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How Obama Blew the Great Debt Ceiling Battle of 2011


Obama blew it. Whether by artful design or by sheer timidity is immaterial. He blew it. Two days before the United States was officially set to default on its debts on August 2, 2011, Barack Obama had the Republicans where he wanted them: All he had to do was announce that he’d trudged the last half mile towards a deal but that there’s no pleasing  fanatics who  reject all possibilities of compromise, who are ready and eager to shut down the government, to see seniors starve and vets denied their benefits. So, Obama could proclaim, he was invoking the 14th Amendment to the US Constitution, which states that the “validity of the public debt of the United States … shall not be questioned.”

Obama could have done that, but he didn’t. At the eleventh hour and the fifty-fifth minute he threw in the towel, and allowed the Republicans to exult that they’d got 95 per cent of what they wanted: cuts in social programs,  a bipartisan congressional panel to shred at its leisure what remains of the social safety net, no tax hikes for the rich, no serious slice in the military budget.

As America plummets into phase 2 of the double-dip recession Obama’s deal has stripped the country of all available remaining  defenses: no jobs program, no hope of stimulus money for stricken states and cities across the country. It’s as bad as the Republicans’ onslaught on Franklin Roosevelt’s programs  seeking to prise America out of the great Depression – a Republican onslaught that launched the terrible downturn of  1937, from which America was extricated only by the vast war spending after Pearl Harbor.

Why did Obama do it? Like all first-term presidents he thinks first and foremost about reelection in 2012, and the thinking in the White House is that the all-important independent voters, are eager for deficit reduction, however ruinous it may be for the economy.

Polls show that Obama had a winning hand. His approval ratings are in the mid 40s in percentile terms, more or less where they’ve been for months. But Congress is now down at 18 – the lowest since records began. So he could have called the Republicans’ bluff at any time. Sure, Americans will always say that deficits should be reduced. That’s like asking if you support an end to gassing badgers. But when you ask them something serious, like Do you want a job, they say Aye – by any means necessary, including increased federal spending.

But beyond coarse political calculation, and eagerness to satisfy his Wall Street backers, it’s plain enough that Obama is a quitter by nature. As someone joked bitterly last week, he turns up for a strip poker session already down to his shorts.  In the crunch, the weapon he snatches from its scabbard is the white flag, which he flourishes brzenly  at the bankers, the Pentagon, and America’s billionaires.

It was plain in 2006 – the first time we looked at his record — that Obama was gutless and devoid of principle. By 2008, before his victory,  he was already reassuring the Establishment he was set to “reform” Social Security and Medicare – i.e., to hand these entitlement programs over to Wall St and the insurance industry.

Indeed, the best outcome for the left in 2008 would have been a victory for McCain, Obama’s Republican opponent.  McCain! But, you wail, he would have plunged America into new wars, kept Guantanamo open, sent drones over Pakistan, launched an onslaught on entitlements, surrendered to Wall Street and the banks …

McCain would have tried all these things, but maybe he would have quailed amid a storm of public protest. Under W. Bush’s two terms the spirit of opposition throve; the antiwar movement flourished; the labor movement was active; blacks militant.  Amid a brilliant campaign mounted  by the AFL-CIO, Bush’s hopes to gut social programs were dead within months of the start of his second term  in 2004.  But since 2008 a Democratic president has neutralized all these constituencies.

In 2010, in the midterm elections,  the American people spoke, and their message was confused. When exit pollsters questioned 17,000 voters across the nation as to who should take the blame for the country’s economic problems, 35 per cent said Wall Street, 29 percent said Bush and 24 percent said Obama. Just over half of the respondents (57 percent) said that their votes in House races had nothing to do with the Tea Party. The other half was split on the Tea Party, pro (22 percent) or con (17 percent). More than 60 percent said the all–important issue is the economy; 86 percent said they are worried about economic conditions. On whether government should lay out money to create- jobs or slash expenditures to reduce the deficit, there’s also a near-even split.

The American people wanted a government that wouldn’t govern, a budget that would simultaneously balance and create jobs, and spending cuts across the board that would leave the defense budget intact. Collectively, the election made plain, they hadn’t a clear notion of which way to march.

Obama carries substantial part of the blame for this. He delivered no clear message, no clarion call. For two years he gave labor nothing; he gave his most loyal constituency—black America—nothing. When the “One Nation” rally mustered in Washington on October 2, 2010 there was no stentorian message of support from Obama for the event, sponsored by the NAACP and the AFL-CIO. Among the vast throngs who gathered for Jon Stewart and Stephen Colbert’s politically inconsequential “sanity rally” on October 30, how many were young people who had voted for Obama in 2008, their passionate expectations now mutilated on the battlefields of Obamian realpolitik?

As Obama reviewed his options after the midterm elections, which way would he head? He’d already supplied the answer. He’d try to broker deals to reach “common ground” with the Republicans, the strategy that destroyed those first two years of opportunity.

Jeffrey St. Clair is the author of Been Brown So Long It Looked Like Green to Me: the Politics of NatureGrand Theft Pentagon and Born Under a Bad Sky. His latest book is Hopeless: Barack Obama and the Politics of Illusion. He can be reached at:

Alexander Cockburn’s memoir A Colossal Wreck (Verso) is now available from CounterPunch.

A version of this essay ran in the October 15-31, 2011 edition of CounterPunch.



Jeffrey St. Clair is editor of CounterPunch. His new book is Killing Trayvons: an Anthology of American Violence (with JoAnn Wypijewski and Kevin Alexander Gray). He can be reached at: Alexander Cockburn’s Guillotined! and A Colossal Wreck are available from CounterPunch.

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