Obama Losing Policy, Winning Politics Of Debt Ceiling Fight

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JONATHAN CHAIT JULY 20, 2011

Obama Losing Policy, Winning Politics Of Debt Ceiling Fight

I've been pretty critical of President Obama's strategy on the debt ceiling negotiations, and the whole saga could well end in economic disaster, bad long-term policy, or both. That said, I must concede that Obama has, largely through ideological retreat, maneuvered the debate onto terrain where he holds the public opinion high ground. Consider this question from the latest WSJ/NBC poll:

Which of the following approaches being considered in Congress to deal with the Federal debt ceiling are you more likely to support? (ROTATE)

A proposal by President Obama which would reduce the Federal deficit by four TRILLION dollars over  the next decade by cutting federal spending, increasing taxes on corporations and the wealthy, and reducing the level of spending on Medicare

…Or…

A proposal by Republicans  in Congress  which would reduce the Federal deficit by two and a half  TRILLION  dollars over the next decade by cutting Federal spending and would not raise taxes on corporations or the wealthy

President Obama's proposal........................ 58

Republicans in Congress proposal............... 36

  Either (VOL)................................................ -

  Neither (VOL) ............................................. 2

  Not sure...................................................... 4

That question wording actually stacks the deck a bit in the GOP's favor, by identifying Obama's position as reducing spending on Medicare while, oddly, failing to say the same about the Republican budget. Yet Obama's position still commands a twenty point margin. The two subsequent questions ask whether Democrats in Congress should compromise on their unwillingness to "make cuts and changes" in Social Security and Medicare in return for lifting the debt ceiling, and then whether Republicans in Congress should agree to raise taxes. By a 52-38 margin, people say Democrats should not compromise on that issue, and by a 62-27 margin, they say Republicans should compromise.

Obama has narrowed the terms of debate to the Republican Party's position that it will risk economic catastrophe by refusing to lift the debt ceiling because it won't accept closing tax expenditures for the rich, even in exchange for much larger spending cuts. A Washington Post/ABC poll also has some striking data:

While Republicans in Congress have remained united in their opposition to any tax increases, the poll finds GOP majorities favoring some of the specific changes advocated by the president, including higher income tax rates for the wealthiest Americans. ...

A majority view the president as more committed to protecting the interests of the middle class and small businesses, while large majorities see Republicans as defending the economic interests of big corporations and Wall Street financial institutions.

Exposing the GOP's obsession with preserving Bush-era tax cuts for the rich has framed the debate in overwhelmingly positive terms for Obama.

How isolated in the Republican party's position here? This isolated:

A few wealthy donors have called Cantor to tell him they wouldn’t mind if their taxes are raised. During two closed meetings this week — one with vote-counting lawmakers, and another with the entire conference — Cantor told colleagues that some well-heeled givers have told them they’re willing to pay more taxes. Cantor, according to an aide, has responded that House Republicans aren’t standing up for the wealthy, but rather for the middle class, who want to see their taxes stay low.

Of course, that's totally false.

In the big picture, this isn't terrific news for liberals. It's another case of a now-familiar Democratic tactic -- cooperating with a massive rightward shift in the terms of debate, and eking out a political victory by occupying right-of-center ground while Republicans occupy the lunatic fringe. That said, the pure politics of this episode appear to be a rout.

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posted in: jonathan chait, nbc, president obama, congress, medicare, republican party

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