This Time Around, Obama Really Won’t Negotiate Over the Debt Ceiling


Treasury Secretary Jack Lew said again this morning that President Obama’s resolve on the debt ceiling is firm:

“What we need in our economy is some certainty. We don’t need another self-inflicted wound,” Lew said in a “Squawk Box” interview. “Congress should come back and they should act.”

….The president is “not going to be negotiating over the debt limit,” Lew told CNBC. “Congress has already authorized funding, committed us to make expenditures. We’re now in a place where the only question is, will we pay the bills that the United States has incurred?” Answering his own question, Lew stressed there can be no question about that.

As part their budget-reduction strategy, Republicans have been trying to repeal and defund the president’s health-care law. But Lew said the White House won’t accept any delay or defunding of Obamacare.

It’s pretty obvious that Obama regrets negotiating over the debt ceiling back in 2011, thus giving Republicans an expectation that he might do it again. At the time, I think Obama was genuinely eager to pass a Grand Bargain on long-term deficit reduction and viewed the debt ceiling as a good pretext, one that would make both Democrats and Republicans more likely to come to an agreement. In the end, that failed, and this time around there’s really nothing Obama wants from Republicans. They had their chance at a serious debt-reduction deal and turned it down, and Obama obviously has no desire to waste his time with that again. Besides, with the deficit already plummeting, he doesn’t need a deal anymore and couldn’t get congressional Democrats to support one even if he did.

So he can stand firm pretty easily because there’s nothing much Republicans can offer him. The only leverage they have is a government shutdown, and that isn’t much of a threat. Both Obama and John Boehner know perfectly well that a shutdown would hurt Republicans more than it would hurt Democrats.

But that’s logic, and logic is selling at a deep discount these days. The fever swamp wants a debt ceiling default, and there’s a pretty good chance they’re going to force one through. Boehner just doesn’t have the clout or the influence to stop his lemmings from racing over the cliff. At this point, the most germane question probably isn’t whether Republicans are going to force a default, but how long they’ll hold out after they’ve done it. Just how badly do global markets have to panic before they finally come to their senses?

I don’t know. But as long as we’re on the subject, I’d like to add one pre-emptive note. The debt ceiling crisis is likely to renew calls for Obama to settle the whole thing unilaterally by issuing a trillion-dollar platinum coin. As you all know, my own view is that this is plainly illegal, but my view doesn’t matter. What matters is that the platinum coin option only works if the Fed is willing to accept it on deposit, and this is something they’ve already said they wouldn’t do. Like it or not, this means there is no platinum coin option. So let’s not spill too much ink on it this time around, OK?

SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

payment methods

SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

payment methods

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate