The Education Of Barack Obama

The Very Serious People at the New Republic finally get around to analyzing last summer's debt ceiling negotiation. TNR's idea that the softness of the economy wasn't visible right away is rubbish, of course. It was certainly visible everywhere else, except maybe in the Beltway. This article explains in many, many words what any school kid knew instinctively anyway, that it was pointless to negotiate with the Republicans:

Lew, Sperling, and Reed had served as top Clinton aides when the president had struck a budget deal with Republicans in 1997. The effort had led them to believe another deal was possible now. “The experience we had with the Republican Congress in the mid-nineties was that they came in and didn’t want to reach agreement,” says one Clinton veteran who returned under Obama. “But, by mid-’96, they were pleading with us to agree with them on something.”

Unfortunately, this analogy ignored some fundamental differences between the mid-’90s and 2011. Republicans were less extreme during the Clinton years—and as of 1995, the unemployment rate was under 6 percent. In 2011, on the other hand, the Republicans were in the grips of true fiscal fanaticism while the economy was distressingly fragile. Even if it were possible to eventually strike a deal, the country couldn’t afford a prolonged debate over how to apportion the pain.

In June, the negotiators reached a provisional agreement with Republicans on more than $1 trillion in cuts, and the Obama contingent had begun to believe a much larger deal was in sight. Such a deal, they assumed, would involve Democrats agreeing to modest Medicare cuts in exchange for eliminating a few narrow tax breaks, like those benefiting oil companies and corporate jet owners. “Biden and Sperling and Lew were pretty enthusiastic about where this is going,” recalls one White House official familiar with the negotiations.

...Eventually, one congressional Democrat participating in the negotiations, worried that the conversation had focused too much on cuts for Medicare recipients of modest means, insisted to the Republicans that they could defer the tax discussion no longer. “Why should we be engaged in a conversation asking them to pay more unless you’re talking about closing corporate tax loopholes and special breaks for corporate jets?” he asked.

...“Let me get this right,” Kyl finally said to Lew and Sperling when the discussion flared up again. “You’re saying there are Medicare savings you think would be good policy. But you won’t do them unless we agree to raise taxes?” Lew and Sperling looked back at him stone-faced and simply said, “Yes.” A few days later, on June 23, Cantor and Kyl withdrew from the negotiations. Even the deal the president had deemed insultingly weak was out of reach.

...Under normal circumstances, the logical response to a negotiation in which one’s counterpart walks away from increasingly attractive offers is simply to give up. But, by late July 2011, this was no longer an option. There were less than two weeks before the government’s mounting pile of IOUs ran smack into the debt ceiling, risking global financial calamity. After three and a half months of largely fruitless negotiation, the White House still had to reach agreement with the Republican House.

Not surprisingly, given that Obama was determined to avoid a debt ceiling catastrophe while many Republicans believed hitting the limit might do some good, the eventual deal skewed heavily toward Republican priorities.

...FOR TWO AND A HALF YEARS, Obama had been hatching proposals with an eye toward winning over the opposition. In most cases, all it had gotten him was more extreme demands from Republicans and not even a pretense of bipartisan support. Now, after the searing experience of the deficit deal, he still wanted reasonable, centrist policies. But he was done trying to fit them to the ever-shifting conservative zeitgeist.

...Sperling, who had long been a voice for ambitious policy, took the directive to heart. By the end of the month, his staff had come up with $450 billion worth of proposals to boost the economy, including an expanded version of the payroll tax cut Congress had approved the previous December.

...Obama was finally shedding the caution of his first three years in office. Even before the deficit negotiations collapsed, he'd begun criticizing Republicans for their aversion to “shared sacrifice.” He gave an impassioned speech about economic inequality and vowed to ensure that millionaires paid their fair share in taxes. “It is wrong for Warren Buffett’s secretary to pay a higher tax rate than Warren Buffett,” he famously said.

For voters contemplating whether he deserves a second term, the question is less and less one of policy or even worldview than of basic disposition. Throughout his political career, Obama has displayed an uncanny knack for responding to existential threats. He sharpened his message against Hillary Clinton in late November 2007, just in time to salvage the Iowa caucuses and block her coronation. He condemned his longtime pastor, Jeremiah Wright, just before Wright’s racialist comments could doom his presidential hopes. Once in office, Obama led two last-minute counteroffensives to save health care reform. But, in every case, the adjustments didn’t come until the crisis was already at hand. His initial approach was too passive and too accommodating, and he stuck with it far too long.