The election is over - but the campaign continues

 
Republican Speaker of the House John Boehner (left) and President Barack Obama at the White House 16 November 2012 The White House has said the president will not agree to a deal that extends tax cuts for the wealthiest Americans

US President Barack Obama is banging home a single message this week - that Republicans should go along with tax cuts for "ordinary Americans" before Congress gets around to any other business.

On Monday, the White House issued a report claiming if they did not buy this it would cost everyone more than $2,000 (£1,248) a year.

Today, Tuesday, the president meets owners of small businesses. On Wednesday he will be in the White House with "middle-class Americans". On Friday he will go to Pennsylvania to visit a business.

President Obama is preaching hard from the bully pulpit. Teddy Roosevelt once said the main power of the president was the "bully pulpit" - meaning a terrific platform for advocacy rather than using moral strong-arm tactics - but either interpretation fits what the president is doing like a glove.

'Suicide pact'

It is almost as though the election campaign never stopped. But now he is spending the capital he earned by winning.

This is all part of the struggle on the edge of the so-called "fiscal cliff". It is a horrible term, but what it means is a sort of suicide pact between Republicans and Democrats.

What is the fiscal cliff?

  • Under a deal reached last year between President Obama and the Republican-controlled Congress, existing stimulus measures - mostly tax cuts - will expire on 1 January 2013
  • Cuts to defence, education and other government spending will then automatically come into force - the "fiscal cliff" - unless Congress acts
  • The economy does not have the momentum to absorb the shock from going over the fiscal cliff without going into recession

If they do not agree to cut the deficit by 1 January 2013, then automatically there will be tax rises and spending cuts that will dismay both parties, and more importantly, would probably send America into a new recession, dragging the world economy with it.

It would certainly curb America's budget deficit, but only by ushering in what the Washington Post's wonkblog calls "an austerity crisis".

It was meant to concentrate minds on finding a solution, but the cure is almost certainly worse than the disease.

So, what is the president playing at?

It is highly unlikely the Republicans will give him what he wants. If they agree to "middle-class tax cuts", the fiscal cliff would still loom.

It is true the drop off the edge would become a little shorter, and a little less painful, but it would still hurt a lot and they would have agreed to hand over a major bargaining chip without getting anything in return.

So this looks like the president playing at a fairly brutal long-term political game - continuing to paint the Republicans as caring only about the rich, unwilling to help ordinary Americans.

It is hard to see how this makes it any easier to get an agreement in the next few weeks.

At the moment, this is fairly esoteric. But it matters. It starts to tell us how the president will play the second term, whether he will try to be a bridge - a conciliator - or use his new mandate to push his own distinct agenda.

And it matters because if he or the Republicans do misjudge their brinkmanship, it won't be just them tumbling off the edge - they could take the rest of us with them.

 
Mark Mardell, North America editor Article written by Mark Mardell Mark Mardell North America editor

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  • rate this
    0

    Comment number 185.

    Why do people act as if there was only 1 election? There were at least 467 Federal Elections, and the Republicans won 279 of them. Americans voted for more of what they've had for the last 2 years.

  • rate this
    0

    Comment number 184.

    Curt Carpenter (180),

    "... There is surely some level of tax increase -- on everyone -- that would be equitable AND spare the world another deep recession."

    Very true, but that is unlikely to happen.

  • rate this
    -1

    Comment number 183.

    walleye... you did not address Obama's tax hike on the top 2%, as the panacea while the CBO says will not make much a dent in the debt. Your intellectual depth mirrors that of the shallowing bay of pigs. I would guess you are an entitlement net taker rather than a generous giver as I am.

  • rate this
    +1

    Comment number 182.

    177. usa-reality

    Well how about the fact that the U.S. economy was doing just find in the 1950's and early 1960s with a top marginal tax rate of ~90% and many more tax brackets.

  • rate this
    +1

    Comment number 181.

    169 ‘a community organizer is a shake down artist’

    No.
    A community organizer is a community organizer
    A shake down artist is a shake down artist
    A lie is a lie
    A defamatory groundless smear is a defamatory groundless smear
    A Romney is a failure
    President Obama’s re-election is something you can’t stand. Tough.

 

Comments 5 of 185

 

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