James Pethokoukis has been following the debt reduction/debt ceiling negotiations with the same concerns (and even the same Reykjavik analogy) that we have expressed here. His update on John Boehner’s “Reykjavik moment” is most notable for the message he quotes from a GOP congressional source describing the White House’s approach in the negotiations:
Their fierce insistence on higher taxes is beyond bizarre. After months of demanding “clean” increase to avert economic calamity (default), WH threatens economic calamity (default) unless they get economic calamity (trillions in tax hikes). No wonder these guys are governing over an economic calamity (9.2% & growth malaise), w/ an economic calamity on the horizon (debt explosion as mapped out in president’s budget). The bipartisan consensus on tax reform (broader base & lower rates) was championed by President’s fiscal commission, and yet now is being rebuked by the President. Lowering top rates that would help make America more competitive was too large a leap for a true class warrior.
Pethokoukis himself comments on Obama’s movement backward in the negotiations:
[A]s negotiations wore on, Obama got tougher on taxes (pushed hard by the hard left), and the deal he was cooking up almost certainly wouldn’t have been revenue neutral as he tweaked rates and reduced tax deductions. Not even close. Nor did it help that Obama reportedly balked at a spending-cut trigger if certainly tax reforms were not completed.
The rest of Pethokoukis’s commentary is worth reading, but I highlight these elements because the course of events that we have been following in Minnesota has served to foreshadow them.