Obama loses credibility over debt deal

Over the weekend, the Washington Post published a carefully reconstructed account of the failed debt ceiling negotiations that occurred last summer between House Speaker John Boehner and President Obama. Surprise-it was Obama who blew the deal.

By The Fiscal Times Mar 21, 2012 5:39PM
By Liz PeekThe Fiscal Times

Is it acceptable for the President of the United States to lie to the American people? In cases where the truth would undermine national security, absolutely. In cases where the truth undermines the president’s approval ratings, not so much.

Over the weekend, the Washington Post published a carefully reconstructed account of the failed debt ceiling negotiations that occurred last summer between House Speaker John Boehner and President Obama. In the aftermath of the breakdown in the talks, Mr. Obama was quick to blame “irresponsible” House Republicans for his inability to conclude a “grand bargain” to rein in future budget deficits. He maintained that his was the middle course, that he was open to a balance of spending cuts and revenue increases but that the GOP refused to allow any tax hikes.

The narrative stuck. The worried country was irate at the inflexibility of Republican leaders. On August 5, when Standard & Poor’s downgraded the credit rating on U.S. debt for the first time in U.S. history, Americans knew just whom to blame.

Only it turns out, according to the version released by the Post, the president wasn’t telling the truth. John Boehner was right when he said that the president was the one who had stepped away from the budget talks, fearful of the political fallout that might attach to bold measures to tackle our nation’s deficit. Because the“Gang of Six” senators inserted into the talks an agreement at the last minute that called for bigger spending cuts and greater increases to taxes than those under discussion in the White House, the president became alarmed that his bargain would not seem so grand after all. If Gang of Six conservative senators like Tom Coburn and Saxby Chambliss could accept tax hikes of $2 trillion, how could he press for only $800 billion?

Panicked that he was losing the high ground, the president ditched a nearly-concluded agreement with Boehner that called for raising taxes while also cutting sacred cows like Medicaid and Medicare and raising the age for receiving Social Security benefits.  He scuttled that deal by suddenly demanding 50% more in tax hikes; then, when the GOP blanched, Obama pivoted again to the “hand shake” deal almost concluded. Finally, Republicans had had enough. In the end, Mr. Obama chose political comfort instead of manning up to a risky but essential effort to change our fiscal trajectory.

This is no small lie. At the beginning of this year, President Obama laid out his reelection themes. He accuses Republicans for choosing to protect the wealthy from higher taxes at the cost of the nation’s fiscal health and blames a “do-nothing” Congress for refusing to pass more job-creating legislation. It may not seem like a particularly impressive message – most people think the presidency is a powerful post – but it suits Mr. Obama to blame his predecessor George W. Bush for the deep recession that took hold in 2007 and to blame Republicans in Congress for our abnormally slow recovery. (It should be noted that Mr. Obama also occasionally throws Democrats in Congress under the bus too; he is an equal-opportunity blamer.)

If the story is not true – if it was Mr. Obama who caved into political pressure and not Mr. Boehner – much of his message over the past several months becomes not only false but massively distasteful. It would certainly explain why the GOP leadership has been unwilling to meet the president half-way; no one likes to be the fall-guy. The president vented his frustration over the breakdown of talks by attacking the GOP, and by personally going after Mr. Boehner. He accused the House Speaker for not returning his phone calls, complained that it was the GOP leader that walked away from the talks, and whined that “I’ve been left at the alter a couple of times now.”

In his East Room address in July concerning the debt ceiling negotiations, Mr. Obama blamed “a significant number of Republicans in Congress (who) are insisting on a cuts-only approach.” As we now know, this was not the reason the negotiations failed.  While some Republicans may have wanted such an agreement, their leadership was prepared to agree to some $800 billion in higher taxes. In any event, it wasn’t the cuts-only crowd that balked; it was the president. Railing at the GOP wasn’t a smart move; petulance does not become the Commander in Chief. In the end, both Mr. Obama and Congress suffered a decline in approval ratings.

As Americans learn the truth of this failed effort, they may start to question other aspects of the White House narrative. They may wonder whether the president blocked the Keystone XL pipeline out of safety concerns or to appease environmentalists whose support he needs, or whether Obamacare will in fact slow the rise in healthcare costs. They may even begin to question whether millionaires and billionaires actually pay less in taxes than their secretaries. Losing credibility is a terrible thing; on the other hand, Mr. Obama’s loss may be the country’s gain.  

Related Links:
How Obama Failed to Clinch the Debt Deal
Ryan’s Plan Could Decimate the Social Safety Net
Another Debt Ceiling Standoff? Please, Not Again!

Mar 26, 2012 6:35PM
So when the GOP calls his bluff, Obama wants to fold and take all of his toys home and then call the GOP the sore losers?  We need to send this "loser" home in november
Mar 26, 2012 6:44PM

NObama is such a scumball. Aren't we all proud of our first black president. We should have known better.


Hope and Change. What a joke. You hardly hear about it anymore. And for good reason. There will be no hope until we change presidents.

Mar 26, 2012 1:50PM
If everyone on here would post this to their facebook or tweeter page it would finally get the message out and the truth might be reported by the main street media, They will only keep lying for him if no one calls the press out. The press is actually more to blame for the financial mess we have than Bush or Oboma. Yes they both messed up but the press reported the fall of the financial system so much that they finally made it happen. They reported it as a way to preach gloom and doom to get Oboma elected. They are supposed to report the truth but only report their political side. If you want to truly know who prevented the congress from reigning in Fannie Mae and Freddie Mac type in Barney Frank and Freddie Mac on YouTube. Listen to the actual videos and learn what the press hides form you.
Mar 21, 2012 10:18PM
Gee look at how long it took MSNBC to catch on to this, and Hmmm where are the corrections to the mountain of propaganda they spewed
Mar 23, 2012 9:44AM
This ought to be on the front page, not just on the money page.  Is anyone else sick of our leaders putting politics before the good of our country?  Ron Paul 2012!
Mar 26, 2012 1:53PM

Hey I posted to my facebook page along with my comments. The people deserve to learn the truth.

Where is CNN, Fox and CNBC when the truth come out.

Mar 27, 2012 7:20PM

Fox's Liz Peek and Republicans say one thing, our President and the Democrats say another. I wonder who is telling the truth? Usually the truth is somewhere in the middle...

Mar 29, 2012 12:47PM
Liberals better start looking for another candidate. 
Mar 26, 2012 11:45PM
You dumb haters would rather have a bush in office sending your jobs oversea and smiling in your face as he continues to stab you in back and split in your face....you are so full of hate that even when your stupid butts are unemployed because your factory shut down due to Bush stupid policies that you will want another Bush then  a BLACK democratic President.....I hope all of your dummy's continue to suffer and eventually expirer.
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