Fiscal cliff notes 12/18
by digby
Watch Peter DeFazio explain the chained CPI:
Matt Yglesias (who, by the way, is writing really excellent stuff on this issue) points this out as well:
In addition to the substantive objections that members of Congress may have to any kind of fiscal deal, you should never forget about the politics part of politics. Cutting Social Security benefits slightly is wildly popular with Pete Peterson, Pete Peterson's son, the Peter G. Peterson Foundation, and a broad array of groups funded in whole or in part by the Peter G. Peterson Foundation. But as today's Washington Post poll shows, it's broadly unpopular with the American people since as a pure cash transfer it's essentially a waste-free program and since retirement programs—unlike targeted programs from the poor—gain public support from white ethnocentrism rather than losing support.
It's hard to know what's going on with all this at this moment. We know Pelosi signed off and Reuters is saying that Cantor's got the votes for something:
(I'd have to guess that he's talking about Boehner's "plan B" to raise taxes on millionaires and adjourn until the New Year. but I don't know.)
The problem in all this is, once again, the president has shown his hand and given up what he's willing to deal. Or, as Ezra puts it:
The question inside the White House now is what’s behind Boehner’s “Plan B”? Is he trying to show nervous conservatives that he’s playing hardball? Or is Boehner signaling that he can’t go any further and is now preparing to bolt the talks if the White House doesn’t make further concessions?
There are also some who think that Boehner — and, more to the point, Boehner’s House members — increasingly see weakness in the White House’s negotiating position.
A few weeks ago, the Obama administration was firm that they wouldn’t budge on tax rates for income above $250,000 and that they wouldn’t budge on the debt ceiling. They’ve since budged on both. Republicans increasingly think the White House will concede more now, and that if they don’t concede more now they’ll definitely give Republicans a better deal if threatened with debt default. Whether or not that’s true, it pulls Republicans — and Boehner — to the right, as it makes it harder for Boehner to argue for a compromise now
Meanwhile, the White House has problems within their coalition, too. Their allies are disappointed to see an old dynamic reasserting itself: The president makes concessions, thinking he’s close to a deal, and then the Republicans pocket those concessions, offering nothing but renewed threats to blow up the talks in return.
“This fight is not going to be won by the president taking a step towards Boehner, Boehner taking a step toward the president, the president taking a step toward Boehner, Boehner taking a step toward the president and so forth until they meet in the middle,” says Damon SIlvers, policy director at the AFL-CIO. “That hasn’t worked before. Boehner doesn’t take the steps. It will be won by the president clearly siding with the American people on tax fairness and preserving the safety net from benefit cuts.”
They also feel that the White House is weakening their hand if the negotiations fall apart and the president needs to win a battle for public support. “They ought to be in a position where they say to Boehner, ‘You’re the guy demanding benefit cuts and you’re using them to fund tax cuts on the rich,’” Silvers says. Cutting Social Security’s cost-of-living adjustment by chaining CPI, he says, “muddies that position. It shouldn’t be muddied. It should be clear.”
Worse, the pushback from congressional Democrats over chained CPI is stronger than the administration expected — note the outspoken opposition from Sen. Dick Durbin, an Obama ally who’s often considered a barometer for pragmatic liberals.
Well played ...
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