Friday, December 07, 2012

Cliff report

By Mustang Bobby

Lines are being drawn, erased, and redrawn in the sand

House Republicans are privately contemplating a quiet surrender in the fight over Bush tax rates for top earners, and a quick pivot to a new fight over raising the debt limit, in which they'd demand steep cuts to programs like Medicare and Social Security.

The White House's official position on this plan is: cram it. Officials say they will not negotiate, or pay a ransom. Congress has to raise the debt limit, period.

"I will not play that game," Obama told the Business Roundtable on Wednesday. "We are not going to play that game next year. We've got to break that habit before it starts."

But privately, Obama and Democratic leaders have sought to weave a debt limit increase into ongoing negotiations to avert automatic tax increases and spending cuts at the end of the year. Their clear preference is to defuse that bomb now, in a bipartisan way, rather than to stare down the House GOP pointing a gun at the country's economy.

And recent remarks by Democratic leaders and interviews with top congressional aides suggest Democrats have no consensus plan to execute if the debt ceiling isn't increased before the end of the year.

From a purely observational standpoint, my guess is that we'll get very close to the edge of the cliff but not actually go over it. The White House knows that and so does John Boehner. It's now just a matter of getting close to it.

I'm reminded of four kids sitting in the back seat of a station wagon on a long trip on a hot summer day. It's 1963 so there's no air conditioning, no iPads or Gameboys to play with, and the radio stations are fading in and out on the AM dial. Pretty soon one kid pokes the other, either by accident or design, and soon you have a whining "Stop touching me! Mom!" battle going on. That's Congress and the White House. And the parents in the front seat — that's the rest of us — are on the verge of "Don't make me stop this car and give you something to whine about."

Are we at the Grand Bargain yet?

(Cross-posted at Bark Bark Woof Woof.)

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