Legal Commentary

The Deal Was Bad Politics

By Big Tent Democrat

Paul Krugman writes:

Republicans aren’t the only cynics. As the national debate over fiscal policy descends ever deeper into penny-pinching, future-killing absurdity, one voice is curiously muted — that of President Obama.

The president and his aides know that the G.O.P. approach to the budget is wrongheaded and destructive. But they’ve stopped making the case for an alternative approach; instead, they’ve positioned themselves as know-nothings lite, accepting the notion that spending must be slashed immediately — just not as much as Republicans want. Mr. Obama’s political advisers clearly believe that this strategy of protective camouflage offers the president his best chance at re-election — and they may be right.

Krugman, like every one else it seems, forgets about The Deal. Once Obama let loose the Catfood Commission, DEFICITS!!!! were going to be what the Very Serious Persons would want to talk about. I stupidly surmised at the time that Obama was shrewdly going to use the Catfood Commission in order to raise taxes on the rich in December. The Deal shattered my naivete. Now when we talk about DEFICITS!!! the question is how much sacrifice are the poor and the middle class going to share (the rich of course never have to sacrifice, only the "little people" have to "share sacrifice.") More . . .

In doing The Deal, Obama took taxes off the table in the discussion of DEFICITS!!! This was bad policy and bad politics.

The worse policy in our current economy of severely depressed aggregate demand is to cut government spending. Raising taxes is certainly not the ideal policy prescription, but because DEFICITS!!! "concern," in no small measure because of Obama's Catfood Commission, is the paramount issue to all Very Serious Persons, DEFICITS!!! had to be addressed politically.

The Deal precluded tax policy from being a part of that discussion. Thus, Obama's approval of The Deal will lead to bad economic policy, which is unhelpful to his political fortunes, and bad politics, as the issue of taxing the rich, which is very helpful to Dems, has been taken off the table.

In case you don't know by now, I think The Deal was a terrible mistake.

Speaking for me only

Full post as published by TalkLeft on March 11, 2011 (boomark / email).