Monday, August 01, 2011

Who won the debt ceiling fight?

I can't figure out if Barack Obama is one of the slickest political operatives in the history of the White House or one of the worst poker players ever to inhabit that building. Let me explain why I am confused.

The evidence for Obama being an awful poker player is strong. He consistently negotiates from a position of weakness, moves toward the other side even before they ask him to, and voluntarily throws away an advantage in the interest of being 'bipartisan'. He has 'tells' that make it easy to figure out where is his real bottom line on any issue and how hard you have to push him before he throws in his cards. He doesn't seem to be able to 'read' the other side very well. It is clear that he had no idea how strong an influence the 'Tea Baggers' have on the Republican party because he wasted weeks negotiating with Boehner under the totally false assumption that Boehner, rather than the Tea Party freshmen, was in control of the House Republicans and had the power to negotiate a deal. As a result, he doesn't seem to be able to run a successful bluff or execute a strategy that forces a compromise.

Obama does not appear to know how to exercise power in a political environment. He has all the strengths and weaknesses of an academic. He is thoughtful, intelligent, knowledgeable, relatively objective, slow to take a position on complex issues, and open to listening to opposing ideas. Those are excellent personal characteristics - for a professor in an academic environment. They aren't quite so useful in a politician who must contend with fanatical ideologues who are willing to burn down the city to make a political point. I believe that because he is so reasonable, he does not understand people like the Tea Partyers. He would never go as far as they are willing to go to win a political fight.

On the other hand, I have been listening to many experienced political analysts who assert that he got as good a deal as was possible in the proposed debt ceiling legislation. After all, he has had the enormous handicap of attempting to negotiate a deal with people who are not willing to negotiate at all. Their strategy is to say 'my way or the highway'. It's like playing chicken with an idiot who is perfectly willing to crash into your car at 70 miles an hour in order to prove how 'manly' he is. When dealing with someone like that, you are always going to have to give in if you want to survive.

Here's what the administration achieved in the latest version of the bill. The Republicans wanted to fight this battle all over again in the middle of next year's election and insisted on a short term raising of the debt ceiling that would only last a few months. The current bill raises the debt ceiling enough to last into 2013. That's definitely a win for Obama. The Republicans wanted massive cuts in Social Security, Medicare, and Medicaid. Those programs are exempt from any cuts in the current bill. This is another win for Obama. The Republicans demanded that Congress pass a balanced budget amendment to the Constitution before they would be willing to raise the debt ceiling. The new law requires that both houses of Congress vote on a balanced budget amendment in the future, after the new law is in force. And there is no way a balanced budget amendment will pass in the Senate. This is another win for Obama.

On the negative side, the Republicans were able to require that the spending cuts had to be at least as many dollars as the debt ceiling was raised. On the face of it, this sounds like a win for the Republicans. Except for the fact that the vast majority of these cuts will take place several years down the road and the Republicans originally demanded that the cuts be front-loaded in 2011 and 2012. This seems to me to be at least a partial win for Obama. A more serious loss for Obama, however, was that he allowed the Republicans to frame the argument in the way they wanted. When we should have been talking about jobs and unemployment, we were wasting our time wrangling about deficit reduction. It's true that the deficit is a serious problem but unemployment is an even bigger and more immediate problem. It's like worrying about an overdue credit card bill rather than trying to put out the fire when your house is burning down. Reducing spending is a way to reduce jobs, not increase them.

So what is my conclusion? I've actually changed my mind a bit as I have been writing this entry. Originally, I was strongly in the 'lousy poker player' camp but as I analyzed the results in detail, it made me realize that Obama could have done a lot worse. Maybe he's a better poker player than I thought. I still believe that he is too academic and too conservative but it could be worse. We could be dealing with a President Palin.