Is Obama winning the debt-limit fight?

Washington Bureau

Has President Obama seized the upper hand in the debt-limit debate? Mark Salter, for years a top advisor to Republican Sen. John McCain of Arizona, said Wednesday that he has, that Obama has “outmaneuvered” congressional Republicans by appearing more daring on fiscal reforms -- and that the GOP had best find another strategy.

His assertion in an Op-Ed article for Real Clear Politics, comes a day after Sen. Mitch McConnell of Kentucky, the Senate minority leader, offered a complex legislative scheme that many viewed as a concession that no deal can now be struck with the White House and that the GOP must instead find a graceful way to rain as much political collateral damage on the president as possible while ensuring there is no default on the nation’s debt obligations.

In his article, Salter, who was instrumental in McCain’s 2008 presidential run and who has never been known for lukewarm opinions, wrote that House Speaker John Boehner should not have walked away from the opportunity that the so-called grand bargain handed the GOP. That, he said, effectively ceded the high ground to the president.

“If the ‘grand bargain’ he proposed to John Boehner, and which the speaker seemed briefly inclined to consider seriously, is even close to what has been leaked to the press then it was a deal worth taking seriously,” Salter wrote. “Three trillion dollars in spending cuts, entitlement reforms that include changing the formula used to calculate Social Security cost-of-living increases, and raising the eligibility age for Medicare are a fair exchange for a tax reform deal that reduces the corporate income tax rate and makes other pro-growth changes to the tax code while also closing loopholes, raising ‘user fees’ and other tax increases that would result in increased revenues of some $1 trillion to the depleted U.S. Treasury.”

As a result of the Republicans’ refusal to engage in large-scale talks, “Obama has, or at least appears to have, put on the table a proposal that seems practical, reasonable and bold -- and which made Republicans appear truculent and small,” Salter said.


Regardless of whether Salter is right, one of the things that has had Republicans in Washington seething is their widely held belief that it was the GOP that forced Obama to become serious about debt and deficits. They point to the first budget offered by the White House for 2012, one that made no attempt to shrink the deficit.

Conservative columnist Charles Krauthammer last week assailed Obama on his fiscal record, but he then essentially nodded to what he saw as a smart political play: force Republicans to make the first move on entitlement reform (as they did with the Paul Ryan budget in the House), blast them for it politically, then appear to try to do it himself in a more “responsible” way.

“A clever strategy it is: Do nothing .... ; Invite the Republicans to propose real debt reduction first; and when they do -- voting for the Ryan budget and its now infamous and courageous Medicare reform -- demagogue them to death,” he wrote.

“And then up the ante by demanding Republican agreement to tax increases. So: First you get the GOP to seize the left’s third rail by daring to lay a finger on entitlements. Then you demand the GOP seize the right’s third rail by violating its no-tax pledge. A full-spectrum electrocution. Brilliant.”

But Salter sees a party so laser-focused on taxes that it’s neglecting to tackle deficit reduction and secure the kind of concessions from Democrats that it has been demanding for years.

“In a divided government, which is more or less a constant feature of modern American politics, you will not succeed in balancing the budget and reducing the debt -- and you will surely not get Democrats to sign off on real Social Security and Medicare reforms -- without some concession on taxes,” he said in the Real Clear Politics article.

Obama showed Tuesday in an interview with CBS News that he isn’t going to be reluctant to use the presidential pulpit to assign the consequences of a potential default to the GOP. He told CBS’ Scott Pelley that a failure to reach a deal could cause a delay in Social Security checks being issued -- an outcome that many in Washington feel is unlikely regardless of whether an agreement is struck.

Still, the last 24 hours have seen some division in the Republican ranks on Capitol Hill. McConnell on Tuesday floated a legislative end-around that would ensure the nation doesn’t default on its debt while trying to pin the debt-limit increase solely on Obama and Senate Democrats. It would force Obama to submit multiple requests to Congress for raising the debt ceiling and likely require him to veto a Republican-backed denial of those requests. If the plan were to be adopted, it could have the benefit for Republicans of helping secure the Senate for the GOP in 2012.

But House Republicans believe they have a mandate to seek as massive a spending cut as possible as part of any debt deal -- and have pushed back against the McConnell plan, which has no provision for forcing cuts down Obama’s throat. His scheme was also viewed in some circles as a tacit admission that the president, indeed, stands to benefit from any deal reached with the GOP and that the minority leader is seeking to find a way out for his caucus.

For his part, Boehner has shifted his tack, trying to retake from Obama the high ground that Salter referred to in his Op-Ed article. The House speaker suggested Tuesday evening that the president has been grandstanding and has not been serious about seeking entitlement reforms as part of a deal.

“Where’s his plan?” Boehner said on Fox News. “We’ve talked about a lot of possibilities. He and I had conversations for a couple weeks. But we’ve never really seen the whole plan and what they’re really willing to do. ... They had some ideas, but they never would quite put them on paper. They talk about making substantive reforms in the entitlement programs but never could quite get there. That and the fact is they were continuing to insist on us raising taxes. I think it’s time for the president to put his plan on the table. Let’s let the American people see just what the president is proposing.”

Speaking of tables, both sides will be back around the big one at the White House on Wednesday afternoon, trying to reach a deal that, at least right now, appears more elusive by the day.