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(cross-posted at gnomanomics)

President Obama is offering to make cuts to medicare and social security as part of a broader deal to raise tax revenue, cut spending, and decrease the deficit by $4tn over the next decade (before this push, negotiations had brought that number to $2tn).

Putting aside the personal gut reactions to this deal, a lot more interesting question is the "why" of it.  What does this do in the political battlefield?  What is the price, what is the gain, and how could this possibly be better than the walk-away position for president Obama?

Surveying the reactions, Ezra Klein writes that this deal could be a break from the kabuki theater we are used to seeing on the deficit, but that he's not sold yet.  Nobel Laureate Paul Krugman calls Republicans the Armageddon Caucus, drawing ties to the Great Depression.  Meanwhile, KOS bloggers are proclaiming that Obama is committing political suicide and predicting that this deal could rip the party itself apart.  Erick Erickson of redstate fame surprisingly picks up the "Republicans as hostage takers" analogy in his blog "Republicans Must Show They Will Shoot the Hostage," in which he argues that Republicans who end up making a deal and voting on the debt ceiling are "betraying" their own side, and for that reason the hard line against the debt ceiling rise that some Republicans are taking is untenable.

So now we get to the meat of it.  Both parties' constituents see this as betrayals from their own leaders.  In order to understand president Obama's decision, let's look at the ZOPA.

Speaker Boehner's walkaway position is not clear, because even after this negotiation with Obama he must still negotiate with his party.  He can side with the Erick Ericksons and refuse to raise the debt ceiling.  Or he can side with the David Brookses of his party who know recent history that says that government shut down under Gingrich handed Clinton the reelection, and therefore are cautioning their own party not to turn the country's economy into a hostage, and especially not to shoot the hostage.  Given this large divide in his own party, no matter which way Speaker Boehner chooses, he is going to infuriate a substantial portion of his base and--even better for president Obama--this is not a maneuver that can be pinned on the Democrats: whatever decision Speaker Boehner and his caucus make, it will plainly be their own choice without coersion from the other side, as they have had to walk away from the negotiation table with the Democrats altogether to even get to this point.

So the Speaker Boehner walkaway position can be shorthanded as "openly taking Economy hostage, and deciding whether to shoot him."

President Obama's walkaway position is more straight-forward.  The debt ceiling raise is not in his or his party's hands, ultimately, because the decision lies mainly in the Republican-controlled House.  So if the debt ceiling lapses and the Federal government is largely shut down to pay off debts, history shows that this would work very much in president Obama's favor, especially given that this subject is out in the open, and Republicans have begun shooting at themselves already.  This side comes with a risk, of course, because moderates tend to like to see a functional government and may blame whoever is in charge even if the other party is stalling.  Or if the David Brookses win, then Obama gets a clean debt ceiling rise through Congress without having to give up anything.

So those are the outer boundaries of the ZOPA.  But what is inside?  By making this and similar overtures, President Obama gives up support from his own base, while accomplishing some very important things:

1. He shows publicly that he was willing to take on his own sacred cows, which makes it more significant if Republicans refuse to do so.  Especially if they refuse to do so in the sole interest of millionaire and billionaire tax loopholes on things like corporate jets, which has been maneuvered lately.

2. If the negotiations fail and the government shutdown does happen due to failure to raise the debt ceiling, president Obama now has a full ledger to point to regarding his willingness to compromise.  This absolves him to the greatest extent possible of any blame for the resulting problems, and pins it squarely on the Republicans.

3. President Obama loses support from his own base, however not by a significant margin because--remember--this same base is being absolutely horrified by what the Republicans are proposing and fighting for.  And as discouraged as the base may become due to this, remember that it is July of 2011, and elections are in November of 2012.  That is a long time in political terms, and the memory hole kicks in in about 2 weeks anyway.

What do Republicans get?

1. This pressures the David Brookses in Congress to choose to treat with Democrats over their own Erick Ericksons, or else choose to re-enact the Gingrichian government shutdown.  This is a significant and painful fork for them to negotiate.

2. This plainly pits the financial Republicans against the values Republicans, a chance that it would be political malpractice for president Obama to ignore.  Financial Republicans will openly revolt if the debt ceiling limit is not raised, because that would represent a significant and long-lasting hit to their bottom line.  And bear in mind, Republicans are especially beholden to this portion of their constituency given Citizens' United and unlimited campaign financing.  

On the other hand, the values Republicans who just want federal government to be annihilated represent a significant portion of their voter base, including their volunteer and word-of-mouth election efforts.  And given that Republicans are less popular than Democrats nowadays in the American public at large, they need to rely on their supporters to be extra enthusiastic to make up for the difference.

3. Even if Republicans evade the obvious political bullet of shutting down the government by treating with Democrats, this ends up not being great for them in the long term anyway because, if the economy continues to recover, credit will primarily go to the party in charge, which is presently the Democrats.  They would additionally be able to say that they had to give up significantly in order to get there, so the Republicans would look like the ones who kept trying to put the turd in the punch bowl.  It would be a hit to the Republican political and economic policies, and a feather in Democrats' cap.

So, in a sense, this is a Queen sacrifice on the part of the Democrats.  Both sides get injured, but by examining the ZOPA we can see that this move puts the advantage squarely in Democratic hands.

The democrats who are discouraged by this, and indeed I can see arguments that SS and Medicare cuts are long term, might be encouraged if they imagine that what's at stake here isn't just four years of a presidential reelection, but possibly the crucial Kennedy seat in the Supreme court.  If they want more, and I'm certainly among them, we're going to have to see the long arc of politics and not just the latest play.

(cross-posted at gnomanomics)

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Comment Preferences

  •  An interesting and thoughtful diary (0+ / 0-)

    how bloody refreshing today!

    In the choice between changing ones mind and proving there's no need to do so, most people get busy on the proof.

    by jsfox on Thu Jul 07, 2011 at 10:00:15 AM PDT

  •  Fuck this beltway bullshit. (0+ / 0-)

    When they own the information, they can bend it all they want. -- John Mayer

    by S M Tenneshaw on Thu Jul 07, 2011 at 10:02:12 AM PDT

    •  SMT - I think the Dems have a bad hand (0+ / 0-)

      While I do not think the President would ever let the US default on its debt, the reality is that about 40% of the F2011 must be funded by additional borrowing. The President has two choices, come to some agreement with enough House Republicans to pass a new debt ceiling bill, or be the manager of a 40% budget cut. The gopers know that the Obama administration would never let the US default, because the result would be catastrophic.  The gopers can achieve, through no action, the kinds of budget cuts they could never achieve legislatively. The gopers will not cave on this. Why would they? They have the good hand.  So I for one will not be angry at the President, or Democratic Congressional leaders, if they make major concessions to the gopers because in my view they have a very weak hand to play.  

      "let's talk about that"

      by VClib on Thu Jul 07, 2011 at 10:06:30 AM PDT

      [ Parent ]

      •  understanding and reacting (2+ / 0-)
        Recommended by:
        Tonga 23, VClib

        I think one of the major struggles for any member in this community, us at Gnomanomics included, is that we're trying to do two things that require different lenses.  But sometimes we only use the one lens we are most used to.

        First, we're politically active, we have ideas of what would work best, and so we react to the news as we find it.  That is unavoidable and, as we are seeing in Wisconsin for example, can be a good or even great thing.  At the same time, our first reaction can be based on little information, or incorrect assumptions, etc.  When it comes to actually trying to explain recent history or understand policy, especially if we ever want to do something like debate Republicans in a rational way that could actually change their opinions instead of coming off as an attack, it's not a very useful lens.

        Second, as reasonable people who want to be able to affect policy by addressing it on a sound basis, we need to be able to understand where it's coming from, so we can address the actual issue at hand.  This means putting aside for a second our particular stake or side and asking what the political battlefield looks like, what the stakes are, and what each side is really aiming for.  It's possible to do this without belittling our own causes, in fact by stepping aside for a second and surveying the battlefield we can find how to argue for our own causes more effectively.

        What we would find often is that, when we look through the Second lens, the politicians aren't participating on the same battlefield we are.  We want rights, programs, and what have you; they want reelection.  We need to ask ourselves how those two goals map onto each other.

        So do the Democrats have a good hand?  According to the first lens, I agree with you, they don't.  It's not a good year to get what we, as concerned people living everyday lives in a partially recovered economy, want.

        But in terms of the second lens, our hand is pretty solid.  The republicans have painted themselves into such a tight corner that now their "unholy" alliance of business and values republicans is starting to fracture.  That's something that definitely could not be said as recently as a year or two ago, and it's significant.  Without that alliance, they become substantially less powerful than they have been.  And that may not be of much comfort this year, but I mention Justice Kennedy's seat as an example of how it could pay dividends later.

        So now we have to ask what we're after.  Are we after a particular policy, and do we want to practice political brute force to get there?  If so, the example of how we might go for it would be health care reform like we saw in 2009, where eventually we won but it was a bloody, Pyrrhic battle that actually empowered the Republicans, and disempowered us even though we got (kind of, a highly stripped version of) what we wanted.  It can always be improved later, and in fact getting something at all was a good foothold; but at the end we weren't happy with it even though it cost a lot of political capital, and that's something we should take into account too.

        Or do we want a stretch like the '40's through the '80's, where we had fairly uninterrupted control of the Congress and were able to make steady small steps on policies like Social Security, that once started for widows and orphans and ended up eventually covering everyone it does today?  We tend to think of SS as FDR's victory, and to a large extent it was, but the policy he got through was substantially smaller than what we have today.

        So my opinion is that, even though it's painful and frustrating, we need to be willing to see small steps in the larger picture.  I get frustrated too, and my first reaction to most news I see is along the lines of what many frustrated people post here.  The people I talk to on a daily basis know I can be a firebrand about any issue that rubs me the wrong way.  But when my political allies are taking positions like this that are perplexing to me, my next step is to ask why, and to try to at least understand the battlefield as they see it.  

        I was often accused ascribing to an n-dimensional chess theory, but really, my diagrams are one-dimensional.  All I'm proposing is this: that one dimension is in the politician's best interest, not in that of his constituents.  And there's some overlap, but it's imperfect.  We need to be able to bridge that gap if we want to move our politicians.  Otherwise, we're speaking different languages, we'll vote or sloth them out for reasons they don't understand or predict, and we'll all end up the losers at the end.  I'm not saying I like it, but this is the position we find ourselves in imo.

  •  The bigger question (0+ / 0-)

    How does this affect 2012 voter turnout. I believe the Repubs work harder to get a majority in both House and Senate and beat Obama.
    The Dem voter base I believe says fuckit and stays home. Asking themselves what is the difference between Dems and Repubs, saying hey they both fuck us so why vote. NAFTA hurt us and may have cost Gore the election. These cuts to Social Security, Medicare and Medicaid could very well be Obama & the Dems Waterloo.

  •  This All Looks Like Act II, "It's the Economy, (0+ / 0-)

    Stupid," in the three-act play, Get Me Re-elected.  Not kabuki -- standard American politics-as-usual.

    Act I ended when Cantor walked out.

    The entr'actc was the golf game during which the president told Boehner, "Let's make a deal in which I guarantee everything's on the table, and you make a deal in which you guarantee not to walk away from negotiations until some mutual agreement is negotiated.

     We both know that Republicans won't survive the 'do-nothing' label in '12 Congressional elections; that I'll be re-elected no matter what; and that the best chance for Republicans to hold the House in '12 is to appear to hold government hostage while quietly and out of the spotlight, working on deficit reduction the Democrat's way."

    Looking forward to what brings down the curtain on Act II.

    Readers & Book Lovers Pull up a chair! You're never too old to be a Meta Groupie

    by Limelite on Thu Jul 07, 2011 at 11:14:45 AM PDT

  •  "Queen sacrifice"??? (0+ / 0-)

    You don't sac the queen unless you believe you will be able to force mate a few moves later as a result.  Nothing about this situation suggests that will happen.

    Conservatives (both the GOP and Consevadems) get what they want.  Dems get nothing in return.

    This idea that somehow popular opinion will coalesce behind Dems ignores the fact that Dems are the ones who will be voting for these UNPOPULAR changes and Obama will praise the changes and sign them.  3/4 of voters want the OPPOSITE of what the Dems and Obama are currently negotiating for.  They are more concerned about jobs too...which this won't help.

    Dems committed this same piece of 11th Dimensional Chess Queen Sacrifice in the 2010 midterms:  they signalled that they would fold on the Bush tax cut extension.  And they got their clocks cleaned for it.  Their reward:  they are getting hammered over the deficit now and have no defense.  A sacrifice with "no compensation" (as we call it in chess) is simply a blunder.

    How about the PO in insurance reform?  Popular opinion ended up against the Dems because of the damned mandates.  Again, the "realists/pragmatists" went against popular opinion (and economic reality) and progressives been tarred and feathered for it.  

    Folks prematurely celebrate "GOP overreach."  Sounds great in principle, but Dems never seem to make them pay or actually reverse the overreach.  Is anyone going to restore lost pensions, bargaining rights, or any cuts made to SS?  No, not anymore than a Democratic majority with Democratic president would insure that the Bush tax cuts were not extended.

    Even if Dems somehow benefitted from GOP overreach, would they do anything with it?  (No, I don't mean winning an election, I mean actually reversing the very things that created the problems.)  Recent history suggests they would not.  It ain't about winning an election, it's about changing the directory of the country--something the Democratic party doesn't understand anymore.

    The real queen sacrifice is being willing to give up an election or two to implement major policies that will lead to checkmate of the opponent.  Conservatives seem to be doing just that...much the country's detriment.

    If you ask "what color is the poster" when someone criticizes the President's policy or track record, you are probably a racist. If you assume white progressives don't like the President's policies because of his skin color, you are definitely a racist.

    by Celtic Pugilist on Thu Jul 07, 2011 at 11:36:34 AM PDT

    •  yes (0+ / 0-)

      I largely agree with you.  I am uncomfortable with the strategy, and I don't have much faith in the Democratic party's ability to push an advantage either.  I also think that this offer negates a substantial advantage Democrats have, because Social Security is such a popular program and now they will no longer be able to say they were staunchly defending it.  I also have tremendous problems with offering Social Security and Medicare cuts to pay for $2tn in deficit cuts, after authorizing $800bn in tax cuts to the top earners in the US.

      Don't get my position wrong, here.  Describing what I think the Democrats' strategy is, and liking it, are two different things.

      As far as my actual characterization of the policy goes, do you think it is a good one or do you think they have something else in mind?

      •  I can't understand what they have in mind (0+ / 0-)

        I wish I could fathom the administration or Dem leadership's strategy over the past two years, but I can't.  If their intent was to surreptitiously not carry out their stated agenda, then they have performed brilliantly.  They've won Pyrrhic victories that have put them at strategic disadvantage.  None of the so called victories can or will be followed up.

        I guess the problem I have is that I can't see any way for what they propose to work out in their favor or the nation's favor.  

        Conservatives are masters of spin and framing.  Democrats suck at it.  The Right doesn't play by the same ground rules as the Left.  And the ref (media) is inept--someone compared it to WWF wrestling refs recently.  So conservatives are effectively made of teflon.  Nothing sticks to least not for very long.  Greatest economic disaster since the Great Depression and they are going to lay it at the door step of the Left when it was really a product of conservative policies nearly identical to the Great Depression.  And why can't we recover?  More conservative policies...this time from Democrats who have adopted conservative framing.  

        Democrats refuse to differentiate themselves from conservatism.  They are terrified of being labeled liberal, or socialist or worse.  So they lose the midterms by aping "moderate" conservative positions.  The solution for such a loss...act more conservative.  Voters can't tell the difference between the two parties anymore.  But they know a Democrat is in the Whitehouse and Dems hold the Senate, so they associate the continued malaise with Democrats.  

        If you ask "what color is the poster" when someone criticizes the President's policy or track record, you are probably a racist. If you assume white progressives don't like the President's policies because of his skin color, you are definitely a racist.

        by Celtic Pugilist on Thu Jul 07, 2011 at 10:43:26 PM PDT

        [ Parent ]

  •  If this checks out as you portray it, as a tactic (0+ / 0-)

    and not a real negotiation piece, then it could be a clever political maneuver to frame the Repubs as the obstinate pigs they are without costing much of anything.

    Then it would be a presidential fork stuck into the Repubs. If however it is a real negotiation point, it's an epic fail worse than a presidential spork that doesn't work on a soup kitchen mystery meat nor the fanciest restaurants' priciest filet anywhere in America outside of DC.

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