Saturday, December 22, 2012

It's time to shuffle up and deal, Mr. President

Someone please let President Obama know I'm trying to get a poker night together sometime in the next couple of weeks. I'd really love to have Mr. Obama sit at the table and play with us. I think I can clean out his wallet.

You see, I don't think Mr. Obama is much of a poker player. He was just re-elected despite the high unemployment rate because folks thought he'd do a better job managing the economy than his opponent. His party has a bigger majority in the Senate and picked up a few seats in the House. He's not in a weak position facing the so-called fiscal cliff.

President Obama started off calling for a renewal of the Bush-era tax cuts for somewhere around 98% of the taxpaying public. His plan to avoid the cliff was to raise taxes on the wealthiest Americans and to trim some dollars from the budget.

His antagonist, House Speaker John Boehner, said he wouldn't stand for raising taxes on the wealthy and that he wanted to see more cuts to Social Security and Medicare and no cuts in defense spending.

If the parties couldn't agree by December 31, the tax cuts would expire and automatic spending cuts would go into place for next year's budget. President Obama held the high ground. If the House Republicans refused to go along with his plan, everyone's taxes would go up in the new year and their precious defense budget would be cut. The president had the best hand. All he had to do was shove his chips into the center of the table and the pot was his. There was no way Mr. Boehner would call that bet.

So what did Mr. Obama do?

True to fashion he checked the hand and offered more concessions to the GOP. How about we only raise taxes on those folks making more than $400,000 a year, John? And how about we cut more money from Social Security than we do from the Pentagon budget? Would that work for you?

As an aside, in all of this talk about Social Security, the one thing no one likes to mention is that Social Security isn't part of the federal budget. It's a "trust fund." While the government borrows from the surplus in the trust fund in exchange for treasury bonds, Social Security spending is completely unrelated to the federal budget. Now at some point in the future when FICA receipts don't cover the benefits paid out it might be a different story.

But if President Obama thinks that making more (unnecessary) concessions is going to engender bipartisanship in the House of Representatives, he's crazy. By caving in like he did he is only strengthening the GOP's hand. Now what's he going to do when Mr. Boehner shoves a stack of chips in the middle of table?

So come on down to Houston, Mr. President. I've got a chair for you. Checking with a strong hand is dangerous. If you make the bet, you're forcing your opponent to make a tough choice; but when you check your hand and your opponent makes a big bet now the onus is on you. When you've got a big hand, it's much better to lead.

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