Democrats want to preserve the legacy of the New Deal and the Great Society — Social Security, Medicare and Medicaid — and add to them what every other advanced country has: a more or less universal guarantee of essential health care. Republicans want to roll all of that back, making room for drastically lower taxes on the wealthy. Yes, it’s essentially a class war. ...Paul Krugman, NYT
The irony is that many of the most fervent class warriors aren't of the class they're fighting for. And that's what's the matter with Kansas. We have among us people who are so deliberately underinformed that they fight for a corporate-fed fantasy while leaving their own interests to die of neglect.
So far Democrats -- the realists -- are winning but only for now. It was a tactical win and possibly temporary. It's possible that Obama will give away our win, at least in part, by allowing the erosion of New Deal's deal. It's almost certain the Republicans will go to war again,"Why are many progressives — myself included — feeling very apprehensive?" Krugman asks. "Because we’re worried about the confrontations to come."
According to the normal rules of politics, Republicans should have very little bargaining power at this point. With Democrats holding the White House and the Senate, the G.O.P. can’t pass legislation; and since the biggest progressive policy priority of recent years, health reform, is already law, Republicans wouldn’t seem to have many bargaining chips.
But the G.O.P. retains the power to destroy, in particular by refusing to raise the debt limit — which could cause a financial crisis. And Republicans have made it clear that they plan to use their destructive power to extract major policy concessions. ...Krugman, NYT
In other words, progressives have won a clear tactical victory, but we continue to win? There's a significant chance that we won't.
At his blog, and in a less formal tone, Professor Krugman adds these bulletins on 2014 and on Geithner.
Politico reports that Democrats are planning to run against Congressional Republicans by portraying them as incapable of acting responsibly, of creating “chaos”.
This line of attack has the virtue of being true; the 112th Congress was the Worst Congress Ever, and it wasn’t because of the Democrats. But it will be an uphill struggle, essentially because the news media still, after all these years, can’t bring themselves to abandon “balanced” reporting in which every GOP sin must be matched with an equal Democratic sin, even if the latter has to be invented out of thin air. Can the message break through that fog of confusion? ...Krugman, Economics and Politics
Bloomberg reports that Tim Geithner will leave before the debt ceiling crisis hits. I hate to say this, but I find this reassuring. While I have no insider information here, I’ve had the sense that Geithner has consistently been a voice urging the president to cave in for fear of upsetting the markets, with no real concern for the dangers of giving in to blackmail. His departure makes it at least somewhat more likely that Obama will stand his ground. ...Krugman, Economics and Politics