We're entering a crucial and potentially decisive period for the Obama administration, which is staring at two really lousy options and has about three weeks to decide how to respond. It can give in to congressional Republicans' demands for trillions in spending cuts in exchange for a debt-ceiling vote—but those are cuts that Ben Bernanke say will damage the economy. Or it can fight the Republicans and dare them to refuse to raise the limit. But these Republicans are crazy enough to do just that; sure it would cripple the economy and hurt ordinary people, but the fact that it would also hurt Obama is the only thing that counts for today's GOP. Between these two options, the administration has to choose the first. But it can do so sheepishly or aggressively, and which approach it takes will make a lot of difference to its alienated liberal base, and, I'd argue, to independent voters as well.
There's no question that Republicans are sitting in the catbird's seat. They control the House, and they have more than enough votes to block anything they wish in the Senate. This week, Senate Democrats are going to sit down and try to come up with a jobs-creation plan that they can live with and that can corral a few GOP votes. There won't be a nickel in spending or revenue. It'll just be more payroll tax cuts. And there's nothing the Democrats, who run the Senate but not at filibuster-proof levels, can do about it. And on the House side, when John Boehner says cuts agreed to in debt-ceiling negotiations have to be greater than the $2.3 trillion by which the ceiling must be raised, there's not much Democrats can do about that either.
But they—and chiefly, I mean Obama—can do something. They can at least tell the American people that while they're doing this for the sake preventing a wrecked economy, the cuts are far too severe. They can say that they're not giving up on their goal of making the better-off pay their fair share in taxes. They can and should say, point-blank, that the Republicans don't care if the economy is destroyed as long as it takes down the president with it. And finally and most of all, they can say that creating jobs is more important than reducing the deficit.
You'd think this would be a pretty easy call under current conditions, but apparently it's not. Two recent polls merely echo what virtually every poll I've ever seen since the start of the Great Recession—that people are far more worried about jobs than about the deficit. A FoxNews poll from May has jobs at 50 percent and the deficit at 22 percent. Meanwhile, a CBS News poll from this month shows jobs at 48 percent and the deficit at 10 percent. And yet, as we learned (or re-learned) in a recent Washington Post profile of Tim Geithner, the Treasury secretary's deficits-first thinking has, depressingly, won the day in the West Wing and, presumably, with the president himself.
As I indicated above, the Democrats have little choice but to go along with GOP cuts. But they have an awful lot of choice with regard to how they talk about those cuts. At crucial points, Obama and his people have done this badly. Back at the time of the 2009 stimulus bill, Obama, Christine Roemer, and others basically said that it would keep unemployment under 8.5 percent. Instead, the administration should have been saying: good start, probably not enough, but we'll see. Then, if it didn't fix things (which it certainly didn't), the president could easily have shifted blame to the GOP for its inadequate size.
Then we had the episode just this past March, when Obama accepted $38 billion (later revised downward, but this wasn't known at the time) in GOP-led cuts to avert a government shutdown and then made a video all but boasting about it. Again, saying he didn't like these cuts and still supported raising taxes on the wealthy (which polls extremely well) would have at least allowed the president to clarify that he and his party have different priorities from the Republicans.
The liberal base is awfully dispirited right now, and independents think, not entirely incorrectly, that Republicans are leading the president around by the nose. He can show some spine to both groups by letting America know that this debt-hostage situation isn't his idea of responsible governance—and by saying that his primary concern is jobs. If the administration cuts a deal that gives into 75 percent of GOP demands and he hails it as a victory for deficit reduction, it's going to be a bummer of a summer for the Americans on whom Obama's reelection fundamentally depends.