Another view on President Obama’s debt ceiling strategy

Posted by AzBlueMeanie:

ArtofWarEzra Klein appears to believe that President Obama is following Sun Tzu's "Art of War" in the debt ceiling fight. Obama is burning his boats to eliminate any retreat to impress upon his army that they must fight to the death to survive. Only in this scenario, President Obama is an "army of one" and must convince himself that he must fight to the death to survive.

The White House says they won't negotiate with Republicans over the debt
ceiling. But for that plan to work, Republicans need to believe the
White House when they say they won't negotiate over the debt ceiling. On the debt ceiling, the White House tries to solve its credibility problem:

Obama is purposefully painting himself into a corner. He has taken all
the various end runs around the debt ceiling — the platinum coin, the
14th Amendment, etc. — off the table
. And he’s saying he won’t negotiate
over the debt ceiling so loudly, so emphatically, so clearly, and so
often that he is putting his credibility on the line. If, after all
this, he does indeed negotiate over the debt ceiling, the White House
will lose all credibility in all negotiations going forward. That’s not
something they can afford to do, and so the White House is hoping that
Republicans, once they realize what Obama is doing, will realize he’s
serious: He really won’t negotiate over the debt ceiling. At this point,
he’s made it so that he can’t
.

This is the General Sun Tzu strategem. The only problem is, "Republicans don’t believe the White House. Nor does the media. Or,
really, anyone. This White House is seen as almost congenitally unable
to resist negotiations." General Sun Tzu's reputation preceded him, as does President Obama's.

A number of other commentators believe that President Obama is shifting all the onus onto Tea-Publicans who must do their constitutional duty of raising the debt ceiling, or suffer the political consequences of forcing the United States into default for the first time in its history. For example, Brian Beutler at Talking Points Memo writes, No Ace In The Hole:

[T]he White House more-or-less declared it won’t resort to any debt limit work around if Republicans refuse to increase it before borrowing authority lapses.

Between the official statement, a long conversation with a senior White House official, and President Obama’s press conference this morning,
I take this to be more than just an attempt to clarify the stakes and
dial up the pressure on Republicans to raise the debt limit drama free.
There really is no “Plan B” if we breach the debt limit, other than that
the government will shirk 40 percent of its obligations and Republicans
will feel enormous pressure to raise it before the economic fallout
becomes too catastrophic.

* * *

Announcing that there’s a Plan B in advance of the deadline would be a
bit less shrewd than revealing an ace in the hole before betting is
over. In a situation like the debt limit fight, revealing the existence
of a fallback plan would be all but self-fulfilling — and thus, for all
the reasons Josh outlined here,
would amount to assuming all of the downside risk the GOP is creating
for itself by making outlandish threats in the first place.

* * *

So there’s no ace in the hole. Whether that’s legally ineluctable or a
decision the administration made to force Republicans to reckon with
their own behavior, it’s where we are. And now instead of tussling with
Obama over the legitimacy of platinum coin seigniorage, Republicans have
to answer for this, as Obama put it at today’s press conference: “If
congressional Republicans refuse to pay America’s bills on time, Social
Security checks, veterans benefits will be delayed. We might not be able
to pay our troops or honor our contracts with small-business owners.
Food inspectors, air traffic controllers, specialists who track down
loose nuclear materials would not get their paychecks. Investors around
the world will ask if the United States of America is in fact a safe
bet. Markets could go haywire. Interest rates would spike for anyone who
borrowed money.”

They only bear responsibility for those consequences if Obama’s hands are truly tied by the debt limit law.

This is the Obama as Spock playing eleventh level chess strategem. We mere mortals cannot understand the brilliance of his move. Yeah, I'm not buying that.

The problem with this line of reasoning is that it is a partisan political strategy, not a governing strategy. The election is over, there is a constitutional obligation to govern. Default is going to cause economic disruption and financial strain to many Americans. The American people have not shown any inclination to hold Tea-Publicans accountable for the economic catastrophes they are responsible for over the past 30 years with their faith based supply-side "trickle down" GOP economics.

This strategy would require a collective epiphany by the American people to come to their senses and realize that Tea-Publicans have been selling them snake oil all of these years. But true believers never question their faith. Disappointment means only that they must purify themselves to have greater faith. Such is the way of fanatics.

0 responses to “Another view on President Obama’s debt ceiling strategy

  1. Paulo McManus

    I am not as expert as Ed Butowsky when it comes to financial, economic topic such as debt ceiling but i am starting to worry the fate of Americans this time.

    http://www.edbutowsky.com/media-center/economic-impact-of-debt-limit-showdown-on-american-people/