The best part about Washington’s new obsession with scandals is that it seems to have killed any hopes for a grand bargain in the near future. Congress has only so much bandwidth to deal with issues and it looks like most of that time will be consumed by “investigations.” In addition, while Republican are in all out war mode against the administration it is basically impossible to take part in complex compromise negotiations.

President Obama and Congressional Republicans actually view concerns about the deficit in two different ways and that is what has prevented a deal.

Obama for whatever reason actually thinks reducing the long term deficit should be important. He has put forward plans to include spending cuts and tax increase in order to achieve this goal. He has repeatedly tried to tailor his plan to get enough buy in from different groups for it to become law.

The intellectual dishonesty continues. As before, it’s the lie of omission.
R and R are familiar with my book ‘The 7 Deadly Innocent Frauds of Economic Policy’ and, when pressed, agree with the dynamics.

Barak Obama is the first Democratic president to advocate cutting Social Security benefits. Whatever happens next, this is a historic change of direction for his party and an ominous turning point for the American social/economic compact.

While Washington debates cutting Social Security and Medicare the facts are in on the “recovery” – it’s a bust. Not only has unemployment remained historically high – 7.7% officially, 23% by the old metrics – but poverty has spiked to historic highs.

One of the best pieces of news I have seen in awhile is that Sen. Dick Durbin (D-IL) is not very optimistic about a grand bargain being reached. He currently puts the odds at less than 50 percent.

On the tenth anniversary of the war in Iraq it is worth remembering how many people were deeply wrong. Top politicians in both parties, administration officials, reporters, columnists, and even many bloggers. They were wrong about the weapons of mass destruction, about the links to Al-Qaeda, and about how quickly the war would end. Over the past decade basically none of these people have faced any repercussions for being so wrong. In fact many of them are still working at their same jobs or have much better jobs.

One of the big reasons that deficit hysteria gripped Washington for years despite dozens of more pressing issues is that Pete Peterson has spent the GDP of a small country propping it up. According to Joshua Green, Peterson spent half a billion on this current deficit push and plans to spend a half billion more.

The way Obama has handled basically every manufactured crisis from the debt ceiling, to the Bush tax cuts expiration, to the sequester has been about trying to force both Democrats and Republicans to embrace his version of a “grand bargain.” While it is clear this has been the driving force behind Obama’s decisions, if you pay close attention to his actions is is rare than an administration official will directly admit this. This is actually what I think it most interesting about the recently leaked email exchange between Bob Woodward and Gene Sperling up on Politico.

House Republicans really really really hate new taxes. This is one promise from the GOP I do believe. It seems almost everyone from their base, to their donors, to independent voters believe this. Despite a mountain of evidence the only people who don’t seem to believe this are a small circle of professional grand bargain promoters, the “both sides are always equally to blame” pundits, and President Obama.