Hope Is Not a Model Either: Macro Forecasting
Progressive Income Redistribution Is Not the Only Business of Government

Are We Shifting Toward a Parliamentary System?

The first rule of any negotiation in which you don't want to be taken to the cleaners is to say three things:

  1. We are going to be dealing with each other for quite a while; it would be very nice if our interactions are win-win, because if they start out win-lose then they tend to degenerate to lose-lose very quickly.

  2. I would really like a deal on this issue.

  3. I don't have to have a deal on this issue--I could do X, and while X is not as good as a deal it is better for me than simply me letting you take me to the cleaners.

Matthew Yglesias recounts Obama's extraordinary negotiating failure:

Compromise In The Works: The rumored deals flying around Washington today all sound pretty bad. And how could they not be? The White House started with a position that:

  1. Failure to raise the debt ceiling is unacceptable.
  2. The country should enact substantial deficit reduction in 2011.
  3. Any deficit reduction package must include revenue increases.

But (1) and (3) were in significant tension. The White House strategy for getting (3) was to persuade the public that (3) was the correct position. They did that, and all polls showed that public opinion was on their side. But then an underpants gnome problem arose. They didn’t dissolve parliament and call for a snap election. Eric Cantor said “no” and once he said “no,” (1) collided with (3) and the White House dropped (3).

Once you’re there, how is the deal not going to be bad?

Then various people spent the past few weeks desperately trying to toss the President some kind of weapon he could use for leverage. Platinum coins, 14th amendment, weird option swap schemes, etc. But the President didn’t want to pick any of these up.

In that negotiating context, how can a decent deal emerge?

Let me reserve judgment until the surrender-and-visit-to-the-cleaners is actually set out, but I suspect that come Tuesday I will be forecasting a double-dip. Horrible for the economy. Horrible for America. Horrible for the world. And horrible for Obama's aspirations for a second term as well.

It's very hard to understand how he has wound up in this position.

One possibility is that Cantor and Boehner have figured out something that has been inherent in the system since FDR but that few people recognized. Perhaps the President is now the ultimate status quo player in the government: Whatever goes wrong the public takes to be his fault and his responsibility. If anything goes badly wrong his political adversaries pick up the pieces and are strengthened.

In that case, whenever the desires of the president conflict with the desires of the speaker of the House, the president has little leverage. Any speaker who does not fear disaster can roll any president. In this future, any bill that a speaker insists is must-pass gets attached to a debt-ceiling increase, and--unless there are people in the Senate equally willing to risk disaster, which is unlikely because senators are status-quo players too--so becomes law.

It's like a parliamentary system, with the debt-ceiling votes filling the role of votes of confidence.

Matthew Yglesias is depressed:

I actually think that whatever the contours of the deal, at this point the biggest damage is to the overall system of government. Obama has successfully transformed massive debt ceiling hostage taking from an act of breathtakingly irresponsible brinksmanship into a proven effective negotiating tactic. Suppose he gets re-elected in 2012. What’s he going to do when this issue recurs in 2013? Every time the president’s party has fewer than 60 votes in the Senate, we may face a recurrence of this crisis.

I'm not sure he should be that depressed--depressed yes, but not that depressed. Perhaps we will see Nancy Pelosi doing this to President Romney in 2013.