OK, now for the really bad news. Anyone looking at these negotiations, especially given Obama’s previous behavior, can’t help but reach one main conclusion: whenever the president says that there’s an issue on which he absolutely, positively won’t give ground, you can count on him, you know, giving way — and soon, too. The idea that you should only make promises and threats you intend to make good on doesn’t seem to be one that this particular president can grasp.
And that means that Republicans will go right from this negotiation into the debt ceiling in the firm belief that Obama can be rolled.
At that point he can redeem himself by holding firm — but because the Republicans don’t think he will, they will play tough, almost surely forcing him to actually hit the ceiling with all the costs that entails. And look, if I were a Republican I would also be betting that he’ll cave.
So Obama has set himself and the nation up for a much uglier confrontation than we would have had if he had set a negotiating position and held to it.
Update: I should mention that on one issue, the estate tax, the problem is apparently with the Senate; there are, unfortunately, some heartland Dem Senators who are extremely solicitous of the handful of super-wealthy families in their states, so that Obama’s people don’t think they can get a majority for higher taxes here. It’s bizarre: states like New Jersey have far more large estates, not just total but per capita, than states like Montana, but it’s the Senators from the latter that are eager to preserve the inherited privileges of the few.
Also, Noam Schieber: …”the strategic consequences are disastrous.”
This fiscal cliff deal was a good start and a Democratic victory in the struggle for the economic soul of America. But it’s only the begining of a long war of attrition being fought against the 1%. The battles ahead include, but are not limited to: (1) increasing the Capital Gains tax to 40%. (2) Eliminating the income cap on SSI contributions which is now set at $110,000. (3) Including Unearned Income in SSI contributions. (4) Phasing out the profit motive in our health care system (ObamaCare, Medicare, Medicaid). (5) Dramatically cutting the defense, homeland security, and intelligence budgets. (6) Capping the tax deductions that the wealthy and corpoations are permitted to take. Forward.
What leverage,pray tell, will the Dems have to accomplish anything stronger than what Obama has meekly given the Republicans?? Come the debt ceiling “crisis,” the R’s will have the whip hand; Obama still wants to make “changes” to SS and MM; and the Senate Dems are so Corporatized they will do next to nothing to help the non-rich. (Note that Harkin spoke a great speech, but did not filibuster to kill this monstrosity.)
Seriously, raise the cap gains tax once there’s no automatic reversal of existing tax law? Give me a break.
Obama has achieved what the Republicans want, mostly, and, as the Milwaukee Journal-Sentinel put it today, everyone from the very poorerst of the working poor to the ultra rich will pay more. It will just hurt the working poor much, much, much more.
And those who voted for Obama have just had a taste of what it means to have him ignore his base. Again. Big time, as Cheney would put it.
And these lower economic quintiles will be paying for Obama’s nefarious lies for generations.
I give Imhotep kudos for making this bitter brew sound sweeter than it is, but, hey, reality doesn’t care about spin.
Dems are cowed, Republicans are emboldened by the latest cave. Yes, it could have been worse. And it will be.
Obama’s pledge that he will not negotiate on the debt ceiling means exactly as much as his campaign pledge to raise taxes on incomes over $250,000: less than nothing. It means precisely that he will negotiate, and that he will cave. He needs Republican pressure on cuts as cover for his plans to impose austerity on social programs.
For me the real tell, the ultimate giveaway of his position, is how often he has raised cuts to Social Security as part of the fiscal cliff and budget negotiation. Social Security has nothing to do with the deficit. It only affects the debt if you assume that the US gov’ bonds held by the SS Trust Fund can be defaulted. The Trust Fund can pay full benefits for the next 20 years. How does that make it part of frenzied negotiations to avoid a “crisis.” Pure shock doctrine kabuki, whipped up in large part by Barry himself.
These charlatans, both Dems and Republicans, are going to claim that the “full faith and credit” of the US Gov’t is so sacred that we must all swallow “austerity” in order to preserve the credit ratings bestowed by private ghouls so incompetent and self-serving they fueled the financial melt down with their lemming like participation in that debacle. At the same time they are ardently protecting private holders of U.S. debt, they are going to create the impression that debt held by the Trust Fund is not real.
Our politicians are liars and lickspittles of the financial elite whose obscene wealth clearly reveals their perception that the difference between themselves and the rest of us is qualitative. They are superior beings of a different order entirely.
Let us eat cake.
You’re both right in some degree. A deep breath is needed and then we wait for the other shoe to drop. Capital gains reverted to the default at 20%. Everyone here thinks it belongs at ordinary income rates. That would sure fix the corruption of the hedge fund bracket in a hurry. The estate tax was at best going to land on 45% because of Blue Dog votes. The problem not addressed here is that children of the moderately wealthy will pay it and the Romney kids will not. A cap on deductions and other avoidance devices is what’s needed and as the hedge fund whoring shows us, not gonna happen anytime soon. The retreat to 450,000 is indefensible, but the deduction cap sets in at 250,000 and the cap did not exist under the Clinton era Code. The measure of this outcome will be determined by whether Obama goes forward with entitlement cuts without this nonsense as cover, and how the balance get’s struck between defense and social program cuts. We have ample reason to fear on both counts and we will now find out what the President actually wants. Save your anger because it isn’t merited quite yet. So far, this is the small stuff.
I never believed for a moment that Obama would stand ‘tough’ for us non-members of Corporate Amerika. It was all part of the Kabuki that is modern American politics. Rethugs so crazy they make Pol Pot seem warm and fuzzy by comparison; Dems, the 21st century version of late-20th Century Republicans; and Obama, the most ‘effective’ Republican President since Roosevelt. Welcome to one party rule, Plutocracy uber alles.
It is clear to me what the president wants, because he has been telling us since before his first term. He wants a Grand Bargain that cuts social programs. What are we waiting for?
For a fuller rationalization of the “deal,” see David Atkins at digbysblog.blogspot.com His remarks are qualified by Digby: “And the Republicans know what cuts the president has already put on the table. Let’s just say it would be a lot better for the people if they didn’t. On the other hand, I have to wonder just how many times he has to offer them up before people believe that he really wants to do it? That many elite Democrats do too?”
The rest of us get fed at, e.g., NakedCapitalism.com
But, as Susie points out, even the usual Obama defenders in extremis of Obama, such as Krugman have abandoned ship on this one. Even notorious WH mouthpiece Ezra Klein…
And BTW, who is talking about cuts to defense? If Dems wanted that kind of “balance” they certainly would have gone over the cliff, then brought back what they wanted. No one in DC has the balls to propose cuts to our war machine. We will continue to spend as much on the military as the next 13 largest countries combined. Because the elderly poor can utilize “substitution” to compensate for SS reductions.
Eternal war abroad, social Darwinism at home. Count on it. We can hedge by loading up on catfood related stocks.
2016, Biden/Rice, anyone?
Condi Rice? Susan Rice?
Huh? I don’t see Biden running for the presidency, but, who knows?
In a way, Obama isn’t conceding anything. More than anything else, he has wanted to cut Social Security, Medicare, etc. By taking in less revenue than what was clearly available (presto, chango – 250K becomes 450K), that sets up the need to cut more deeply next time around.
And yes, the debt ceiling is now deliberately and conveniently invoked again, and as commenters above have noted, will be held as sacred and a prime reason to “sacrifice”. Items having nothing to do with the deficit, such as Social Security, will be cut.
And that has been the idea all along.