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Posted by on Dec 29, 2012 in Breaking News, Economy, Featured, Politics | 10 comments

With Boehner Out, President and Senate Leaders Step In

After weeks of fruitless negotiations between the president and Speaker John A. Boehner, Mr. Obama turned to Senator Harry Reid, the majority leader, and Senator Mitch McConnell of Kentucky, the Republican leader — two men who have been fighting for dominance of the Senate for years — to find a solution. The speaker, once seen as the linchpin for any agreement, essentially ceded final control to the Senate and said the House would act on whatever the Senate could produce. …NYT

President Obama’s final offer is on the table. Now it’s up to Mitch McConnell to match it with a Republican offer. If McConnell fails, the Senate may vote on Obama’s offer, with $250,000 as the tax-cut maximum and unemployment compensation extended, putting Republicans on the line for blame if they refuse to sign. If the Senate Republicans come up with a workable compromise, House Republicans seem ready to pass it.

Boehner appeared to recognize that he was no longer dictating terms. According to the aide, the speaker said repeatedly, “Let us know what you come up with, and we’ll consider it — accept it or amend it.” ..NYT

So the Republicans know they have to come up with deal and there’s a certain amount of optimism — genuine optimism — that they will. But let’s not kid ourselves. This kind of last-minute deal pushes the real compromise into the new year.


The markets are, for the time being, optimistic.

Despite the fiscal gridlock in Washington, major stock indexes are holding on to gains for the year. The Dow is up 5.9 percent, the S. & P. 500 is 11.5 percent higher, and the Nasdaq is up 13.6 percent.

Stocks rose in 2012 on optimism that a recovery in the housing market, coupled with an improving job market, would support economic growth. The Federal Reserve had also extended its bond-buying program, which is intended to lower borrowing costs and encourage spending and investment.

While stocks declined on Friday, reports suggested the outlook for the economy was improving. ...NYT/AP


The Washington Post reports that a deal may be made — really! — before the New Year.

As the Senate began haggling over critical details, the emerging deal faced an uncertain fate in the House, where Speaker John A. Boehner (R-Ohio) failed just one week ago to persuade his adamantly anti-tax caucus to let taxes rise even for millionaires.

Still, on Friday, Obama pronounced himself “modestly optimistic” at a brief news conference at the White House. The ordinarily dour McConnell said he was “hopeful and optimistic.” And Reid immediately began preparing Senate Democrats for what could be a difficult vote.

“Whatever we come up with is going to be imperfect. Some people aren’t going to like it. Some people will like it less,” Reid said on the Senate floor before dozens of silent and attentive senators from both parties. But “we’re going to do the best we can for .?.?. the country that’s waiting for us to make a decision.” …WaPo

It’s notable that the most Republicans can offer at this point seems to be less self-involved expression on Mitch McConnell’s face. Democrats have at the very least remained aware of what Congress’s potential failure to act will do to the average wage-earner in America.


The “ouch” for Republicans could be really tough.

It’s possible, as many commentators are speculating, that today’s machinations mean Reid and McConnell really may reach a deal. But if not, by daring Republicans one last time to refuse to allow simple majority votes on extending the middle class tax cuts, Obama is signaling that if we do go over the cliff, he intends to extract maximum political pain for it. …Greg Sargent, WaPo

They were already hurting after the election failure. Hurting bad. Their “fiscal cliff” failure only deepens the wound.

Provoking a crisis is bad politics: Republicans are resigned to taking the blame. And it’s bad for their policy agenda: They will likely be cornered into a broader tax hike than the best deal they could get from President Barack Obama today, and with none of the spending cuts that might now be on the table.

And yet, the dominant emotion among most Republicans here is one of sheer resignation.

“It’s a shit show,” one prominent Republican told BuzzFeed of the GOP’s messaging position. “Tax rates are going to go up on everyone, and we’re going to get the blame.”President Obama has already snatched back the outlines of a deal he offered House Speaker John Boehner last year, pulling back from considering certain entitlement cuts. If the Bush tax cuts are allowed to expire for all taxpayers, Republicans believe Obama will move the goal posts again, and refuse to negotiate on raising the eligibility age for Medicare or chained-CPI — an accounting tool many economists believe is more accurate than current measures of inflation, and would have the effect of slowing the growth of Social Security benefits.

“There’s a group of people waiting for the soul searching to begin until after we take this really shitty vote, whatever it is,” said a top Capitol Hill Republican. …Buzzfeed

The problem: without a Republican president, the leadership of the party falls to McConnell and Boehner. Each is talented in his own way. But they aren’t effective party leaders. Now Boehner, though he’s unlikely to loose his position of Speaker, has been considerably weakened.


Republicans may be hoist with their own petard. In this case hoist with their very willful, Rovian gerrymandering.

So why is compromise so hard in the House? Some commentators, especially liberals, attribute it to what they say is the irrationality of Republican members of Congress.

But the answer could be this instead: individual members of Congress are responding fairly rationally to their incentives. Most members of the House now come from hyperpartisan districts where they face essentially no threat of losing their seat to the other party. Instead, primary challenges, especially for Republicans, may be the more serious risk. …Nate Silver

That insight may be a hint that historians will blame Karl Rove (&Co.) and just plain ignorance for the self-destruction of the early 21st century Republican party. Being clever enough to put unchallenged wankers in Congress isn’t any better for your party than it is for the country.


Cross-posted from Prairie Weather

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Copyright 2012 The Moderate Voice
  • sheknows

    “Most house Republicans now come from hyperpartisan districts where they face no threat of losing seats”. Perhaps that is true.

    The Republicans I know don’t really care if they raise the taxes on the wealthiest, just as long as they slash the hell out of entitlement programs.
    It isn’t really about what is good for the nation, or about the lower and middle classes ( even though the majority of Republicans are in southern states with the highest concentration of poverty and most of those people on welfare, SS, and heavy users of entitlement programs.) They are more concerned with ” sticking it to the Dems” even though it may cut their own throats in the process.

  • ShannonLeee

    Further proof that the House is a loony bin.

  • zephyr

    For a long time now the only real motivation of the GOP is hate of all things moderate and liberal, regardless of what is or isn’t in the best interest of the country. By all rights this diseased mentality should be their undoing but since roughtly half the electorate is similarly diseased I’m not expecting any miracles. I’d enjoy being surprised though.

  • sheknows

    An interview I saw once with a southern white family in Louisiana absolutely astounded me. It was before the first Obama election, and the mother said she would not want to see a Democrat in the White House, no matter what. She had all the views you might expect about how “evil” they were and “just threw money away” and” wanted to keep God out of our lives.”
    As the interview progressed, it came to light that she and her children were on “public assistance” and her father was living with them and on social security.
    How can people be educated to understand what the parties believe in? I am thinking now that probably >75% of ALL Republicans haven’t a clue.

  • petew

    The article and the following posts say it all. But Republicans aren’t deserving of pity for their own folly. That’s what happens when you announce that your number one goal is confined to bringing down the President—no matter what he may propose! However, Boehner does deserve a bit of compassion. It seemed all along that he would have come up with a workable compromise much earlier, if not chained to the political narcissism of the tea party.

    Even going over the fiscal cliff is far preferable to Democrats than being continually black mailed over routine procedures like raising the debt limit! And, Obama like most Presidents, understands the danger of negotiating with terrorists!

  • KP

    Am I the only one who sees irony in a Democratic President trying to save tax cuts drafted by a Republican President?

    Every progressive I know has been yelling to do away with the Bush tax cuts for eight years. What the heck? You can laugh or cry at silly Repubs (as I do) but the far left is also baffling.

  • StockBoyLA

    The way Boehner is acting I’d say he doesn’t want his job.

    BTW KP:, you’re not alone anymore!

  • sheknows

    KP, I think they were yelling to do away with the tax cuts on the wealthy.

  • KP

    sheknows, refresh your memory. Your claim is a recent re-election mantra. Senator/President Obama and other tax and spend progressives have had a mission since Bush cut taxes across the board; that is; reinstate taxes to the Clinton era (at a minimum) — across the board. To be clear, I am in favor of across the board Clinton era tax rates. We have a progressive tax system. What is not fair is singling out one group. I am part of the population who earns less and would be affected. I am okay with that. What happened to progressives? Why all of a sudden the “you but not me” mentality?

  • sheknows

    Well, it sounds like they just needed something to complain about until we had the fun and excitement of a new election.
    Actually I see no irony in trying to save cuts in taxes by a Dem president after the horrendous financial disaster to the economy caused by a Rep one. 🙂

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