As the maneuvering about the debt ceiling continues, the dynamic of the debate has shifted to one question: Will House Republicans be buffaloed into surrender on the question of tax increases?
Senate Republicans are starting to stray off the reservation to support compromise measures such as the Gang of Six plan that includes higher taxes and lower spending cuts than the plan the GOP had rejected in the past. That means the pressure on the House majority to let everyone in Washington off the hook for a potential default is growing every day, with many Republicans openly talking of their fear of being branded as the villains of the story in the event of a partial government shutdown.
I’ve written before that such fears are overblown, because that outcome was heavily influenced by the mismatch between President Clinton and then House Speaker Newt Gingrich. Yet even though neither Speaker John Boehner nor House Majority Leader Eric Cantor can be dismissed the way Gingrich was, the lack of resolve on the part of many in the GOP to stand their ground on an issue of principle may lead to a different calamity. If Republicans panic and adopt a debt solution that is seen by their grassroots core as a betrayal of principle, this will have a major impact on the 2012 election.
While the main story today seems to be about a revival of talk about a grand long-term solution to the debt crisis, if such a deal is put forward on the same terms as the Gang plan, then this will represent a significant retreat from Boehner’s generally sound ideas for such a scheme that were rejected by the White House two weeks ago.
It is a given Congress will have to pass a bill raising the debt ceiling but, with the clock ticking down toward the August 2 deadline, if Republicans split with most of their Senate caucus abandoning their House colleagues, the result could sink the whole party next year. Though there is more at stake here than politics, Senate Republicans who leave the House majority holding the bag on this issue will effectively be aiding Democratic attempts to brand the GOP as hopeless ideologues who deserve to be blamed for the crisis.
If Republicans stand tough, there is still plenty of time for them to wait for the Democrats to fold and to then enact a short-term solution that will not violate Republican pledges to hold the line on taxes while also raising the debt ceiling. If they don’t, the scenario that follows will be a disaster for the GOP.