Republicans back to their old tricks, like in a bad joke

WASHINGTON - Karl Marx remarked once that history repeats itself twice: first as a tragedy and the second time as a farce. But since he wasn't around when the Tea Party-led Republicans achieved a dominant position on Capitol Hill, the German political philosopher didn't consider the possibility that dialectical thinking can sometimes run amok, and that the history of budget crises in Washington could evolve into something worse than a farce. A sad joke, for example.

In the aftermath of the Republican 2012 electoral nightmare, the expectation in Washington was that the GOP was going to draw a lesson from their history of trying to destroy President Barack Obama and his policy agenda.

Indeed, the Republican strategy during the four years of Mr Obama's first term was to basically say "No! No! No!" to everything the White House was proposing in terms of fiscal policy and instigating a series of political and legislative cliffhangers aimed at sabotaging the President's budget plans, including threats to allow a shutdown of the federal government and to refuse extending the debt limit.

This particular strategy ended up as a political loser for Republicans, not to mention the devastating effect it had on America's standing in the financial markets.

That explains why, following the elections, the Republicans decided that they would work some sort of a political ceasefire with the White House over the budget and reached a compromise deal that included an agreement with GOP leaders to increase the tax rate on the super-rich and the big corporations.

Similarly, with both sides exhausted with the neverending games of chicken over the budget, they agreed to allow for a series of automatic spending cuts AKA sequestration.

But it now seems that the Republicans are back to their old tricks. So it looks like when Congress returns from its summer recess after Labour Day and Congress is asked to authorise a new measure to fund the government in September, the Republicans, who still control the House of Representatives, are planning to pick a fight.

Mr Obama is not likely to surrender what he considers his central fiscal objectives: accelerating the economic recovery and assisting the economically squeezed American middle class.

The hope among the president's economic and political advisors is that a tough stand by the White House would put added pressure on the Republicans to reach a "grand bargain" on fiscal policy that would replace the current sequestration with a long-term plan to reduce the federal deficit through a mix of spending cuts (the Republican demand) and increasing tax revenues (which the Democrats prefer).

The White House and the Democrats are hoping that Republican obstruction and the ensuing shutdown of the federal government on the eve of the Christmas season, resulting in the suspension of unemployment payments and air travel, would ignite an anti-Republican backlash among voters who would then punish the Republicans in the 2014 midterm Congressional elections.

In theory, this leads to the loss of GOP majority in the House of Representatives.

The problem is that we've seen that movie before and we know how it ends. Republicans continue to win in Congressional elections because activists and voters in the districts they now represent share their anti-Obama sentiments and applaud the GOP lawmakers for refusing to make a budget deal with the White House. In short, the Republicans in the House have no political incentive to compromise with Mr Obama.

And even if the two sides are able to agree on some sort of an interim agreement that would avert the shutdown of the government, expect a second act budget confrontation in October or November when Congress will have to approve raising the limit on federal borrowing. Once again, Republicans could threaten not to do that unless Mr Obama and the Democrats agree to new spending cuts.

In a way, neither the Republicans with their majority in the House nor Mr Obama who was re-elected for a second term can win another series of brinkmanship acts over the budget, and the conventional wisdom in

Washington is that after a lot huffing and puffing on both sides, they will agree to maintain the status quo and allow for more sequestration cuts to go into effect next year.

And once again, both the Republicans and the Democrats would express their hope that an electoral swing in the 2014 midterm polls - the Democrats want to retake the House while the Republicans want to take over the Senate - would provide them with the legislative numbers to get their fiscal agenda.

But once again, history will repeat itself: Both sides will fail to achieve their electoral dreams, and Washington will be back in gridlock. A bad joke, indeed.


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