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A lot of Tea Party conservatives are a little uneasy about the recent budget deal. I think that's with good reason. Cutting $38 billion, while substantial in most quarters, is a mere drop in the bucket of the kind of spending that needs to be cut. To some, this deal may be indicative of the typical Republican capitulation - willing to compromise their principles to look like they're getting along.
I want to state that I think that is possible. But something else is possible too, that to be fair, I think deserves a hearing. It's entirely within the realm of possibility and even probability that the Republicans in the House have just outsmarted the "smartest president we've ever had." How so? By cutting this "deal," they now have the upper hand to demand - and receive - much larger, much more substantial cuts in the next month or two.
How? It's really not that complicated. Marc Thiessen explains it this way:
Going into last week's showdown, the conventional wisdom held that Republicans were in the weaker negotiating position ? in danger of repeating the debacle of 1995 when President Clinton succeeded in blaming them for shutting down the government and used the standoff to rescue his flagging presidency. Yet on Friday, Republicans succeeded in forcing Obama to accept some of the largest spending cuts in history. Why? Because the president wisely recognized that the political landscape had changed dramatically since 1995. If Obama was confident voters would have blamed the GOP for a shutdown again, the government would be closed as you read this. Instead, the president caved.
What does portend for the coming debt-limit fight? It means Republicans hold all the cards. After all, if Obama was not willing to allow a temporary government shutdown on his watch, he certainly will not allow a cataclysmic government default. As Treasury Secretary Timothy Geithner recently warned Congress, default would "cause a financial crisis potentially more severe than the crisis from which we are only now starting to recover." President Obama will not allow this to happen under any circumstances. Unlike his threat last week to veto a short-term spending bill and let the government close, he has no such leverage when it comes to the debt limit.
Thiessen's right. Barack Obama would have let the government shutdown by rolling the dice on the hope that Americans would blame Republicans for it like they did in 1995. But Barack Obama will not let the country default on his watch because he knows that he will be held accountable and his presidency will be over. This is a whole different animal, and Republicans have all the leverage. So what if the debate stalls?
If negotiations stall, House Republicans could pass a series of small debt-limit increases, with spending cuts attached, to keep the government solvent. Obama would be in no position to veto such temporary measures ? because his veto would cause the government to default. Republicans can keep doing this until Obama capitulates. In the end, the president will have little choice but to swallow whatever spending reforms the GOP demands.
And those demands can be virtually anything. It can be Paul Ryan's plan of cutting $179 billion from the 2012 budget and $241 billion from 2013. It can be Ryan's reasonable and necessary reform plan for Medicaid - allowing states "block grants" of money to try new and innovative ideas with the program. Or his plan to provide government subsidies to seniors who want to buy their own insurance rather than use Medicare - allowing this choice would save an incredible amount of money given that the most popular Medicare plan (Part D) is already built around this very concept.
Republicans can insist on President Obama committing to major entitlement reform, or committing to a balanced budget amendment to the U.S. Constitution (a long term solution) because they hold all the cards. As Thiessen writes:
There may be reason for Tea Party conservatives to lament the lack of Republican backbone. But I don't think we know that is the case yet. The Republicans have given themselves all the leverage to do what needs to be done and what the Tea Party has been demanding. I will wait to see if they use it before I cast judgment.
This is no time for Republicans to play small ball. In the debt-limit fight, the GOP enjoys a perfect storm of public support, political leverage and presidential weakness. This means Republicans have a once-in-a-lifetime opportunity to do something big. They must seize it. If Obama wants to raise the federal debt limit, the price should be the even deeper cuts and reforms proposed by Ryan - and a balanced budget amendment that would force Congress to implement them.