Wednesday, September 18, 2013

Flip the script, Mr. President

Denouncing the latest Republican round of budget negotiation-by-hostage-taking, Obama said this to the Business Roundtable today:
just flip the script for a second and imagine a situation in which a Democratic Speaker said to a Republican President, I’m not going to increase the debt ceiling unless you increase corporate taxes by 20 percent.  And if you don't do it, we’ll default on the debt and cause a worldwide financial crisis.  Even though that Democratic Speaker didn't have the votes to force through that particular piece of legislation, they would simply say, we will blow the whole thing up unless you do what I want.  That can't be a recipe for government.
I think it's time that Obama did flip the script. Not in this round, and not by holding the debt ceiling hostage. But by using the leverage his office does afford him.

Since 2011, the extremist wing of the Republican party has consistently set the terms of our budget battles. That's because the the GOP House, enabled by the Hastert Rule and the extremists' ability to dictate to leadership, has wielded an effective veto over any prospective budget compromise. As funding and debt deadlines loom they loudly proclaim their intention to exercise that veto, even at risk of national catastrophe, and no one doubts their willingness.

But the President also has a veto.  It's time -- past time -- for him to prepare the ground on which he might use it to shape the terms of negotiation.

Remember when Jan Brewer, the Republican governor of Arizona, decided that she needed to pass the ACA Medicaid expansion and faced a revolt from legislators in her own party? In response, she announced that she would veto any spending bills that did not include the Medicaid expansion. It worked. She got her Medicaid expansion.  I also recall Chris Christie, in his first budget negotiation, laying down his terms and then announcing that he would sit back, crack open a beer and wait for the legislature to send him a budget he could sign. He got a budget that met his conditions.

Assume for the time being that the current budget crisis is averted* via a short-term continuing resolution that is merely awful -- funding at sequester levels for two or three months and raising the debt ceiling for as long  -- without triggering trauma (a government shutdown) or disaster (a debt default).  That creates a two- or three-month breather to prepare for the next battle.

At that point, what if Obama announces that enough is enough with the sequester -- which, he's been complaining for months, is dragging on the economy and creating long-term damage by crippling investments in research, education, etc.?  Suppose he proclaims that he will veto any spending bills that do not either replace the sequester with a mix of tax hikes and spending cuts acceptable to him, or repeal it unconditionally?

Such a strategy might also require prepping a 14th Amendment response, or perhaps some as yet unveiled variant,  to threatened debt ceiling default. There too, as Obama suggested today, enough is enough. Republicans will keep holding the budget hostage to debt default until their ability to do so is challenged.

The only way to break the fever is to break the GOP, by obtaining and exercising superior leverage in the legislative process.  Obama had a chance to that at the fiscal cliff, when the expiration of the Bush tax cuts should have enabled him to get the sequester shut off as well as gaining his minimum revenue demand (he settled for half of his reduced December bid).  He won't have such a powerful leverage point again. But the veto, effectively wielded, might give him leverage enough to stop the budgetary bleeding.

*I am assuming that the Republican drive to defund Obamacare is a smokescreen, even if they don't consciously recognize it.  Obamacare won't be defunded. But holding that line gives Democrats cover to cave on funding levels in the continuing resolution that will fund the government for the next two or three months. Republicans will impose sequestration as a new funding baseline and shift spending from the domestic to the defense side of the ledger. Democrats will let them do it while claiming that they stood firm against the "defund Obamacare" drive. The sequester's iron grip will tighten -- unless Obama uses the breathing room to prepare to flip the script in the next round.


  1. Why not invoke the 14th amendment this go round? Why wait at all?

  2. May have to, if a short-term hike isn't somehow combined with a short-term CR.