Tuesday, November 22, 2011

Super Committee Failure: Win for Obama?

I think so.  Obama can (and is) distancing himself from an unpopular Congress all the while painting the Republicans as intransigent on the revenue side of the "compromise" negotiations.  That can only be good for Obama.  Besides which, his very clear intent to exercise a veto if the Congress tries to weasel its way out of its own impotence by "renegotiating" the trigger is a little bit of brilliance, if you ask me.

Whatever I might think about which side is responsible for the Super Committee's failure, I certainly don't think Congress has the capacity to come up with a compromise.  And now they've boxed themselves into a corner with the default trigger likely to kick in.

Although this means heavy cuts to entitlement programs and the defense budget, we should also not forget that it also means the expiration of the Bush tax cuts.

And this is where I think it gets really good for Obama.  I think Obama will campaign as if the Bush tax cuts will certainly expire, and that he will respond to the expiration of the tax cuts by putting forward his own plan that will maintain these cuts for any individual making $200,000 or less (or any family making $250,000) and letting the cuts expire for those earning more than this.  He will also note how far this will go towards reducing the deficit.

In short, the failure of the Super Committee gives Obama plausible cover for steep cuts to entitlement programs in his veto of any legislation seeking to weasel out of the trigger; and that cover gives him leverage to campaign on his willingness to make deep cuts towards controlling the deficit.  Furthermore, by holding the Congress to the trigger, Obama gets to highlight his alternative plan to further reduce the deficit by having the Bush tax cuts expire and championing a stand alone middle class tax cut in its place that will be hard for Congressional Republicans, and the Republican nominee for President, to oppose.

As Andrew Sullivan would say: "Meep, meep!"

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