The Price of Politics (52 page)

It would have been easier in the 1990s, he said, during the period when Republicans held the majority in the Congress with Bob Dole as Senate leader and Newt Gingrich House speaker. They had more control. “I could have done a deal with Bob Dole,” the president said as we walked out of the Oval Office. “I could have even done a deal with Newt Gingrich.”

There was one last question. He had faced an economic choice and a political choice, but hadn’t it also been a moral choice about what a president should do in a genuine national crisis?

“Mm-hmm,” he replied. “Well, what I realized was essentially that we were doing enormous damage to the economy and the psyche of the American people, and that this was not the way government was supposed to work. And at this point, during these last few days of the
process, [I] was absolutely convinced that if there was a way to resolve this that would be good for the American people and good for the economy, that the political fallout for me had to be secondary. And that I would willingly lose an election if I was able to actually resolve this in a way that was right. So this was one of those times where, similar to the decision to go after bin Laden, where you have to get out from above your individual self-interests and your political concerns. And that is a tough place to be, but that’s ultimately your job as president of the United States.”

• • •

The debt limit crisis was a time of peril for the United States, its economy and its place in the global financial order. When you examine the record in depth, you cannot help but conclude that neither President Obama nor Speaker Boehner handled it particularly well. Despite their evolving personal relationship, neither was able to transcend their fixed partisan convictions and dogmas. Rather than fixing the problem, they postponed it.

Though there were brief interludes when the president and the speaker considered real entitlement cuts and tax increases, at least through tax reform, too much got muddled. I believe their discussions about a grand bargain were sincere. But when they met resistance from other leaders in their parties, they did not stand their ground.

Obama and Boehner met privately a number of times in the negotiations in early July—the Merlot-and-Nicorette summits—but then they let the bargaining on key spending and tax issues take place at the staff level. The result was an exchange of mind-numbing written offers and counteroffers, the details of which readers have been spared. I know from my interviews with the president and the speaker that neither of them fully understood the details or the ramifications for budgets and people.

Most extraordinary was the repeated use of the telephone for critical exchanges. Especially baffling was President Obama’s decision to make his critical request for $400 billion more in revenue in a spur-of-the-moment phone call. The result was a monumental communications
lapse between the president and the speaker at a critical juncture. They still disagree vehemently about what was said and what it meant.

It is a fact that President Obama was handed a miserable, faltering economy and faced a recalcitrant Republican opposition.

But presidents work their will—or should work their will—on the important matters of national business. There is occasional discussion in this book about Presidents Reagan and Clinton, what they did or would have done. Open as both are to serious criticism, they nonetheless largely worked their will.

Obama has not. The mission of stabilizing and improving the economy is incomplete. First, the short-term federal fiscal problem has not been solved. Instead it has been pushed off to the future, leaving the United States facing what is now called the fiscal cliff: By law, some $2.4 trillion in spending cuts must begin in 2013, along with an increase in income and payroll taxes. Just the cuts in the first year would amount to $240 billion, or nearly 25 percent of general discretionary spending—a staggering, unprecedented amount.

Second, the long-term problem of unsustainable entitlement spending on Medicare, Medicaid and Social Security, highlighted by Republican House Budget Chairman Paul Ryan and familiar to all informed politicians and economists, including the president and Boehner, has been left largely unaddressed. The combined cost of the three programs in 2012 is about $1.6 trillion. The Congressional Budget Office projects that will nearly double in 10 years to $3 trillion.

Boehner also was responsible. The federal debt issue, he told me, bothered him before he got to Congress 22 years ago. “And I’m sure as hell going to do something about it,” he said, adding that the cause was more important than the job.
²⁷⁸
“I need this job like a hole in the head,” he said, adding he would have been willing, even happy, to risk his speakership for that cause. But he never closed the deal with the House Republicans and established firm leadership. He could have called Eric Cantor in and had the conversation of a lifetime, put it on the line with the man he thought was working against him. He could have said something along the lines of “You or me.” Instead, he tried
to sneak a debt ceiling deal past Cantor, the other Republican leaders in the House, and Senate Minority Leader McConnell.

The monster federal debt and annual deficits come from two problems: continued spending increases and no cuts; and too little tax revenue.

In three and one half years, Obama, the Republicans and the Democrats never really cut any significant spending. Instead, they passed laws agreeing to cut spending in the future beginning in 2013. They also never raised taxes.

These Washington leaders were risk averse. There was so much effort, most of it sincere, but so little result. Americans are now left with a still struggling economy in the midst of a presidential election. It is a world of the status quo, only worse.

This book is based almost entirely on my own reporting, interviews and review of documents and meeting notes.

My thanks go to all sources, named and unnamed, for their time, their willingness to provide me recollections of their experiences, their assessment and context, and in some cases backup notes and documentation.

This is my 17th book with my editor Alice Mayhew, book lover and idea machine, at Simon & Schuster. I am grateful for her expertise, her swift and sure editing, and her invaluable advice. My thanks, too, to Jonathan Karp, publisher, for his hands-on management at each crucial stage; and Carolyn K. Reidy, CEO, for her steadfast support.

At Simon & Schuster, I am also grateful to Michael Selleck, Executive Vice President, Sales and Marketing; Irene Kheradi, Vice President and Executive Managing Editor; Jackie Seow, Vice President and Art Director; Tracey Guest, Director of Publicity; Elisa Rivlin, S&S Counsel; Twisne Fan, Senior Director of Production; Nancy Singer, Director of Interior Design; Joy O’Meara, Design Director; Lisa Healy, Senior Production Editor; Jonathan Cox, Editorial Assistant; Martin Karlow, proofreader; and Susan Gamer, cold reader.

My thanks to Fred Chase, copy editor extraordinaire and counselor to the author and his assistants. He spent 10 days in Washington
working with us. Fred’s steady presence, wisdom, sharp eye, and ability to roll with the punches helped make this, our seventh book together, a genuine pleasure.

My friend Christian Williams spent more than a week in Washington reviewing the manuscript at an early stage. I’m grateful for his input and insights, which proved most valuable.

As always, Carl Bernstein, my former colleague and co-author on the Nixon Watergate story, provided sound advice and many ideas. I thank him for his assists and friendship. Special thanks as well to my friends Rick Atkinson and David Maraniss.

Many thanks to Kate Mertes and Richard Shrout for their indexing expertise.

My continuing admiration and many thanks go to Marcus Brauchli, Katharine Weymouth, Don Graham and Steve Luxenberg at
The Washington Post
.

I’d like to extend a note of special appreciation to MaryAnne Golon, Wendy Galietta and Marlon Correa at the
Post
for their swift and invaluable assistance supplying many of the photographs used in this book.

No project like this starts in a vacuum. In this case, it was filled by reporting and analysis done by countless reporters at
The Washington Post
,
The New York Times
,
The Wall Street Journal
,
Politico
,
Roll Call, The Hill
, the
Los Angeles Times
, the Associated Press, and many other news organizations. The contours and, at times, details of this story appeared in these publications.

Of particular relevance were a March 18, 2012, piece in
The Washington Post
, “He Promised Change in Washington. Then the Debt Deal Collapsed. So Obama Changed Course,” by Peter Wallsten, Lori Montgomery and Scott Wilson, and an April 1, 2012,
New York Times Sunday Magazine
piece, “The Game Is Called Chicken,” by Matt Bai.

Robert B. Barnett—agent, attorney, friend—provided invaluable help, as always. He is a unique presence and force in Washington, D.C. Because he represents President Obama and other political figures, he did not see this book until it was printed, nor was he consulted on its contents.

Rob, Evelyn and I share a deep gratitude for the kindnesses done and cares taken by Rosa Criollo and Jackie Crowe.

Tali, my eldest daughter, was not able to help edit this book because of the rushed production schedule. She, her husband Gabe, and their daughter, Zadie, my first and only granddaughter, are in our thoughts daily.

My daughter Diana, who is in her sophomore year of high school, matures daily and shows a remarkable love of learning and books.

This is the 14th book my wife, Elsa, has guided me through in our three decades together. All that makes sense in life, she provides—devotion, friendship and love.