In December last year, just after the WH capitulated on the Bush tax cuts, the President and Marc Ambinder had an interesting Q & A during which the President said this:
I’ll take John Boehner at his word — that nobody, Democrat or Republican, is willing to see the full faith and credit of the United States government collapse
This one line made me think of this famous fable:
A scorpion and a frog meet on the bank of a stream and the
scorpion asks the frog to carry him across on its back. The
frog asks, "How do I know you won't sting me?" The scorpion
says, "Because if I do, I will die too."
The frog is satisfied, and they set out, but in midstream,
the scorpion stings the frog. The frog feels the onset of
paralysis and starts to sink, knowing they both will drown,
but has just enough time to gasp "Why?"
Replies the scorpion: "Its my nature..."
To give a fuller context, here is the whole Q&A with Ambinder:
Q Mr. President, thank you. How do these negotiations affect negotiations or talks with Republicans about raising the debt limit? Because it would seem that they have a significant amount of leverage over the White House now, going in. Was there ever any attempt by the White House to include raising the debt limit as a part of this package?
THE PRESIDENT: When you say it would seem they’ll have a significant amount of leverage over the White House, what do you mean?
Q Just in the sense that they’ll say essentially we’re not going to raise the — we’re not going to agree to it unless the White House is able to or willing to agree to significant spending cuts across the board that probably go deeper and further than what you’re willing to do. I mean, what leverage would you have –
THE PRESIDENT: Look, here’s my expectation — and I’ll take John Boehner at his word — that nobody, Democrat or Republican, is willing to see the full faith and credit of the United States government collapse, that that would not be a good thing to happen. And so I think that there will be significant discussions about the debt limit vote. That’s something that nobody ever likes to vote on. But once John Boehner is sworn in as Speaker, then he’s going to have responsibilities to govern. You can’t just stand on the sidelines and be a bomb thrower.
And so my expectation is, is that we will have tough negotiations around the budget, but that ultimately we can arrive at a position that is keeping the government open, keeping Social Security checks going out, keeping veterans services being provided, but at the same time is prudent when it comes to taxpayer dollars.
Coming back to the fable about the Frog and the Scorpion, in this context, the Scorpion is the Republican party. We all know what they are. We all know that they are not willing to negotiate on anything. As Rachel Maddow said today, the great debate in Washington is no longer about revenue and tax increases, it is instead about negotiations. The Democrats want to negotiate, the Republicans not so much.
The hapless, gullible frog is the WH. The winner here has been the Republicans because their intransigence was rewarded by the WH. This latest debt ceiling deal was done without the knowledge of Senate or House Democrats. Which brings me to this excellent Op-Ed by Doyle McManus in the LA Times:
Obama has suffered, in part, from a clarity gap. Even his own supporters aren't always sure what he's willing to fight for.
"He needs to plant a flag somewhere," complained William A. Galston, a former top aide to then-President Clinton. "I don't care what color it is. But periodically planting a flag and then lowering it is no way to inspire confidence."
The president took a clear position on only one issue in the debt ceiling negotiations: He said any deal had to be "balanced," meaning it had to include new tax revenue as well as spending cuts. But in the face of Republican opposition, he backed off even that one demand.
Obama's negotiating victories in the final deal weren't on matters of substance, like tax revenue. They were on matters of process: on making sure another debt-ceiling vote doesn't happen until 2013 and making sure the mechanism for choosing further spending cuts isn't tilted in the Republicans' favor. Try selling those to voters as a victory for the beleaguered middle class.
Yes, try selling this deal to the voters, and then try explaining to them why, even after the WH capitulated to every ridiculous demand, the US was downgraded for the first time in history.
For a second let us forget about the credibility of S&P and focus just on their press release. It is worth noting here that the AAA rating is all about the likelihood of US defaulting on its debt obligations. Because we were brought to the brink by the economic hostage-takers, who were in turn enabled and emboldened by the capitulation of the WH, the S&P report says this:
The political brinksmanship of recent months highlights what we see as America's governance and policymaking becoming less stable, less effective, and less predictable than what we previously believed. The statutory debt ceiling and the threat of default have become political bargaining chips in the debate over fiscal policy.
That in essence is why we were downgraded. Because this debate wasn't a one-off thing. The debate, the hostage-taking and the capitulation, has all but made certain that this fiasco will happen again and again.
The big worry of the debt ceiling fight was not so much that US would default, because god knows the Republicans were willing to do so, but whether the US would lose it's AAA credit rating. We were made to believe that this capitulation by the WH would not just let US keep it's credit rating intact, but also provide adequate political cover to Democrats of every stripe who are up for re-election. Well actions have consequences and this shitty deal just had some consequences from which neither the Republicans, nor the WH can run and hide. There is a diary on the rec list that asks what, if any, will the consequences be for this debacle? And I ask you the same question, what should be the consequences for this debacle?