President Obama's Presser: An Ultimatum And Invitation

I know you've probably already read about the president's press conference, because my friends John Amato and Susie Madrak have already written about it. If you haven't read theirs, you should, and you should also read Mike Lux' analysis of the

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I know you've probably already read about the president's press conference, because my friends John Amato and Susie Madrak have already written about it. If you haven't read theirs, you should, and you should also read Mike Lux' analysis of the issues surrounding the deficit.

These are people I deeply respect, but I confess that I simply did not hear the same messages in the press conference that they did. In fact, I heard something completely different.

On the Grand Bargain

What I heard was that the president was done with efforts to find a Grand Bargain. He expressed his concerns about the deficit, yes. But he also left the negotiating table. Here's the key moment, in the Q & A session with Major Garrett asking the question:

MAJOR GARRETT: Thank you, Mr. President. As you well know, sir, finding votes for the debt ceiling can sometimes be complicated.

You, yourself, as a member of the Senate, voted against a debt ceiling increase. And in previous aspects of American history — President Reagan in 1985, President George Herbert Walker Bush in 1990, President Clinton in 1997 — all signed deficit reduction deals that were contingent upon or in the context of raising the debt ceiling. You, yourself, four times have done that. Three times, those were related to deficit reduction or budget maneuvers.

What Chuck and I and I think many people are curious about is this new, adamant desire on your part not to negotiate, when that seems to conflict with the entire history in the modern era of American Presidents and the debt ceiling, and your own history on the debt ceiling. And doesn’t that suggest that we are going to go into a default situation because no one is talking to each other about how to resolve this?

THE PRESIDENT: Well, no, Major, I think if you look at the history, getting votes for the debt ceiling is always difficult, and budgets in this town are always difficult. I went through this just last year. But what’s different is we never saw a situation as we saw last year in which certain groups in Congress took such an absolutist position that we came within a few days of defaulting. And the fact of the matter is, is that we have never seen the debt ceiling used in this fashion, where the notion was, you know what, we might default unless we get 100 percent of what we want. That hasn’t happened.

Now, as I indicated before, I’m happy to have a conversation about how we reduce our deficits further in a sensible way. Although one thing I want to point out is that the American people are also concerned about how we grow our economy, how we put people back to work, how we make sure that we finance our workers getting properly trained and our schools are giving our kids the education we deserve. There’s a whole growth agenda which will reduce our deficits that’s important as well.

But what you’ve never seen is the notion that has been presented, so far at least, by the Republicans that deficit reduction — we’ll only count spending cuts; that we will raise the deficit — or the debt ceiling dollar for dollar on spending cuts. There are a whole set of rules that have been established that are impossible to meet without doing severe damage to the economy.

And so what we’re not going to do is put ourselves in a position where in order to pay for spending that we’ve already incurred, that our two options are we’re either going to profoundly hurt the economy and hurt middle-class families and hurt seniors and hurt kids who are trying to go to college, or, alternatively, we’re going to blow up the economy. We’re not going to do that.

That was a clear signal to me that the president is done trying to mash up budget resolutions, tax reform and the debt ceiling. It sounds to me like he was saying plain and flatly that nothing other than a clean, reasonable increase on the debt ceiling will be acceptable. Further, he acknowledged the progressive argument advanced in John Amato's post that the real solution to the deficit is economic growth. In other words, he acknowledged that the deficit issue is a Republican flog, and Americans have something else on their minds.

He reinforced that later in the Q&A session when he said this, which I found to be the strongest gesture that he expected these things to be dealt with in an orderly fashion, beginning with a clean debt ceiling vote, in response to Julianna Goldman's question:

THE PRESIDENT: No, Julianna, look, this is pretty straightforward. Either Congress pays its bills or it doesn't. Now, if — and they want to keep this responsibility; if John Boehner and Mitch McConnell think that they can come up with a plan that somehow meets their criteria that they’ve set for why they will — when they will raise the debt ceiling, they're free to go ahead and try. But the proposals that they’ve put forward in order to accomplish that — only by cutting spending — means cuts to things like Medicare and education that the American people profoundly reject.

Now, if they think that they can get that through Congress, then they're free to try. But I think that a better way of doing this is go ahead and say, we’re going to pay our bills. The question now is how do we actually get our deficit in a manageable, sustainable way? And that's a conversation I’m happy to have.

  1. John Boehner and Mitch McConnell are free to try and get something through Congress, but they will have no assistance from the White House.
  2. There will be no approval from the White House on proposals that simply gut Medicare, education and other social safety nets, because that goes against what the American people want.
  3. Whatever they might try to do with deficit reduction has nothing to do with the debt ceiling.

The invitation

The president also invited people to use their voices to pressure Congress. It was subtle and almost easy to miss, but still there in his answer to Matt Spetalnick:

But it seems as if what’s motivating and propelling at this point some of the House Republicans is more than simply deficit reduction. They have a particular vision about what government should and should not do. So they are suspicious about government’s commitments, for example, to make sure that seniors have decent health care as they get older. They have suspicions about Social Security. They have suspicions about whether government should make sure that kids in poverty are getting enough to eat, or whether we should be spending money on medical research. So they’ve got a particular view of what government should do and should be.

And that view was rejected by the American people when it was debated during the presidential campaign. I think every poll that’s out there indicates that the American people actually think our commitment to Medicare or to education is really important, and that’s something that we should look at as a last resort in terms of reducing the deficit, and it makes a lot more sense for us to close, for example, corporate loopholes before we go to putting a bigger burden on students or seniors.

But if the House Republicans disagree with that and they want to shut down the government to see if they can get their way on it, that’s their prerogative. That’s how the system is set up. It will damage our economy.

The government is a big part of this economy, and it’s interesting that a lot of times you have people who recognize that when it comes to defense spending — some of the same folks who say we’ve got to cut spending, or complain that government jobs don’t do anything, when it comes to that defense contractor in their district, they think, wow, this is a pretty important part of the economy in my district and we shouldn’t stop spending on that. Let’s just make sure we’re not spending on those other folks.

In other words, House Republicans can go ahead and blow everything up if they really think that's what they were elected to do, but it would appear that they were not elected to do that, and so their constituents should speak up.

For the rest of January and into February, President Obama has the bully pulpit. He has an inaugural speech coming up next Monday, and a State of the Union speech coming up the following month. He has the benefit of winning the last election by over 5 million votes, and he has the message that resonates with Americans on many levels.

I did not in any way, shape or form hear him say he wanted a Grand Bargain. I heard him say he wants a clean debt ceiling raise with no negotiating or bargain. Period. I heard him say that while he views deficit reduction as something to pay attention to, we've already tackled a chunk of the deficit reduction issue by $2.5 trillion in spending cuts and increased taxes, that this Congress is incapable of being reasonable, and he's done with the Grand Bargain game. While it's true that he mentioned the Grand Bargain in his introduction, he also did it in the past tense, which to me meant he's done with the bargaining and has moved into action mode.

Here's my question: What happens if they pass a debt ceiling increase loaded with cuts that do harm to Medicare and Medicaid and that somehow gets through the Senate? That would place him in an untenable position, where we all would wish that Grand Bargain had been struck. I worry that they're trying to maneuver him into vetoing their bill so they can have their choice of people to blame: him or the Senate. In reality, I would expect the Senate to reject any debt ceiling increase that wasn't clean, but it would still fall on the head of Democrats in that situation.

Key Republicans are beginning to make some critical statements to their side of the aisle. Frank Luntz' remarks about how they should abandon the hostage-taking over the debt ceiling were very telling, and even Peggy Noonan, incoherent as she is, also says the same thing. If they couldn't bring themselves to see the fiscal cliff from the other side of January 1st, I doubt they (or their billionaires) want the entire global economy on the brink.

It's interesting how all of us can watch the same things and take out different points. To me, the President said the time for bargains are behind us. Others heard an appeal for a Grand Bargain.

In the end, I think the purpose of this press conference was to educate the public about what the debt ceiling is, why it must be raised, and why it is unrelated to any discussion of deficit reduction.

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