In One Sentence, Here's What Makes This Debt Ceiling Fight Scarier
Several folks seriously think that this time around the deal dynamics are actually WORSE than they were during previous tense rounds of negotiations, the most famous of which was the 2011 debt ceiling standoff.
Yesterday at POLITICO, Ben White had a big piece on 'why Wall Street should worry.'
In today's Morning Money newsletter, Ben White passes along one comment which really speaks to the different, more worrisome dynamics this time around.
DEMS HOPING FOR SHUTDOWN SHOWDOWN? – From a top Dem consultant, reacting to yesterday’s story on risks Wall Street is ignoring in DC this fall: “One last risk factor for government dysfunction this fall is that POTUS and some Senate Dems are spoiling for the Repubs to do what comes naturally and push the ‘shut down’ envelope to the max. If you listen carefully, you'll hear Obama in effect baiting the GOP into an optically disastrous economic stance one year before the election”
This is the key difference which maybe people don't appreciate.
There's a sense that Democrats mean it this time when they say they will not be negotiating. Not only is there perhaps an electoral benefit to letting the GOP do something stupid, but there's also a sense that existing sequestration cuts will be made "permanent" if there's no fight this time to reverse them. This time around it's not just the GOP looking for something, but Democrats have an agenda as well, and that makes a deal that much harder.