The Long March Downward

by Deacon Blues

In response to Steve’s post last night, some of you rightly have put forward the economic and political negatives from the debt deal, of which Krugman speaks:

(T)he deal itself, given the available information, is a disaster, and not just for President Obama and his party. It will damage an already depressed economy; it will probably make America’s long-run deficit problem worse, not better; and most important, by demonstrating that raw extortion works and carries no political cost, it will take America a long way down the road to banana-republic status.

I can't tell you how many times in the last year I've also thought that Obama would end up being the president that cemented in the GOP's plundering of our society rather than reverse it.

Republicans will supposedly have an incentive to make concessions the next time around, because defense spending will be among the areas cut. But the G.O.P. has just demonstrated its willingness to risk financial collapse unless it gets everything its most extreme members want. Why expect it to be more reasonable in the next round?

In fact, Republicans will surely be emboldened by the way Mr. Obama keeps folding in the face of their threats. He surrendered last December, extending all the Bush tax cuts; he surrendered in the spring when they threatened to shut down the government; and he has now surrendered on a grand scale to raw extortion over the debt ceiling. Maybe it’s just me, but I see a pattern here.

David Frum and many others have said the same thing: Obama's record of appeasement and miscalculation only emboldens the GOP to push for everything, at no cost to themselves.

Make no mistake about it, what we’re witnessing here is a catastrophe on multiple levels.

It is, of course, a political catastrophe for Democrats, who just a few weeks ago seemed to have Republicans on the run over their plan to dismantle Medicare; now Mr. Obama has thrown all that away. And the damage isn’t over: there will be more choke points where Republicans can threaten to create a crisis unless the president surrenders, and they can now act with the confident expectation that he will.

Steve's narrative from last night only holds together if Obama digs in and doesn't get rolled into giving away the $4 trillion from the expiration of the Bush tax cuts. But how comfortable are any of us that it won't happen again?

Obama is a crappy negotiator. He consistently misjudges his political opponents and their motives.

Obama isn’t and never has been a progressive, and cares more about his legacy than he does the collateral damage along the way.

Obama knew as early as the fall of 2009 that his stimulus plan wasn’t going to work and yet pivoted to health care and away from jobs anyway, again, because he wanted his legacy.

Along these same lines, and because he, like Frank Rich says, is more enamored of acceptance from powerful white guys than he is courageous about principles, Obama craved approval for being serious about the debt instead of pushing back against the made-up crisis perpetuated by those who got us into this mess. He feels that he’ll get his face on Mt. Rushmore by doing health care reform, and “reforming” entitlements and the tax structure, even if the collateral damage is the middle class, seniors, and the Democratic Party.

He and his political advisors believe the key to winning next year is appealing to independents on his seriousness, and his team assumes he can convince voters to absolve him of the economy by blaming it all on a Bush hangover. They also assume the base will be with him and tolerate the broken promises and the terrible policy choices because they’ll be too afraid of a GOP president, when in fact the White House wrongly assumes Obama’s election was an endorsement of him personally without understanding that it was a rejection of Bush and demand for tangible results.

So, even if Steve is correct that Obama may have won this one once you peel away the rhetoric and look at what he actually gave up, it is also true that his willingness to perpetuate contractionary economic policies and get rolled doing so, rather than fight for jobs and fairness means he may have won the battle but lost the war.