell, the main function the debt ceiling serves is to regularly be held hostage for political purposes - as it is right now.

    I think the major problem I have with trying to discuss and debate these issues with you is that your support for anything appears to be driven by what Obama supports, and not by your own knowledge about whatever the issue at hand is.  That's why you're always citing polls - you have to, because you don't seem to have the knowledge base to argue the actual pros/cons, ins-and-outs of the issues.

    If liberals have lost the argument on debt and deficits, it's not because we're wrong, it's because the powers that be, in government and media, like the way the current argument sets up, and have failed, as they often do, to educate themselves and the American public.

    The public is also to blame; still adhering to a model where they believe the people who read the news to them every morning and evening are telling them whatever they need to know.

    The suggestion that I and others have made to you is to spend more time on policy and less on personality, because in the end, it doesn't matter if the people making the policy are nice or not if the policy is bad.  And good policy sells itself - it doesn't have to be contorted and manipulated and gamed and WORM'd.


    Silly (none / 0) (#14)
    by Ga6thDem on Tue Apr 12, 2011 at 11:56:15 AM EST
    here's the deal: These big picture polls tell you nothing once again. What specifically do people want cut? According to the polls I've seen cutting military spending ranks really high on the list but no one is proposing that.

    They should've (none / 0) (#1)
    by lilburro on Tue Apr 12, 2011 at 08:04:56 AM EST
    included raising the debt ceiling in "the Deal."  I seem to recall talk about that happening.  Apparently it didn't.

    It's worse than you think (none / 0) (#3)
    by TJBuff on Tue Apr 12, 2011 at 08:09:23 AM EST
    Obama's opening offer looks to be the Gang Of Six's perversion of Erskine-Bowles.

    It's bad bargaining, unless ... (none / 0) (#5)
    by Demi Moaned on Tue Apr 12, 2011 at 08:17:10 AM EST
    (as is commonly observed) that's what the President 'really' wants. It's kind of the The-Devil-Made-Me-Do-It justification.

    I don't believe what News Corp has to say (none / 0) (#8)
    by Farmboy on Tue Apr 12, 2011 at 09:12:10 AM EST
    about, well, anything having to do with politics, business, or social issues. If they reported that the sky was blue, the validity of the statement would be by accident, not because they actually looked out the window.

    I'll grant that I do believe their sports reporting, for the most part, especially with the volume off.

    Neither does my previously (5.00 / 1) (#11)
    by sj on Tue Apr 12, 2011 at 10:48:28 AM EST
    intelligent family who were strong O supporters.  They keep saying "I'm not going to conjecture in advance" and "I don't think that's a credible news source" and are still totally into 11 dimensional chess.  

    Or maybe not.  I could be projecting, but I think I see some cracks in that support.


    During the course of my life I've developed (none / 0) (#12)
    by Farmboy on Tue Apr 12, 2011 at 11:30:11 AM EST
    this wacky habit of trying to base my criticism of pols on their actions rather than on what the media - including left blogostan - has to say about them. This practice has kept me from getting too caught up in the current "Obama is Truly History's Greatest Monster" fad.

    But it's a free country. I certainly won't deny pundits and bloggers their right to smirk and point every time the cheerleaders pass around a new bit of gossip about the president. Whatever makes them happy.


    Ga6 (none / 0) (#15)
    by AngryBlackGuy on Tue Apr 12, 2011 at 12:04:17 PM EST
    Drum addresses that in the quote, which is why I noted it:

    Sure, it's a vague sentiment, and it falls apart when you ask them what they want to cut, but the fact remains that the public is largely on the Republican side of this battle right now.

    Obviously, our arguments look better if you parse through all of the items but (a) most people don't parse through every item and (b) we don't take their votes away simply because they have not.

    People generally want to cut the deficit.  Heck, I'd want to cut the deficit if not for the economy and the need for stimulus.  It's important to understand what our leverage is and is not.  Right now, public opinion is not with us and we have to operate in that world.  It will be very difficult to change that.

    well (5.00 / 1) (#16)
    by Ga6thDem on Tue Apr 12, 2011 at 12:31:37 PM EST
    that's because Obama is NOT a leader. A leader can convince people to follow them. Obama is a follower and apparently believes himself impotent or incompetent since he's always whining about how it was the best deal we could "get". Or you can always buy into the fact that he's a Reagan Republican which is the other theory.

    You're really advocating to vote GOP in '12 whether you realize it or not. You're basically stating that the GOP has won the argument so there's no reason to even try to do anything. We might has well fold up our tent and let the GOP do whatever they want.


    It has come to the point (none / 0) (#22)
    by Zorba on Tue Apr 12, 2011 at 01:46:00 PM EST
    where many voters will think "Why should I vote for a Democrat who acts like a Republican, when I can vote for the real thing- an actual Republican?"

    To change public opinion (5.00 / 3) (#18)
    by oldpro on Tue Apr 12, 2011 at 12:42:15 PM EST
    you'd have to change the argument.

    Change it to war profits and those who are still profiting but don't want to pay the bills.  On top of their profts they just want another tax cut while the country goes further and further in debt.


    Nothing wrong with cutting the deficit (5.00 / 2) (#27)
    by pluege2 on Tue Apr 12, 2011 at 04:12:10 PM EST
    its how you cut it that matters:

    First choice: raise revenue by making the rich pay something

    second choice: cut things that don't matter, like the obscene bloated military budget at $800 Billion PER YEAR buying nothing but animosity world-wide (except of course from the handful of plutocrats that reap obscene financial reward).


    In other words (5.00 / 2) (#33)
    by cal1942 on Tue Apr 12, 2011 at 10:25:57 PM EST
    ABG, for you, it's OK to promote ruinous policy because the polls indicate that following a disastrous course will better chances of re-election.

    It seems you're saying, to hell with leadership, it's management that counts.