US debt crisis: Obama’s sharp right turn (The Guardian)
The Guardian, julho de 2011
When Bill Clinton lurched rightwards to secure re-election in 1996, he had at least the benefit of a strong economy. And Republicans got the politics of standing by their principles wrong. Barack Obama, in contrast, does not have a strong economy behind him. Growth in the first quarter all but ground to a halt, and in the second, posted an anaemic annual 1.3% rate. His economy, like ours, is crying out for more jobs, and all Washington can deliver, one with a Democratic president and a Democrat run Senate, is cuts. The stimulus has run out of steam and like ours, the economy risks flat-lining. Nor, unlike 1996, is there any indication of a voter backlash for mainstream Republican candidates. On the contrary, Republicans can argue persuasively that where they blazed the trail on slashing spending, the president has followed.
So the outline deal on raising the debt ceiling which emerged yesterday is not a triumph of compromise and reason. True, it will avert a disaster, but one that had been fabricated by the Tea Party themselves. Raising the US debt ceiling is in any other time a matter of arcane interest nodded through Congress without anyone much noticing. It has happened about 140 times in the last 60 years. If the emergency of a default was a false one, so the relief that a deal brings is ersatz, too. Make no mistake, the deal itself marks the sharpest rightwing turn of Mr Obama’s presidency – $3tn in cuts over the next decade, much of which would be decided by a joint congressional committee. The scale of the cuts is guaranteed with triggers of across-the-board cuts if the committee can not agree on where to find them. There was still a gap over what those triggers would look like, and a fight lies ahead about which programmes to cut, but the principle of spending cuts in the absence of tax raising-measures, has been surrendered.
Senator Mitch McConnell, the Republican leader, was right to sell the outline deal yesterday morning as a Republican victory, when he said that they had come a long way to doing what conservatives want – to cut spending. Mr Obama will have secured the principle that a default is not threatened again during the election campaign, but little else. David Plouffe, a senior adviser, unconvincingly claimed that his side was still holding out for tax increases, but as they had already sold the pass a week ago, there was scant prospect of that. Even before the midterm elections in November in which the Democrats lost control of the House of Representatives, Mr Obama said he would pivot to deficit reduction after two years of stimulus designed to rescue the economy. All he has done is go farther than he originally intended. The House speaker, John Boehner, might still face a revolt from his Tea Party freshmen when the package is put to the vote in the Republican-dominated assembly today.
More humiliations of the type he endured last week might still be in store for him. But you would have to be a shining optimist to yet see any electoral downside for mainstream Republicans like him “going to the dark side”, as his Democrat predecessor Nancy Pelosi so aptly called the pandering he has done to the Tea Party agenda. All the indications are that an intransigent, ideological and populist Tea Party are providing Republicans like him with their cutting edge.
All this is bad news for America’s jobless. Austerity is not the road to recovery. And compare where Mr Obama ended up in this debate with where he started. In April this year as he laid into the GOP’s opening shot by Paul Ryan, Mr Obama said: “… at a time when the tax burden on the wealthy is at its lowest level in half a century, the most fortunate among us can afford to pay a little more”. Substitute one word in that prophecy, the “least” for the “more” fortunate and it will turn out to be true. But that is not what Mr Obama was voted in to do.
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