If President Obama strikes a major debt deal, it will reshape the contours of the 2012 election at every level
If Congress passes something resembling the $3 trillion deficit-reduction deal that President Obama and John Boehner appear to be angling toward -- still a very big "if" at this point -- it could do quite a bit to shape the contours of the 2012 election at the presidential and congressional level, although more the latter than the former, I suspect. The biggest effect would be to improve the fortunes of incumbents in both parties. Right now, Congress is about as unpopular and unproductive as it's ever been, to the point that experts think there's an increased likelihood of another wave election.
A historic deficit-reduction deal would change that perception, even if -- as I assume will be the case -- it winds up being hugely controversial and opposed by Tea Party hardliners for not going far enough. In the end, they'll campaign on it: $3 trillion is a hefty cut and too great an accomplishment not to tout if you were elected to Congress on a promise to cut spending. (Besides, they're hardly immune to Washington hypocrisy.) And if, as expected, the deal includes reforms (cuts) to social insurance programs, it will blunt Republicans' vulnerability after they adopted the Ryan budget with its attempt to dismantle Medicare. Nancy Pelosi will have a much harder time regaining the Speaker's office.
The question of which party will control the Senate after 2012 will also become more murky. Today, my guess would be the Republicans -- Democrats have too many seats to defend, many of them in red states. But cutting $3 trillion in debt would be about as valuable a credential as one could imagine for a vulnerable red-state Democrat like Ben Nelson or John Tester, and possibly let them squeak out reelection. Mitch McConnell's dream of becoming Senate Majority Leader would be that much harder to realize -- possibly one reason why he wasn't included in recent White House negotiations. Recall that McConnell's own debt-ceiling plan offered no deficit reduction at all, while forcing votes that would make it much harder for incumbent Democrats to get reelected.
And then there's Obama. One of school of thought, represented by Paul Krugman in today's New York Times, is that prioritizing debt reduction over jobs is foolish and possibly suicidal -- polls are clear that voters are more concerned with the latter than the former. I tend to sympathize with this viewpoint. But the argument in favor of debt reduction does make a depressing kind of sense: it says that Republicans are so recalcitrant that nothing stimulative could possibly make it through Congress. A historic debt deal, though it would do practically nothing in the short term to create jobs, would demonstrate that Obama is the post-partisan figure he claims to be -- the only man able to bridge the warring factions in Washington, and therefore someone deserving of reelection. To me, that seems a bit like putting shiny new rims on a broken-down car. But it is an accomplishment, it blunts the perception that Obama is a spendthrift, and it gives him something to run on that might distract from the lousy economy.
Image credit: Pete Souza/White House