US Fiscal: The White House Meeting

Published on October 2, 2013

Two quick points to make as the Congressional leadership heads down from the Hill to their 5:30 meeting with President Obama at the White House.

First, news is spreading across the media on Capitol Hill of a leak several days ago by Senate Majority Leader Harry Reid’s Chief of Staff of some private emails sent to him by House Speaker John Boehner’s chief of staff from several months ago.

The subject is not directly related to the current negotiations, but the leaks of the sort of to and fro of negotiations between staff in prepare for meetings or lay out positions served to inflame the House Republican Tea Party caucus and caused deep embarrassment to the Speaker and the leadership.

This sort of hard ball has now become an important small detail in the larger scheme of the current politics on the Hill because it has served to destroy the level of trust in the sort of crucial back channels needed to keep any future negotiations going while the politicians attack each other in public. So it presents a rather ominous backdrop to the White House meeting.

Already, the Republicans, of course, are grasping at the call to the White House as proof their hard lien is working in making the President blink and open the door to negotiations to end the impasse shutting down the government. For its part, the White House is insisting the meeting does not mark the start to negotiations and is instead an opportunity for the president to urge the two sides to pass the “clean” Continuing Resolution that Senate Majority Leader Reid has been pressing on the besieged House Speaker.

Second, little is likely to come of the White House meeting anyway, and it should be seen more as the second of an adroit one-two punch between the Senate and the White House to keep Boehner on his back foot. Indeed, in the rounds so far, Reid has had the upper hand.

Reid offered the GOP the budget conference they suggested at the 11th hour on Monday night, which however, was meant more as a messaging gambit than something substantial. But Reid is now running with it as the “compromise” to taking up his demand for a clean CR, albeit with no promises on its outcome. We would not be surprised to see a follow through to the offer with perhaps a sweetener of a little something to the Republican defense hawks or the House appropriators with a boost in the spending level.

But it is all merely meant to drive a wedge within the ranks of the House GOP conference, and between the House leadership and its rank and file.

Boehner will never accept it, and can’t accept it, as Reid full well knows. As we just noted, it would only split the ranks even more of an already hard to manage GOP House conference. And most of all, it would take away much of the remaining leverage Boehner hopes to use on the debt ceiling.

And furthermore, it is not even a “clean” CR in the sense that it is using the lower annualized House $986.3 billion budget numbers that the House Democrats have already vowed to vote against. Thus if Boehner did put the Senate CR to a vote on the House floor, he would run the additional risk of still losing, being blamed for that and the shutdown continuing, and losing the support of his conference to boot. A triple win for Reid.

This is exactly the sort of dead end Boehner and the House leadership warned the Tea Party rebels could happen and was likely to happen, and is indeed happening. It has so far in this early round of the political battle over the shutdown cost the GOP dearly, as they continue to take a pounding in the media.

And by all accounts, the White House meeting is very likely to serve as yet another photo opportunity to pound away at the same theme of the “extremism” of the House Republicans in allowing its conference to be “hijacked” by a minority Tea Party faction, to which there is of course a grain of truth.

BUT

The GOP House leadership may be weighing the “how and when” to try turning this onslaught around to their favor by broadening out the budget conference offer to discuss the entire arc of the FY2014 budget, including the spending levels and the sequester, as well as potentially adding a separate debt ceiling increase as a parallel bill.

The timing question is probably in waiting for Obama and Reid to overreach and then spring it, so tonight seems unlikely. Boehner is taking a pounding but he is said to be pretty confident the House can ride it out for quite a bit longer.

So this is likely to go on for a minimum a few days as it does seem unlikely Boehner could pull off this shift in the narrative — and to be careful, he may not in fact pull it off or could back down for any of a gazillion tactical reasons in the end — but we will be watching for signs of this emerging as it could be the single biggest game changer in the shutdown/debt ceiling story since the shutdown went into effect.

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