The level of audacity coming from the Democrats – who I chiefly blame for creating this economic mess in the first place- is simply unbelievable. And I mean, unbelievable- as in, if I saw this plot line in a movie I would see it as bad writing, believing no career politicians could be that arrogant and ignorant of economic realities.
To that end, I don’t believe this is an economic battle at all. It is really shaping up as a political battle where President Obama is looking to consolidate his power as being both executive and supreme legislator, asserting his authority over all branches of government (having already dismissed the Supreme Court as an “unelected group of people”).
Apparently, I am not alone in my belief. Charles Krauthammer believes similarly:
“Let’s understand President Obama’s strategy in the ‘fiscal cliff’ negotiations. It has nothing to do with economics or real fiscal reform. This is entirely about politics. It’s Phase Two of the 2012 campaign. The election returned him to office. The fiscal-cliff negotiations are designed to break the Republican opposition and grant him political supremacy, something he thinks he earned with his landslide 2.8-point victory margin on Election Day.
This is why he sent Treasury Secretary Tim Geithner to the Republicans to convey not a negotiating offer but a demand for unconditional surrender. House Speaker John Boehner had made a peace offering of $800 billion in new revenues. Geithner pocketed Boehner’s $800 billion, doubled it to $1.6 trillion, offered risible cuts that in 2013 would actually be exceeded by new stimulus spending, and then demanded that Congress turn over to the president all power over the debt ceiling.
Boehner was stunned. Mitch McConnell laughed out loud. In nobler days, they’d have offered Geithner a pistol and an early-morning appointment at Weehawken. Alas, Boehner gave again, coming back a week later with spending-cut suggestions — as demanded by Geithner — only to have them dismissed with a wave of the hand.”
Kudos to Mr. Krauthammer for successfully pulling off the first Alexander Hamilton duel joke seen since 1804.
“Such nonsense abounds because Obama’s objective in these negotiations is not economic but political: not to solve the debt crisis but to fracture the Republican majority in the House. Get Boehner to cave, pass the tax hike with Democratic votes provided by Minority Leader Nancy Pelosi, and let the Republican civil war begin.
It doesn’t even matter whether Boehner gets deposed as speaker. Either way, the Republican House would be neutered, giving Obama a free hand to dominate Washington and fashion the entitlement state of his liking.”
The Obama Administration has created a nice, tyrannical situation for themselves. If they reject any reasonable offer, they may be able to get the weak-willed Republicans to cave. If they can do that, the Democrats get what they want while simultaneously weakening the confidence in Republicans and driving a wedge between conservatives and moderates.
“What should Republicans do? Stop giving stuff away. If Obama remains intransigent, let him be the one to take us over the cliff. And then let the new House, which is sworn in weeks before the president, immediately introduce and pass a full across-the-board restoration of the Bush tax cuts.
Obama will counter with the usual all-but-the-rich tax cut — as the markets gyrate and the economy begins to wobble under his feet.
Result? We’re back to square one, but with a more level playing field. The risk to Obama will be rising and the debt ceiling will be looming. Most important of all, however, Republicans will still be in possession of their unity, their self-respect — and their trousers.”
If the Democrats take us over the cliff, they may try to frame the narrative as a tragic result of Republican stubbornness to protect the “wealthy.” However, when tax rates go up, it’s not too hard to convince the American people to blame the one in charge. Plus, going over the cliff obstructs Obama’s power grab and Republicans can call it a strategic victory- especially after they push through a restoration of the tax cuts.