The Democrats’ Desired Deal Is No Deal

Why Obama is willing to go over the cliff.

President Barack Obama Tuesday indicated an unwillingness to strike a deal with Republicans to avoid tax increases and spending cuts—dubbed the “fiscal cliff” by Ben Bernanke—unless the opposition agrees to raise taxes on the wealthy. “We’re going to have to see the rates on the top two percent go up and we’re not going to be able to get a deal without it,” he explained to cable’s Bloomberg channel in his first television interview since the election.

The hard line, following a bizarre proposal to include additional “stimulus” spending as part of the deficit-reduction plan and vest unilateral power in the president to raise the debt ceiling, has convinced many that the president wishes to drive off the fiscal cliff with his foot firmly on the gas pedal. Reporting within the left-wing press supports the idea that the president isn’t averse to walking away from the bargaining table. “What has changed is the president’s hand,” David Corn of Mother Jones reports. “According to senior administration officials, Obama is not eager to go over the cliff, but he is willing. If no deal is reached by the end of the month, all the Bush tax cuts—for the rich and not rich—will evaporate.”

Certainly the president’s left-wing considers no deal the most desirable deal.

Former Democratic National Committee chairman Howard Dean, appearing on Lawrence O’Donnell’s MSNBC program last week, called the fiscal cliff “the best deal progressive Democrats are going to get.” Why? “One, we get the Clinton tax rates on everybody. Will it cause a problem? Yes. There will be a short recession and it will be painful. But two, we get defense cuts. Republicans are never going to agree to that. And three, there are some human services cuts which we`re not going to like, but it’s the least possible damage.”

When asked if going off the fiscal cliff were the best option, liberal economist Dean Baker told The Progressive “Absolutely.” The Center for Economic and Policy Research director explained, “The do-nothing outcome is the one [Obama] campaigned on.” Without a deal, the president gets steep defense reductions and gets to “raise taxes on the richest 2 percent, which is what he wanted.”

Radio host Thom Hartmann finds “an incredible opportunity” in the fiscal cliff. “I think it’s time to drive off the so-called fiscal cliff,” he explained to followers, calling the deadline to avert tax hikes and spending cuts “nothing but a speed bump.” Hartmann articulated three reasons progressives should support leaping off the fiscal cliff. First, though “it goes nowhere as far as it should, which would be to roll back the Reagan tax cuts, it’s a start on moving America in a more egalitarian direction.” Second, “most of those cuts to the Pentagon budget are good things.” And third, it will put Republicans on record as hating the poor and aged by endorsing cuts to Medicare and Medicaid.

To be sure, a few right-of center scribes, including The Daily Caller’s Tucker Carlson and The Daily Beast’s Megan McArdle, have similarly written of going off the fiscal cliff as a favorable outcome. But the sentiment’s popularity among the president’s base, coupled with the president’s my-way-or-the-highway proposals, hints that the Obama already has most of what he wants through last year’s delayed deficit-reduction agreement that has become known as the fiscal cliff.

Speaker of the House John Boehner may lament the bargaining position in which he finds himself. But he shouldn’t forget that he put himself there. When the Speaker of the House held the cards during the summer of 2011 debt-ceiling negotiations, he traded Republican votes supporting an increased debt-ceiling for a deficit-reduction plan that relied primarily on tax hikes and defense cuts. Put another way, he agreed to give the president what he wanted (the power to borrow more money) in exchange for more of what the president wanted (defense cuts and tax hikes). Boehner’s adversary has the cards because he handed them to him.

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