It’s happening again. The clock is ticking amid yet another fiscal showdown between President Obama and Congress, which is making noises about shutting down the government, or not raising the debt ceiling unless some concession is made.
The most famous of these showdowns came in the summer of 2011, when the Tea Party-infused GOP took the debt ceiling fight down to the wire, only to relent once Obama and the Democrats agreed to automatic future spending cuts (which we now call the sequester).
This time we’re getting a fiscal two-step: At the end of September, the government will shut down unless a “Continuing Resolution” is passed. A little bit after that the U.S. will hit the debt ceiling.
Not only do we have two “events” in rapid succession, but there’s a twist:
Texas Senator Ted Cruz and a band of fellow travellers are promising to block the continuing resolution (in other words shut down the government) unless somehow the Congress passes (and Obama signs) a bill that would defund Obamacare.
Now if you think there’s any chance that Obama will sign a bill to defund his signature program, on the eve of it going into effect, you’re probably living on another planet. But on the other hand, Republicans in the age of Obama are not known for being compromisy. It’s smash-nose politics all the way down.
Except, oddly, the Republican party is pissed off at Ted Cruz.
See, Cruz has been making life kind of miserable for a lot of House Republicans all summer by holding rallies, and pressuring them to vote to defund Obamacare. Essentially he’s being an interloper from the Senate, getting in the House’s business. Eventually, this week they did successfully hold a vote that would keep the government funded at current levels of spending, with the exception of Obamacare.
But after that it all went downhill for Cruz and the GOP because now the bill has no chance to pass in the Senate. House Republicans (and also conservative pundits) are flipping out at Cruz because they see only bad options from here. Either conservatives surrender on the issue, or there’s a government shutdown.
And it’s this government shutdown possibility that has everyone freaking the hell out.
Charles Krauthammer declared that the Republican party will end up as “sushi” if this fight to defund Obamacare ends up shutting down the government. The conservative WSJ editorial page calls this a “kamikaze” mission that will play right into Obama’s hands.
None of the arguments we’ve seen actually say that a government shutdown would be bad for the country (although it would depress government spending) … all the arguments are about how bad a shutdown would be for the GOP and how it would be good for Obama.
And this gets to the nut of why Republicans are so upset. For the first time since the Tea Party had its big win in 2010, a wing of the party is actually engaging in a fight that puts the party at risk.
In the 2011 debt ceiling fight, the GOP was essentially free-rolling (meaning playing risk-free). They could threaten to not raise the debt ceiling knowing that Obama could not afford to actually let that happen. And they knew that the public didn’t understand what the debt ceiling was (the public still doesn’t), which is why polls show the public not in favour of raising the debt ceiling, even though the consequences of not raising it would be quite severe (far more than a government shutdown, which can be done in an orderly manner, and which doesn’t put the service of U.S. debt at risk).
Obama can afford to let a government shutdown happen (at least for a few days). The GOP would have to live with what it wrought, and the public would understand exactly what was going on. Threatening to shut down the government over Obamacare is not free-rolling. It’s a threat with real consequences. It’s a principled threat. That’s why your Krauthammers and your WSJs and your Jonah Goldbergs (who says Cruz is engaged in a “long con”) are screaming bloody murder.
Unlike the debt ceiling battlers, Cruz is putting principles over his party. And that has people apoplectic.
Even the CEO of conservative outside group Heritage Action agrees that the anger here is that Cruz is doing something that might hurt the GOP.
Ezra Klein makes the correct point at Wonkblog that it’s John Boehner who is being more irresponsible than Cruz, because Boehner actually is promising a fight over the debt ceiling (which will come up later) and with the debt ceiling you have the threat of a default and financial calamity.
Defenders of the Boehner/debt ceiling approach say that such a fight isn’t bad for the country because ultimately the debt ceiling will get raised somehow.
But this is crap. First of all, it’s logically inconsistent to threaten to not raise the debt ceiling (unless some demands are met) and then argue that such a threat is harmless because ultimately you’re going to not follow through with it. Either you’re making the threat or not. And if you’re making the threat, then you’re threatening for the U.S. to not pay some of its bills.
But furthermore, just the debt ceiling fight itself has consequences. Summer 2011 showed a collapse in consumer confidence (red line) and what might be characterised as a crash in the stock market (blue line).
Bottom line: There are two possible battles for a fiscal fight.
One hurts America, but leaves the Republican party looking ok. That’s fighting over the debt ceiling, which most people don’t grasp.
The other causes a brief government shutdown, while making the GOP look terrible on an issue that people grasp.
Cruz is launching his fight on the one that makes the party look bad, and that’s why conservatives are flipping out at him.
It’s too much to ask that Washington not have these dumb fights. But if you’re going to have one, it should be the one that doesn’t pose major systemic risk to the system. Cruz is fighting the right one.
Business Insider Emails & Alerts
Site highlights each day to your inbox.