It is slowly dawning on Washington that, in the wake of the pseudo-apocalyptic drama of the “fiscal cliff,” we are approaching the real thing. That thing is the confluence of two events: the vote to lift the debt ceiling, an occasion of meaningless puffery by the opposition party that House Republicans have weaponized and turned into a genuine threat to the world economy, and the beginning of automatic budget cuts, called sequestration. It is increasingly looking like the final stage in a long-delayed cataclysm that neither party feels able to avoid. At his press conference today, President Obama insisted of House Republicans, “They will not collect a ransom in exchange for not crashing the American economy.” But House Republicans appear more determined than ever to collect their ransom.
The larger issue here is finding mechanisms to cope with the rage of the tea party. Republicans took control of the House of Representatives in 2010 filled with wild-eyed fear of runaway socialism and have been gently marched through a series of steps to divert their wrath. At the outset of 2011, they demanded, and received, an immediate federal spending cut, though it quickly proved illusory. This heightened their determination to provoke a confrontation around the debt ceiling vote. President Obama and the Republican leadership managed to delay a crisis by agreeing to a $1.4 trillion spending cut, along with another $1.2 trillion in future deficit reduction, scheduled to begin right about now.
The most conservative members of the House had hoped the expiration of the Bush tax cuts would give them a hostage to threaten against Obama. They acceded to a compromise only sullenly, with promises that the debt ceiling and sequestration would be their real leverage. So the attitude of the House Republican caucus is having been forced to delay for two years their last chance to save America from Greek-Kenyan socialist hell. That mood is well captured by Mike Allen and Jim VandeHei, who report on the pent-up fury coursing through the House crazies.
The contention of the rightists is that, dangerous though it may be to fail to lift the debt ceiling, it would be more dangerous not to let them impose massive cuts to domestic spending:
To the vast majority of House Republicans, it is far riskier long term to pile up new debt than it is to test the market and economic reaction of default or closing down the government. …
That will be a tough sell, says Chris Chocola, president of the conservative Club for Growth. “What’s more irresponsible: continuing on this path to fiscal ruin, or changing the path?” he said. “There is a high level of frustration, and a willingness to do something dramatic. They think this is the only way to get Obama’s attention.”
So that’s the plan — “do something dramatic” to “get Obama’s attention.” House Republicans have officially adopted the strategic posture of public shooters and unbalanced breakup notes.
It’s also noteworthy, though not noteworthy enough to be noted by Allen and VandeHei, that Republicans consider the budget deficit so massive and urgent as to be worth provoking economic disaster, but not urgent enough to consider accepting higher revenue as part of a compromise. The fiscal status quo is worse than a potential global meltdown, but even slightly higher revenue is worse than both.
Obama’s goal is to steer the next stage of the confrontation toward a grand-bargain-style agreement to reduce the long-term deficit. He is hoping the automatic spending cuts, which disproportionately hurt defense spending, prove intolerable to large segments of the Republican Party. John Boehner has insisted he doesn’t care if those cuts go into effect. But pro-military Republicans are saying they do care, and that they only agreed to vote for sequestration in 2011 in the first place because Boehner promised them it would never happen.
Sequestration is the murkiest piece of the battlefield. It’s not clear at all what either side is willing to settle for. Both dislike the automatic cuts, but each other’s best alternative is mutually unacceptable — Obama wants to replace the sequester with a mix of higher revenue and cuts to retirement programs, while Republicans want to replace it with all cuts to social spending. In the likely event of gridlock, we don’t know if the two sides would rather just turn off the automatic cuts or let them go into effect.
In the meantime, the debt ceiling vote looms. Liberals have been looking for mechanisms to save the economy from a Republican failure to lift the debt ceiling, the most recent such device being the minting of platinum coins. Obama has waved off all his outs, insisting the only path forward is a clean increase in the debt ceiling. (“There are no magic tricks, he said today, “There are no loopholes.”)
This weekend, administration officials told Paul Krugman what they have told many of us, and what Obama said at his press conference just now: He simply will not let Republicans turn the debt ceiling into a chance to extract policy concessions. It never happened before Obama allowed it in 2011, and were it to become enshrined, it will be not only a permanent ratchet toward the Paul Ryan vision of government but an endless series of Russsian roulette games that will ultimately lead to the gun going off.
Many of us have questioned whether Obama will actually follow through on his stated intention. In these games of chicken, he always seems ready to swerve at the last moment. What’s different here is that Obama seems so determined and explicit not to pay a ransom that he is leaving himself no room to backslide. If he pays the ransom, he’ll leave himself humiliated and exposed in a way he never has.
So the two years Obama and Boehner have spent trying to deflect, delay, and placate the mania of the tea party seem to have finally come to an end point.