Last night the Republicans offered to do a short term increase of the debt ceiling to prevent default and President Obama angrily dismissed it, according to the Huffington Post:
At issue was Cantor’s repeated push to do a short-term resolution and Obama’s insistence that he would not accept one.
“Eric, don’t call my bluff. I’m going to the American people on this,” the president said, according to both Cantor and another attendee. “This process is confirming what the American people think is the worst about Washington: that everyone is more interested in posturing, political positioning, and protecting their base, than in resolving real problems.”
At this point though I don’t see why Eric Cantor won’t try to call President Obama’s bluff threatening to veto a short term deal.
As I have explained in more detail before, Obama’s threat to veto any short term increase has created a serious credibility problem for the President. You can’t say both 1) default would be a huge problem and 2) that you will single-handedly cause a default simply because you won’t grant the GOP’s request for a short term increase so they can have a few more days to negotiate.
The Republicans are already trying to shift the responsibility for the debt ceiling unto Obama. From their perspective, I see no reason why, on July 29th, the GOP shouldn’t bring to the floor a 30 day increase paired with a small amount of some of the most politically palatable budget cuts. They could message such a move with something like, “we need more time but we are unwilling to risk the full faith of the US credit.”
If Obama rejects the short term increase, Republicans will wash their hands and claim whatever bad happens to the economy happened because of a default that is now totally Obama’s fault for unreasonably rejecting their modest request for more time.
Either Obama will be forced to break his veto promise, forced to prove he lied about August 2nd being the drop dead date, or risk allowing the GOP to have a believable story for why Obama should be solely blamed for the bad economic consequences of default.
At this point I see no good reason, from a political perspective, why Cantor shouldn’t call Obama’s bluff.