No more bargaining chips

No more bargaining chips

by digby

So that's that:

Stunning news from WaPo's Ezra Klein: The Treasury is ruling out the use of a trillion dollar platinum coin to break the debt ceiling impasse.
Klein writes:
That’s the bottom line of the statement that Anthony Coley, a spokesman for the Treasury Department, gave me today. ”Neither the Treasury Department nor the Federal Reserve believes that the law can or should be used to facilitate the production of platinum coins for the purpose of avoiding an increase in the debt limit,” he said.
With this, the White House has now ruled out the two best options for preventing a default in the event that the House GOP refused to life the debt ceiling. The White House has been quite adamant that the other alternative (invoking the 14th Amendment) is not acceptable.

So now the stakes are high, as The White House has refused to negotiate with the GOP on a debt ceiling hike.

What bargaining chips does The White House hold? Unclear.

Not unclear. They now have no bargaining chips and see no good reason to even pretend they have some.

Sooo, either the administration is going to hold on with more steely-eyed grit than they've ever shown before to try to get the Republicans to blink (which considering past negotiations, one could not blame the GOP for scoffing at) or they are eager to engage in more high stakes deficit reduction "negotiations."

Golly, I wonder what's going to happen?

Greg Sargent reported the other day that the Republicans have been hedging on the debt ceiling and that this emboldened the White House to hold fast and make no concessions. I replied:

It sure sounds like Boehner and McConnell are hedging to me too. If they are,then that means any more "offers" from the Democrats to make a "big deal" are offers the Democrats want to make, not ones they have to make.

I'm not sure withdrawing the threat of the coin or the 14th Amendment remedies qualifies as an offer in that context. But since they've thrown away their only bargaining chips before they even started, it's fair to say that anything they agree to from now on should be seen as something they wanted, not something they needed.

But I'm sure that Ruth Marcus and David Gergen will be greatly impressed by their seriousness and maturity and that's really all that matters.


Update: Krugman