Why Lloyd Blankfein Calling Obama's Fiscal Cliff Plan 'Credible' Is A Big Deal

lloyd blankfein

Photo: CNBC screenshot

According to CNBC’s Katie Little, Goldman Sachs CEO Lloyd Blankfein characterised Obama’s fiscal cliff plan as “very credible” and expressed optimism about a deal getting done.This is actually a pretty important development for two reasons.

One, it means that Obama has a “plan.” Typically the knock on Obama is that he doesn’t put his chips on the table with a plan, letting others fight it out.

But more importantly, if Obama’s plan is credible to Blankfein and other CEOs (who have called on both new revenues and spending cuts to be part of the mix) it means that Republicans risk even more isolation if they say no. As it is, the polls haven’t been in their favour (meaning if things go into January and taxes go up, then it’s likely the GOP would get the blame). But if the feeling among business leaders is that the Obama plan is acceptable, and the Republicans still say no, it makes them look even worse.

That being said, just because Blankfein is OK with it, it doesn’t mean that the plan is actually a good one for the economy. But from a pure deal-or-no-deal perspective, if Obama did an OK job convincing CEOs that he’s got a decent mix, then that probably does say something about deal prospects.

Now the question is, if Blankfein, who has called for things like an increased retirement age, goes for it, does that mean the left will hate it?

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