Like Krugman, I'd have to vote no on this deal, and push for alternative resolution of the crisis. Despite protestations to the contrary, I think that non-bad deals are still possible, and that failure to reach a non-bad outcome in this fight increases the chance of having non-bad outcomes in future fights.
Why is it so important to look ahead? Tim Duy has a good summation of the strategic consequences of the deal:
Four thoughts come to mind:
- The debt-ceiling has been proven to be a very effective weapon, simply because there exists a non-trivial contingent of Republicans willing to push the button, but not a single Democrat. With that dynamic, the Republican goal of dismantling the social safety net looks achievable. They only need to chip away at it one debt ceiling at a time.
- Obama's attempt to stabilize the political system by moving to the center has failed utterly and completely. The problem for Democrats is that Obama's "center" keeps moving to the right. Obama thought that as he co-opted Republican positions, such as Romney care, he would gain Republican support. Instead, he pushed the Republicans even farther right as the only way to differentiate themselves from Obama. Then Obama thinks he needs to meet in the new "middle" - and hence we get a deficit deal with no revenue triggers, but only after a near-debacle that leaves the rest of the country, if not the world, shaking their heads. Will this episode bring sanity? No - expect the Republicans to move further right in the next debate.
- Is it futile to vote Democratic? Seriously, it is obvious now that your vote will deliver the same policy outcomes should you choose Democratic or Republican - but by voting Republican (at least on a national level), you also get the satisfaction of being on the winning team.
- Finally, it is utterly unbelievable that we are about to pursue an obviously contractionary policy course when the White House is held by a Democrat and in the wake of a GDP report that vividly illustrates the weakness of the economic recovery. Yet here we are. Team Obama must believe that deficit reduction worked in the 1990's, and thus should work now. Would a Republican president have seen the unemployment rate and the pace of growth and thought the odds of reelection where greater with a debt ceiling plan that couples long-term cuts with near term stimulus?