After Another Loss for Obama, Dem Doubts Deepen on 2012

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Obama Goes 0 for 3 With GOP

"We have now had at least three or more experiences of the president explaining to people that he has a plan and it is under control but the results don't match. He has an unreasonable Congress that doesn't respond to reason. So why continue to reason with them?"

-- Former SEIU President Andy Stern to the Huffington Post.

Since the 2010 election, President Obama has thrice tussled with Republicans in Congress and thrice he has lost, each time worse than before.

There was the lame-duck deal on extending current tax rates in December in which Obama traded away a core campaign promise for a short-term extension of long-term unemployment benefits.

Then there was the battle over the continuing resolution that is currently funding the government. While Obama stalled for a better deal, Republicans whacked $6 billion in short-term cuts to spending and then a longer, but hazier deal on future outlays. There, Obama avoided a government shutdown and got nothing much but the chance to kick the can on the final round of cuts.

Now, Obama is walking away with, yes, the largest increase in the federal borrowing limit in history (not a wholly attractive thing, politically) and another government shutdown avoided, but nothing else. Republicans, meanwhile, got caps on spending now, a vote on a balanced budget amendment and a cuts commission to find more savings still.

The Senate will, barring a last-minute crack up, pass the plan early this afternoon. While this government shutdown deadline was fungible -- owing to the fact that it was literally about being out of money, not reaching the end of a spending bill – today was the day set by the administration as “Armageddon,” also known as a partial government shutdown.

In each confrontation, Obama has proven less able to combat Republicans. This may have something to do with the fact that the administration really does seem to believe, as Vice President Joe Biden said, that conservative Republicans really are terrorists with nuclear weapons.

What politician wouldn’t like for his opponents to believe that? It’s like the 1979 Steelers. They won all their games when the teams were still in the locker room.

Liberals are beginning to suspect that Republicans have been bluffing all along. The New York Times today trumpets that Tea Partiers in Congress were divided and seem to be actual lawmakers with competing interests and ideas. This is part of what Jonah Goldberg has dubbed the “conservatives in the mist” phenomenon, when establishment media outlets examine the strange ways of right America and find them nearly human. But it is also part of a larger message to the White House: stop backing down.

But the math for the administration is still pretty gloomy, whether there are competing strains of libertarian conservatism or not.

Speaker John Boehner needed 53 Democrats to pass the debt-ceiling deal he hammered out with Obama and Senate Democrats, but he got 95.

Though no one would have liked testing this proposition, it looks like Boehner might have gotten the 216 votes he needed with just Republicans and moderate Democrats.

That means that the handful of votes from liberals like Minority Leader Nancy Pelosi and Rep. Sheila Jackson Lee, R-Texas, were symbolic, not crucial for delivering Boehner his victory.

This means that Boehner, rather than being broken by the challenge for the right, has been strengthened by the process. As Republicans head into the fourth and fifth confrontations with Obama – the end of the current fiscal year on Sept. 30 and then the December deadline for the super committee that will be created by the debt ceiling deal – the House GOP is looking a lot more united than Democrats.

That’s why weakness is such an insidious thing for presidents. The perception of weakness leads to disloyalty as members of the chief executive’s party start looking to save their own skin in the coming elections. That disloyalty, in turn, leads to more weakness and, well, you know the rest.

Obama’s best way to get re-elected is to get everybody again believing that his re-election is inevitable. With Democrats seeing him getting rolled by Boehner and lugging a 40 percent job approval rating and presiding over a crumbling economy, he looks like he will stay on his losing streak. He’s got to get his mojo back.

That’s why he’ll be back in Chicago on Wednesday for a “birthday party” that is actually a massive fundraiser for his struggling campaign. The visuals will not be good – the president jumping out of the smoking wreckage of Washington – for a huge, partisan cash grab, but it is unavoidable. If Obama cannot continue to rack up huge fundraising numbers, the current perceptions of weakness will only deepen.

Right now, money is about all he has going for him.

Wall Street Has Bigger Problems than Congress

"It does remind you that there's more going on than just D.C. and that ultimately you have to take into account the real economy."

-- Brett Rose, head of U.S. rate strategy at Citigroup Global Markets, speaking to the Wall Street Journal on a disappointing day in markets.

There was a whiff of disappointment in Washington that Wall Street had a downish day even after all of the news about a bipartisan debt deal.

Where’s the relief bounce, the politicians wanted to know?

This follows weeks in which lawmakers kept waiting for bond-rate explosions or securities panics to force Washington into a deal. Many Democrats assumed that their final position would be strengthened by an uproar among investors and capitalists, and yet none came.

Democrats seemed to be almost yearning for the bond vigilantes to strike, but they never came.

Power Play can offer three reasons why: First, the smart money on Wall Street and overseas assumed there would be some deal in the end. Second, most of the rest of the planet being such a fiscal mess makes our trashy fiscal system look as orderly as a Swiss bank vault. Third, the real economy is so bad that it is overshadowing the government.

Monday started out with a relief rally, but then manufacturing growth numbers for July revealed the worst performance for the sector in more than two years. Investors expected a soft showing, but this was dire. Following bad earnings for consumer products manufactures like Sony, and coupled with negative outlooks on consumer confidence, investors fled.

While there may be a relief rally again today – especially since the major credit raters are backing away from their downgrade threats – the rest of week will likely bring more bad economic news in the form of July’s jobless report.

Plus, there’s a downside to the deal on debt. Investors loooove stimulus spending because it produces predicable GDP upswings. They also hate regulatory uncertainty because it prevents them from making medium and long term plays.

In the post-midterm Obama era, investors and capitalists see lots of regulatory concerns looming from pending bank rules, Obama’s health care law and the EPA, but none of the stimulus spending that they liked so much.

Obamism sans stimulus is a double downer for markets.

Biden Wipes Out “Elevated Discourse” Argument

"What happened was there were some people who said they felt like they were being held hostage by terrorists. I never said that they were terrorists or weren't terrorists, I just let them vent. I said even if that were the case, what's been happening when you now have taken and paid the debt and move that down so we can now discuss, the nuclear weapon's been taken out of anyone's hands."

-- Vice President Joe Biden in an interview with CBS News when asked about reports that he said conservative House members “have acted like terrorists.”

While Vice President Joe Biden insists that the word “terrorist” did not pass his lips when he was describing House Republicans, he does allow that he accepted the characterization by other Democrats in a House caucus meeting and even added the image of a nuclear-armed terrorist.

That did a little something to diminish the return of Rep. Gabby Giffords, D-Ariz., who is still recovering from being shot in the head by a madman in January.

President Obama and Democrats had embraced Giffords’ shooting as a teachable moment about the need to elevate the political discourse and not use violent rhetoric to talk about opponents. This was directed at the same Tea Partiers who Biden characterized as terrorists holding weapons of mass destruction.

The message in January was that maybe all this overheated Republican rhetoric didn’t lead to Gifford’s shooting, but hey, it could cause problems because the shooting proved that there are some seriously crazy people out there.

Power Play suggests that Biden’s analogy and Gifford’s return on the same day points to the general unworthiness of “teachable moments” that require explanation. It would have been worthier to have mourned the dead and perhaps examined mental health laws, especially as they relate to firearm purchases and involuntary commitments, but talking about “the discourse” was a contrivance and a cop out.

Like a joke, if you have to explain a “teachable moment,” it isn’t working.

And Now, A Word From Charles

“You don't win or lose elections on process. You win and lose them on substance. And the substance is debt. And who put it on the table? Tea Party Republicans, the conservatives. At the State of the Union address the president didn't even have the word "debt" until almost an hour into his speech. Right now it's the first word out of everyone's mouth. It will be on the table, and the fact that Obama's has increased it by $4 trillion is a major issue. And the fact that Democrats have at every turn attempted to restrain the cutting, to restrain the attempt to put a hold on spending, all of that, protect constituencies, that will be remembered.”

-- Charles Krauthammer on “Special Report with Bret Baier.”

***Today on “Power Play w/Chris Stirewalt,” Chris and Fred Barnes of the Weekly Standard go through the political and economic aspects of the debt deal and explore whether it will ultimately help with the nation’s debt problem. Don’t miss a minute at 11:30a ET at ***