'World's Worst Poker Player': Obama Readies Gift for GOP

President refuses to hold his line as clock ticks in Washington


As rumors of a 'deal' continue, a new Paul Krugman post on Obama's 'dealmaking':

{...} Anyone looking at these negotiations, especially given Obama's previous behavior, can't help but reach one main conclusion: whenever the president says that there's an issue on which he absolutely, positively won't give ground, you can count on him, you know, giving way -- and soon, too. The idea that you should only make promises and threats you intend to make good on doesn't seem to be one that this particular president can grasp.

And that means that Republicans will go right from this negotiation into the debt ceiling in the firm belief that Obama can be rolled.

At that point he can redeem himself by holding firm -- but because the Republicans don't think he will, they will play tough, almost surely forcing him to actually hit the ceiling with all the costs that entails. And look, if I were a Republican I would also be betting that he'll cave.

So Obama has set himself and the nation up for a much uglier confrontation than we would have had if he had set a negotiating position and held to it.



President Obama, who announced at a mid-day televised announcement Monday that a possible fiscal agreement in Washington was close, appears ready to 'cave' on early promises that he would not allow an extension of Bush era tax cuts on those making more than $250,000 a year.

As rumors surfaced about the details of a possible deal being negotiated by Vice President Joe Biden and Republican Minority Leader Sen. Mitch McConnell, Paul Krugman called Obama the 'world's worst poker player,' writing:

Is it really possible that Obama still doesn't understand that every time [offers concessions to Republicans] -- especially if it comes just a few days after stern statements about how he won't give it -- it just reinforces the Republican belief that he can always be bullied into submission? If he cuts a bad deal on the fiscal cliff today, he more or less guarantees that just a few weeks from now Republicans will go all out on using the debt ceiling to extract more concessions.

Meanwhile, describing why Republicans think Obama is playing right into their hands and believe they'll come out on top today, the Washington Post's Ezra Klein writes:

[...] The question for Republicans has always been how to get to the debt ceiling while giving up the minimum in tax increases. Many of them figured that they'd at least have to give on the Bush tax cuts for income over $250,000.

When these negotiations began, the White House was unyielding on that point, with the president promising to veto anything that didn't raise tax rates for income over $250,000. Asked by House Speaker John Boehner what he'd trade for $800 billion in revenue -- about the cost of the high-income Bush tax cuts -- Obama was firm. "You get nothing," the president said. "I get that for free."

To make matters worse for Republicans, the Senate had already passed a bill letting those cuts expire back in July because Minority Leader Mitch McConnell figured it would be too politically damaging to block. If Mitt Romney had won the election, that bill would have died. But after Obama won on a platform that was barely about anything aside from letting those tax cuts expire, it seemed inevitable he'd get it done. It was his due.

To the GOP's delight, that no longer seems to be the case. In the Obama-Boehner negotiations, the White House offered to raise the threshold from $250,000 to $400,000. McConnell, in his negotiations with Harry Reid and now Joe Biden, has been trying to raise that to $500,000. It's clear to the Republicans that they will get past the fiscal cliff with a smaller tax increase than they thought. Perhaps much smaller. Huzzah!

Klein reports that Republicans who heard that Obama would refuse to negotiate over a future debt ceiling fight, "burst out laughing." Those Klein spoke to said the president--given today's developments--was already doing just that. Klein continues:

[Obama] began the fiscal cliff negotiations by saying he wanted a permanent solution to the debt ceiling. Then it was a two-year increase in the debt limit. Now he's going to sign off on a mini-deal that doesn't increase the debt ceiling at all. Does that really sound like someone who's going to hold firm when faced with global economic chaos? The White House always talks tough at the beginning of negotiations and then always folds at the end. Republicans are confident that the debt ceiling will be no different.

All this raises the tantalizing prospect for Republicans that they could end these negotiations having given up less tax revenue than they ever thought possible -- less tax revenue than Boehner offered Obama, even -- but still getting their entitlement cuts. Oh, and because there was never a big deal, they won't have to agree to much stimulus, either. All in all, a pretty big win, and it wouldn't have been possible without the White House's baffling inability to stick to a negotiating position.

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