Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
It seems to me that Obama has essentially won the battle over the debt ceiling, and barring the (not insignificant) possibility of a Republican leadership cock-up, the Republicans will raise the debt ceiling at least temporally for very little gain. They will even try to represent themselves as the "responsible party" for doing this.

The problem for Obama is that the longer the Government shutdown continues, the more real pain ordinary Americans will feel, and the more disillusioned they will become with all politics - always a plutocratic objective, as it will make the world safe for total corporate control.

Obama has very little leverage to force them to the table on this bar the toxic opinion polls, which mean almost nothing this far out from the election: the whole crisis can be re-spun by the right wing media machine in about three months of sustained anti-dem propaganda.

So the challenge for Obama is to mix and merge the two crises into one, making the Government shutdown and the debt default almost into the one and the same crisis which can only be solved by s combined clean Continuing resolution and debt ceiling increase. He can't very well "solve" the debt ceiling crisis by a purely "financially engineered" solution because that would totally undermine all his warnings that a debt default is a VERY BIG DEAL and almost the end of the world. The teabaggers who said it wasn't a big deal would be vindicated and the Presidents credibility fatally undermined.

So he may very well respond to an actual default by a combination of some of the solutions suggested here AND a series of dramatic and difficult to reverse Government cutbacks which he may well want for other reasons but which he could never publicly support and which would absolutely terrify the GOP and the plutocrats. Think:

  1. Delay in payment to all Government and military contractors - say from 30 days after invoice to 90 days. Cancelling some high profile and high cost/low utility programmes like F36 fighter.
  2. Accelerated withdrawal from Afghanistan and mothballing of some military bases in (say) Germany.
  3. Closure of some private sector prisons and paroling of many thousands of prisoners convicted of non-violent crimes or nearing the end of their sentences.
  4. Temporary end of military aid to Israel and curtailment of NSA programmes.

The great weakness of the Republican position is that the President ultimately has the power to decide how to prioritize spending in a post default world, and can do so in a way which maximises the damage to the Republican base and plutocratic supporters whilst protecting the Democratic base.

They can (and almost certainly will) try to impeach the President afterwards, but good luck with the trial in the Dem controlled Senate. Democratic unity will be sealed for a generation and it will be the GOP which will splinter into many parts.

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by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Mon Oct 14th, 2013 at 06:50:21 AM EST

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