"President Obama wins 'fiscal cliff' victory, but at high cost"

fiscal cliff 8 prinicples Robert Reich MoveOn

Via Robert Reich, MoveOn.org


The blog headline is the title of an article, or rather, an analysis of the fiscal negotiations in the L.A. Times.

Many liberals are asking when Democrats, led by President Obama, will stop conceding to Republicans, especially when we have the upper hand, when we finally have the "political capital" and leverage we need. Compromise is great, but not at the expense of future negotiations or setting bad precedents. But the problem is, Republicans will never stop demanding and holding America hostage. Ever. We won the election, we continue to win in the polls, but that doesn't faze those on the right in the least.

Let's get one thing straight: "Both sides" are not equally responsible for the mess we're in, and it's time to make that clear...er. It's time to hold the GOP accountable, loudly and often.

That said, the Bush tax cuts-- now the Obama tax cuts-- are largely intact with the exception of those making over $400-450,000. I am hardly "anti-Obama," but sometimes he seems to be losing those multi-dimensional chess games he plays. How much will he be willing to compromise when it comes to Social Security, Medicare, and Medicaid? The "sequester" battle has been postponed , so I guess we'll have to wait a few months to see who declares "check mate."

At this point, I'm in wait-and-see mode, but as Paddy said in an earlier post, "I thought about getting excited last night, but I knew better. The whole deal stinks."

L.A. Times:

But Obama's victory fell short of what he had campaigned for, and came at a high cost. Even if the House later Tuesday or Wednesday musters the votes to approve the bill that the Senate was to vote on in the wee hours of Tuesday morning, the terms of this compromise guarantee another pitched battle over spending and taxes within months.

Whether the agreement announced Monday evening turns out to be truly a victory for Obama or a lost opportunity, as many of his liberal critics feared, will depend heavily on how that next battle turns out. [...]

The persistent battle over spending, which already has consumed Washington for two years, threatens to block Obama's other major legislative priorities, including immigration reform and gun controlMoreover, to get a deal, Obama had to accept far less new revenue than he had wanted. [...]

"I just think that's grossly unfair," Sen. Tom Harkin (D-Iowa), a liberal leader, said in a Senate speech Monday objecting to the deal. "If we're going to have some kind of a deal, the deal must be one that really favors the middle class — the real middle class." [...]

The challenge of squeezing tax increases out of a Republican-led House will get harder, not easier, in the new year. Without the threat of an automatic tax increase, Obama has much less leverage, said Jared Bernstein, the former chief economist and economic advisor to Vice President Joe Biden. And Republicans will gain leverage through their threats to refuse an increase in the debt ceiling, which would cause the government to default on its bonds. [...]

"The Republicans are absolutely sharpening their knives for that next fight, which is horrific, by comparison — a much worse self-inflicted wound on the economy."

"To be fair," he said, "there are good things in this deal and if the president truly refuses to negotiate on the debt ceiling, it may turn out to be a pretty good deal. But if he folds, then he will have squandered his leverage."

Check, mate.

check mark