Fiscal Cliff Hostage Situation Day 28: Ennui Sets in
Fiscal cliff hostage situation. Day 28. As often happens in hostage situations, a sense of ennui enveloped the participants. The hopes that a formal Republican offer, extended by House Speaker John Boehner on Monday, would kick negotiations into higher gear proved out to be false. The two protagonists didn’t meet. The stock market, that finely tuned barometer of reality and predictor of future events, pronounced itself utterly bored with the proceedings. The Dow Jones Industrial Average ended down 13.82 points, off 0.11 percent.
But the day wasn’t completely uneventful. President Obama sat for an interview with Bloomberg Television, which caused thousands of people who don’t live in the Acela corridor to turn to each other and ask, “What’s Bloomberg Television?” Obama, emboldened by his election victory, stood his ground. The Republican offer, he said, was unacceptable because it didn’t raise rates on the highest earners and because the math didn’t add up. He did offer something of an olive branch. Some time next year, he said, he could “look at what loopholes and deductions both Democrats and Republicans are willing to close, and it’s possible that we may be able to lower rates by broadening the base at that point.” But that would take place only after rates on the wealthy had risen.
Elsewhere in Washington, the Republican circular firing squad began to assemble. Many conservatives were upset with Boehner’s offer to raise revenues by $800 billion as part of a deficit reduction deal. “Speaker Boehner’s $800 billion tax hike will destroy American jobs and allow politicians in Washington to spend even more, while not reducing our $16 trillion debt by a single penny,” thundered Sen. Jim DeMint of South Carolina. The Heritage Foundation complained, “It is bad policy, bad economics, and, if we may say so, highly questionable as a negotiating tactic.”
Some Republicans pronounced themselves horrified with the contents of Boehner’s proposal. Democrats, for their part, pronounced themselves flummoxed with the lack of content in Boehner’s proposal. For example, while the speaker said he could live with $800 billion raised through capping or eliminating deductions, he didn’t specify a single deduction he would cap or eliminate. As Obama noted to Bloomberg: “When you look at how much revenue you can actually raise by closing loopholes and deductions, it’s probably in the range of $300 billion to $400 billion. That’s not enough to come up with a balanced plan that actually reduces the deficit and puts us on the path of long-term stability.” The lack of specificity led White House spokesman Jay Carney to dub the plan “magic beans and fairy dust.” (Coincidentally, Magic Beans and Fairy Dust is the name of a new coffee shop in Williamsburg, Brooklyn.)
So as night fell on Day 28 of the Fiscal Cliff Hostage Situation, the press was left pondering existential questions. If there is no picture documenting a meeting of the president and his chief negotiator at the White House Christmas party, did they actually meet? And if you submit a “plan” to increase revenues but it doesn’t explain how you will increase revenues, is it still a plan?
Meanwhile, troubling evidence emerged that the president may not be a man of his word. He told Bloomberg, in response to a question about the Susan Rice controversy: “I—you know, I don’t really spend a lot of time on, you know, what folks say on cable news programs.” But evidence quickly emerged that he does. Tuesday afternoon, Obama held a meeting with a bunch of folks who appear on cable news programs, including Arianna Huffington and several MSNBC hosts.