Debt Ceiling Talks: A Great Hollywood Script

When Treasury Secretary Geithner spoke to a local audience last month, he assured us that the ensuing weeks would be filled with dramatic political theater. When the news broke last evening that President Obama was going to enter today’s round of debt negotiations by “offering Social Security cuts,” I thought immediately of the movie theater, and in particular the scene in Bull Durham in which Crash tells Nuke to throw the next pitch at the mascot. It could be that the right narrative to explain this development in the debt negotiations is as The Washington Post reports:

At a meeting with top House and Senate leaders set for Thursday morning, Obama plans to argue that a rare consensus has emerged about the size and scope of the nation’s budget problems and that policymakers should seize the moment to take dramatic action.

As part of his pitch, Obama is proposing significant reductions in Medicare spending and for the first time is offering to tackle the rising cost of Social Security, according to people in both parties with knowledge of the proposal. The move marks a major shift for the White House and could present a direct challenge to Democratic lawmakers who have vowed to protect health and retirement benefits from the assault on government spending.

Or it could be that Obama sees how fired up the Republicans’ conservative base is about holding these negotiations to spending cuts rather than tax increases and is wondering how to get some of that support on his side. Offering up cuts in Social Security could be a strategy to achieve the same outcomes as throwing at the bull. After Nuke throws his wild pitch, Crash tells the opposing team’s batter not to dig in, because he doesn’t know where the next one is going. What I am looking for in response to Obama’s offer is not whether the Republicans accept it but how vehemently and dramatically the Democrats reject it.

About Andrew Samwick 89 Articles

Affiliation: Dartmouth College

Andrew Samwick is a professor of economics and Director of the Nelson A. Rockefeller Center at Dartmouth College in Hanover, New Hampshire.

He is most widely known for his work on the economics of retirement, and his scholarly work has covered a range of topics, including pensions, saving, taxation, portfolio choice, and executive compensation.

In July 2003, Samwick joined the staff of the President's Council of Economic Advisers, serving for a year as its chief economist and helping to direct the work of about 20 economists in support of the three Presidential appointees on the Council.

Visit: Andrew Samwick's Page

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