Steve Benen persuasively argues that the Republicans now believe that they cannot get anything worth having out of threatening the full faith and credit of the United States again, and they will give us a clean bill on the debt ceiling. The White House always believed this to be the case and never wavered publicly or privately, despite sometimes strong progressive skepticism. I believed them, which is why I thought the platinum coin argument was undermining their position rather than strengthening it. Once the coin was off the table, the GOP folded its tent in short order.
The problem is not solved, however. The Republicans plan on offering a series of short-term debt-ceiling hikes. Benen is probably correct in saying this:
There’s apparently growing GOP support for a clean, short-term extension of the debt ceiling — which, as we discussed yesterday, doesn’t seem to make any sense at all — which would presumably set the stage for additional talks. This will play out soon enough, but at a certain level its impact is limited. Once everyone in Washington — Democrats and Republicans, the White House and Congress — realizes that GOP leaders aren’t prepared to allow a default on our obligations, the game is effectively over.
My hope is that the credit-rating agencies see things the same way that Benen does, because there is a risk of a downgrade if the debt ceiling threat isn’t resolved and we continue to bump against it over and over. Remember, our credit rating is based on the confidence people have that we won’t default. Leaving that in doubt in any way is risky and reckless.
In any case, the fight will move over to the debate over how to fix the sequestration. The risk there is a government shutdown. I am fairly certain that the Democrats would welcome nothing more, as any hope of winning back the House depends on a major shift in public opinion against the Republican Party, and nothing could do that more effectively than intransigence so extreme that it shuts down the government.
One of the difficulties for Speaker Boehner is that he would very much like to pass a fix for the sequester that he can use to go to conference with the Senate. If the Senate doesn’t pass its own fix, Boehner can point the blame on them. If the Senate does pass a fix and they can’t agree to a compromise in conference, then Boehner can argue that the House passed a fix and spread the blame for the shutdown.
That seems simple, but passing a fix means actually laying out what cuts he wants. And the cuts the Republicans are calling for are deeply, deeply unpopular. For this reason, Boehner fiercely resisted offering any detailed plan for cuts throughout all his negotiations with the president on the fiscal cliff. But he’ll have to do it now, or he’ll really look incompetent and he won’t have any way to shift blame when the government closes its doors. Yet, laying out the cuts for all to see could be the most unpopular thing of all.
If I were him, I’d retire.