As far as I can tell, the Washington Post's blow-by-blow of the disintegration of the "grand bargain" Obama was negotiating with House GOP leadership this summer does not change the basic outline of what we already know. Obama was getting close to signing off on a horrendous deal with grossly insufficient new tax revenue; the Gang of Six rode in with the outline of legislation closer to the Bowles-Simpson mold than the deal in progress; many GOP senators made approving noises; the $1.5 trillion over ten years in new revenues called for by the Gang of Six outline highlighted the unpalatability of Obama's deal for Democrats; he tried to boost the headline revenue in his deal from $800 billion to $1.2 trillion; Boehner and Cantor recoiled; Obama retracted the new ask and expressed willingness to sign off on the prior deal contours, but Boehner left him at the altar.
The account, in my view, simply highlights old unaswerables:
1. Why was Obama negotiating a deal with such grossly inadequate new revenues -- something like 40% of the revenue proposed by Bowles-Simpson?
Partial answer: Obama has always hewn to his campaign promise not to raise taxes on the bottom 98%. But why?
2. Why did Obama agree to negotiate under the debt ceiling deadline? Why not stonewall on that front while signalling sub rosa support for the Gang of Six, which was moving toward a better deal?
Speculative answers: a) he knew that the House would never sign off on the revenue level being bruited by the Gang of Six; b) he wanted to put the deficit reduction issue behind him, as he explained in the wake of the busted deal; c) he wanted the debt ceiling off the table until after the 2012 election (this turned out to be his one irreducible ask); and d) a grand bargain may well have cemented his re-election (which was why it was never going to happen unless it could be cast as a 90% win for the GOP -- as David Brooks did cast the prospective deal).
3. Why could the Dems never abide by the by-now-cliched James Baker dictum, "nothing is settled until everything is settled"?
There's a kind of paradox to the busted deal. Success would arguably have meant both near-total substantive victory for Republicans and re-election for Obama. And if Obama does win re-election, we're much better off for the failure.
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