Daily Israel Report

Obama Sustained More Severe Damage in Deficit Debate

While the public was critical of both sides in the deficit ceiling debate, Barack Obama was the bigger loser.
By Amiel Ungar
First Publish: 8/1/2011, 3:25 PM

It was clear from the outset that with Republicans holding the House of Representatives and the Democrats holding the Senate and the White House, no side was going to emerge with a clear-cut victory in the debt ceiling crisis.

This left two distinct alternatives: Compromise or deadlock and ensuing default. Despite the cliffhanger atmosphere, it was a virtual certainty that the United States could not afford to default, and therefore a compromise would be reached.

A compromise leaves both sides disgruntled and this does not necessarily mean that it is the fairest and most optimal solution. Both liberals and the Tea Party are angry with Barack Obama and with the Republican congressional leadership, respectively, for making too many concessions. According to polls, both President Obama and the Congress have lost popularity.

However, at this juncture, it appears that Barack Obama was the more heavily damaged, particularly in terms of his reelection bid.

A president, particularly amongst his supporters but also amongst the general public, is judged by his efficacy. The zenith of the Obama administration was the passage of the public health bill although that measure, more than anything else, helped to mobilize the Republican base. This was the redemption of "yes we can" and represented forward momentum for the people who elected Obama.

The debt ceiling crisis represented a rearguard holding action against the Republicans and did not end in victory. A draw on such a high visibility fight is tantamount to defeat.

Barack Obama came to power as a heroic leader of almost rock star dimensions. He was not your average politician and was seen as ready to totally shake up Washington. Demigods don't settle for draws or Congressional deals brokered by Senators Harry Reid and Mitch McConnel and House Speaker John Boehner.

In addressing the nation after the deal was reached, there was little triumphalism from Obama. He attributed the deal to the popular pressure exerted upon Congress. He did not supply the leadership, the people did.

Obama is still liked in many circles, and defeating him will not be easy, but the charisma and enthusiasm of 2008 are gone.

The compromise, although disliked by fiscal conservatives, limits the Obama administration's capacity to produce an expansionary budget. This, too, will play a role in 2012. In politics as usual, the party in power likes to increase spending in the run-up to elections because this temporarily creates more jobs and a general feel-good factor. The accumulated debts can be paid off following electoral victory or, in the case of defeat, deposited on the door step of the president's successor who will have to cope with the consequences.

To improve his electoral chances, Obama has to restore fiscal health or at least provide the semblance of economic health.

Currently, the prospects are that he will be able to do neither.