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As Shutdown, Default Loom What Might Obama Give Away?

With the focus on the GOP's internal fracturing, could 'Grand Bargain' slip through the cracks?

- Jon Queally, staff writer

Barack Obama delivers a statement on the budget, a possible US government shutdown and foreign policy. (Photograph: Michael Reynolds/Pool/EPA)As the Republican caucus in the House of Representatives now faces a decision on how to deal with the budget stopgap bill approved by the Senate on Friday, most commentators are asking whether or not the country can avoid a government shutdown as Tea Party-aligned members of the House GOP continue to signal their refusal to pass any budget measure that funds programs related to the implementation of the Affordable Care Act, aka Obamacare, key portions of which are set to begin Tuesday.

In addition, lingering behind the threat of a temporary government shutdown is the possibly more severe tactic being considered by the GOP "hostage-takers" who—once again—are saying they will not approve an increase to the federal debt limit if a series of their economic proposals and budget demands are not met. If the so-called 'debt ceiling' is not raised by Congress, warn experts, the U.S. will be voluntarily defaulting on its debt obligations to its creditors and the result could be deeply destructive to the credit-rating of the U.S. and cause a new wave of financial pain in a still faltering economy.

These dual and competing threats by the Republican lawmakers, however—and the legislative processes and machinations of Washington, DC politics that many in the media are focused on—tend to miss out on asking one of the key questions at the center of this latest episode in what has become the "new normal" of lawmaking during the his presidency: Will Obama cave?

Though the president has repeatedly said he will "not negotiate" under these circumstances, it's clear from GOP lawmakers that their reading of history shows that if they push enough, take hostages, and make belligerent demands for the sun, that the president might at least give them the moon.

As The Hill reports:

President Obama on Friday said negotiating with Republicans on the government funding bill would only give them incentive to use the debt-ceiling and any future expiration of government funding as bargaining chips.

“The bill that's designed to avert a government shutdown basically just funds the government for another couple months, so we could be doing this all over again,” he said. “I'm sure the American people are thrilled about that. And that's why we've got to break this cycle.”

However, what was the lesson that GOP lawmakers took from the last showdown over the budget? If one forgets, following a scenario very similar to the current one that took place in 2012, President Obama offered to "not negotiate" by handing the Republicans cuts to key social programs—including Medicare and Social Security—in exchange for a conciliatory budget deal.

In fact, some progressive commentators, including Common Dreams contributor Jeff Cohen, argued that those describing Obama's repeated "caving" to Republican demands were using the wrong word. Cohen wrote at the time:

The accusations [of "caving"] imply that Obama is on our side. Or was on our side. And that the right wing is pushing him around.

But the evidence is clear that Obama is an often-willing servant of corporate interests -- not someone reluctantly doing their bidding, or serving their interests only because Republicans forced him to.

Since coming to Washington, Obama has allied himself with Wall Street Democrats who put corporate deregulation and greed ahead of the needs of most Americans.

Regardless, a so-called 'Grand Bargain' became the talk of the town, but few consistently argued that what it amounted to was a victory for the Republicans who used hostage tactics to make political gains despite their minority status in Washington. And as the Campaign for America's Future fellow Richard Eskow wrote this week, the current situation carries all the same signatures:

It’s autumn, when a politician’s fancy turns to thoughts of a Grand Bargain.

Right now it looks as if the two sides are at an impasse. But President Obama’s “no negotiations” posture only applies to the debt ceiling, and his budget still includes the “chained CPI” cut to Social Security. The Republicans who are attempting to force a showdown over Obamacare are still railing against the programs they call “entitlements.”

They’re all looking for a face-saving deal, and Social Security and Medicare could very well become that deal’s Ground Zero.

In fact, as The Guardian reports, Obama on Friday said "he was willing to negotiate over government spending," despite his refusal to respond to a laundry list of other GOP demands.

But if a reduction in spending on key programs continues to be on the chopping block, why wouldn't the Republicans continue their push? As events unfold in the coming days, it might just become more clear what "not negotiating" with "hostage-takers" look like. And it's unlikely to be pretty.

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