Why the fiscal cliff debate is like a poker hand — and the GOP is losing a lot of chips
Here’s how I see Speaker John Boehner’s failure to pass his own Plan B tax plan in the House last night:
Some people liken these fiscal-cliff negotiations to playing chess or checkers, as one unnamed, senior House Republican did in this excellent write-up of the post-failure mood in the House by National Review’s Robert Costa. Assuming I understand correctly why and how that metaphor is being made, I think it’s inapt because it suggests this debate is proceeding in isolation from everything else Congress has done in the past and will do in the future.
I think it’s much more like one hand in a game of Texas Hold ‘Em, with the chips representing political capital. With both poker chips and political capital, having more means you have more leverage — because those who have less than you don’t have as much margin for error. They have to play it a bit safer.
This particular game of poker, in which House Republicans face President Obama and the Senate Democrats, has been going on for two years. The GOP had no seat at the table following the 2008 election and had to watch Democrats play each other in hands we’ll call the Stimulus, Auto Bailout and Obamacare. The way those hands went dictated the results of the 2010 elections, which put the House Democrats out of the game and allowed the GOP to buy back in.
Between the 2010 elections and the 2012 elections, there were a few small pots and one big one, for the Debt Ceiling. President Obama and the House GOP both put a lot of chips on the table for that one, but it turned out they were both holding a pair of 2’s and so they split the pot. (In reality, it was a bit more like the chips on the table were vaporized and everyone was worse off politically, but hey, there’s no perfect metaphor.)
Heading into the 2012 elections, each player had roughly the same size pile of chips, and a lot at stake. The victory by Obama and the somewhat larger majorities for Senate Democrats meant the House GOP’s pile was smaller than it was before. They weren’t out of the game by a long shot, but they were staring at players with larger piles. So they had to be very canny with how they played the next big hand, the Fiscal Cliff.
As the players kept making bets, the pot kept getting larger. The House GOP obviously didn’t know which cards the other two players were holding, but it knew its hand was decent — certainly not a royal flush, but we’ll say it was three of a kind (Boehner’s Plan B) with two more cards to be revealed (how Senate Democrats and then Obama reacted if Plan B passed the House). That meant the GOP could possibly wind up with four of a kind and significantly boost its odds of winning the hand.
There were signs the other two were bluffing, especially the confidence Senate Democrats were showing (in saying all day Thursday there’s no way Plan B would pass the Senate, a very good sign Senate Democrats didn’t want to have to vote it down and be seen rejecting steady tax rates for 99.8 percent of taxpayers).
Boehner seemed to believe this hand was his best bet to win more chips and thus leverage for future hands, and he put even more chips in the pot (by rolling out Plan B publicly). But before Senate Democrats could raise or call, he suddenly folded instead. In poker, no one tells the player what he has to do, but in Congress, that does happen to leaders sometimes.
As a result, the House GOP is basically left watching as Obama and the Senate Democrats play out this hand. Republicans now have a lot fewer chips, and even though a lot of them have a good feeling about the cards they’ll be holding when the next hand is dealt — the next round of the Debt Ceiling — there are no guarantees. And, with fewer chips, they’ll have to be even more careful and wily when playing that hand.
Maybe winning a comparatively smaller pot in that next hand will boost the GOP’s odds in the larger game going forward. Maybe someone else will come and sit at the table to play that hand instead of Boehner (I don’t know if the speaker erred by taking his plan public without knowing he had the votes or committed the larger sin of being unable to keep the votes he thought he had, but neither possibility bodes well for his ability to hang on as speaker). Maybe this will turn out well for Republicans.
But I don’t see how.
P.S. — No, my chief concern in this debate is not what happens to the Republican Party. But it seems to me that Democrats now are well-positioned, if they want, to make sure taxes don’t rise for good on people earning less than $200,000 per year ($250,000 for married couples) while raising them on everyone else. While I don’t think that ultimately would be good for the country, it seems likely to me that that’s what will happen at this point no matter what — which is why I’ve focused today on the politics of it all.
(UPDATE at 6 p.m.: I am signing off the blog until after the holidays, so comments will be going through moderation until I’m back on Jan. 2. In the meantime, have a merry Christmas and a joyous start to 2013!)
– By Kyle Wingfield
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168 comments Add your comment
Aesop's Fables and other Lib Economic Theories
December 21st, 2012
12:56 pm
Kyle – I know. So did the House Republicans. That’s why it’s DOA.
Reagan got fooled but some of us have learned.
Politico
December 21st, 2012
12:58 pm
Reagan was fooled by whom?
What spending did he veto?
Kyle Wingfield
December 21st, 2012
12:59 pm
Michael @ 12:55: Remind us, what was Grover’s stance on Plan B?
Aesop's Fables and other Lib Economic Theories
December 21st, 2012
1:01 pm
Reagan was fooled by Tip O’neill. Reagan allowed a modest tax increase in exchange for spending cuts that were never delivered. To this day, the disingenuous liberal contingency (yes, an oxymoron if there ever was one) calls Reagan a tax hiker over it.
Deal with democrats at your own risk.
Aesop's Fables and other Lib Economic Theories
December 21st, 2012
1:04 pm
Oh yeah and they call Reagan a big spender over that too, I forgot.
liberals are pretty pathetic when you think about it.
Just Saying..
December 21st, 2012
1:04 pm
“what was Grover’s stance on Plan B?”
Hypocritical, actually.
Politico
December 21st, 2012
1:04 pm
Aesop
Reagan made the government spend those dollars? Do tell.
Again, did he veto any spending bills?
Over 12 yrs didn’t Reagan and Bush Sr present 9 budgets out of 12 that were actually higher than eventually agreed upon?
Aquagirl
December 21st, 2012
1:06 pm
Ask him what he would ultimately like to do to women who have abortions…
Please, I just ate lunch.
Jefferson
December 21st, 2012
1:07 pm
It’s not a game to adults. Grow up GOP and accomplish something.
Politico
December 21st, 2012
1:09 pm
Aesop
Excuse me, it was 7 times. Do look it up when you have the time?
Aesop's Fables and other Lib Economic Theories
December 21st, 2012
1:10 pm
Over 12 yrs didn’t Reagan and Bush Sr present 9 budgets out of 12 that were actually higher than eventually agreed upon?
Yeah and he rebuilt the military that Dhimmi Karter gutted.
Centrist
December 21st, 2012
1:10 pm
@ Aesop – You may be recalling how George H.W. Bush got taken in when David Stockman convinced him to accept tax increases for promised (and of course never delivered) future spending cuts. Bush lost re-election by changing his slogan from “Read my lips” to “Read my hips”.
House Republicans learned from this, and refused to even pass Plan B yesterday. It is “Deal, or No Deal” for them, and waiting until at least next month is what they will do until there is an overall deal on both taxes and spending.
Georgia
December 21st, 2012
1:11 pm
Sure, Kyle, we followed THAT along. Take a couple weeks. You’re fried, man.
Just Saying..
December 21st, 2012
1:12 pm
“The face saving way out for Boehner is to quietly allow 25 or so lame duck GOP reps to support the discharge petition…”
Of course, THAT’S it! Because the Speaker has throughly demonstrated a remarkable ability to persuade GOP congressmen to vote for legislation that’s not in their personal interest…
JDW
December 21st, 2012
1:18 pm
@Kyle…”Remind us, what was Grover’s stance on Plan B”
Funny how “Plan B” was ok while extending the tax cuts for $250K and under didn’t pass muster….hummmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmm
Politico
December 21st, 2012
1:19 pm
“Yeah and he rebuilt the military that Dhimmi Karter gutted.”
But you just said it was the Dems who reneged. You can’t debate the facts so you deflect to the spending on military.
As for military spending it was already going down under Nixon then Ford. The percentage decrease leveled off under Carter. You can argue it should have went back up, but what you can’t argue with fact is where the decreases started.
Keep swinging. You are going to get a hit one day. It will probably be a foul ball, but at least bat will meet ball.
Try to cheer up and enjoy the holidays.
Aesop's Fables and other Lib Economic Theories
December 21st, 2012
1:19 pm
After weeks of wrangling, O’Neill and the Democrats would not budge on their insistence that raising taxes had to be part of the final deal. To make it more palatable for Reagan, O’Neill offered a three-to-one ratio of spending cuts to tax increases. On that basis — that the deal, on paper, was designed to result in a net shrinking of government — Reagan and enough Republicans signed on, over the strong objections of many anti-tax conservatives in the Republican ranks.
Thus was concluded the Tax Equity and Fiscal Responsibility Act (TEFRA), signed into law in September 1982. In hindsight, Reagan came to see the deal as one of the biggest domestic errors of his presidency. The tax increases went into effect immediately but as Reagan wrote in his memoirs, “later the Democrats reneged on their pledge and we never got those cuts,” so there was no shrinking in the size of government, and no taming of the deficit.
And now they’re supposed to sign up to Plan B without even a false promise?
Aesop's Fables and other Lib Economic Theories
December 21st, 2012
1:22 pm
You deflected, Pol, I was specifically talking about Reagan- O’neill and you dragged HW Bushie into it.
Pardon me for answering your question.
blackbird13
December 21st, 2012
1:22 pm
@Kyle
“While I don’t think that ultimately would be good for the country, it seems likely to me that that’s what will happen at this point no matter what — which is why I’ve focused today on the politics of it all.”
But that’s why chess is the apt metaphor here. Republicans can keep posturing–moving the pieces around–but in the end it’s checkmate. But if gambling is the preferred metaphor: the Republicans in Congress put all their chips on Obama being a one term president when they agreed to the fiscal cliff. They lost the hand on Election Day and have been trying to welch on the bet ever since.
Politico
December 21st, 2012
1:22 pm
Aesop
Let this help you out.
http://www.whitehouse.gov/sites/default/files/omb/budget/fy2009/pdf/hist.pdf
Kyle Wingfield
December 21st, 2012
1:23 pm
JDW @ 1:18: Plan B meant tax rates stayed the same for a lot more people. I don’t know why you’re confused about this. You might not agree with it — heck, I know you don’t agree with it — but I don’t know why you think Grover would like the Obama plan better than the Plan B.
Politico
December 21st, 2012
1:24 pm
Aesop
Take out HW and Reagan still proposed several budgets more than Congress agreed on.
How is that small government?
What spending did he veto?
Why did the government grow under his two terms?
Kyle Wingfield
December 21st, 2012
1:24 pm
blackbird13 @ 1:22: It’s never checkmate, because neither side ever wins an issue forever. Disagree? Take a look at what people were saying about gun control as a politically viable issue just two months ago.
Politico
December 21st, 2012
1:25 pm
Aesop
Great words @ 1:19, but nowhere does it show vetoes on spending.
Why is that?
getalife
December 21st, 2012
1:26 pm
The gop ran out of chips after the election.
I would not be surprised to see our President and senate bail out the speaker.
getalife
December 21st, 2012
1:29 pm
BTW, I don’t think Seniors think it is a game when cutting SS is on the table.
Stop scaring Seniors with your stupid games cons.
Failed the moral test again.
Lil' Barry Bailout -OBAMAPHONE!!!
December 21st, 2012
1:30 pm
Obozo and the Democrats “won the election”…why don’t they just handle it?
Just Saying..
December 21st, 2012
1:31 pm
“Obama, Reid/Pelosi now have all the pressure to come up with something that can pass the House. Boehner showed that an Obama wish list is not going to pass the house, because a watered down Obama wish list (Plan B) couldn’t pass. So, what do you do now, Barry?”
Rafe, Plan B was no Obama wish list of any stripe, and it wasn’t that it couldn’t pass the House, it couldn’t pass the House Republicans.
The bill that ultimately passes will have almost all House Democrats and enough Republicans, absent the Cantor/Ryan cabal. And it will be less than Obama’s last offer to Boehner.
Just Saying..
December 21st, 2012
1:33 pm
“…why don’t they just handle it?”
Barry, be careful what you ask for…
getalife
December 21st, 2012
1:33 pm
The gop refuse to vote to increase taxes but will vote for a tax cut next year.
Lil' Barry Bailout -OBAMAPHONE!!!
December 21st, 2012
1:35 pm
Ending the tax cuts and cutting spending was the price for increasing the debt ceiling. Why does Obozo insist on going back on that commitment?
Just Saying..
December 21st, 2012
1:36 pm
” the Republicans in Congress put all their chips on Obama being a one term president when they agreed to the fiscal cliff. They lost the hand on Election Day and have been trying to welch on the bet ever since.”
Blackbird13, you nailed it.
WAW
December 21st, 2012
1:36 pm
Okay, I’ll stick with poker theme. The hand was dealt over a year ago and the bets were made. The GOP checked, didn’t bet (didn’t hold enough to open) but held a reserve. The cliff was a plan to win the big pot because after the November elections and “anybody but Obama” would be elected with a majority the both houses of Congress coming in January, the GOP would, with a little help from defeated Democrats, rescue everyone from the cliff and take the pot. Two things went wrong; 1) Obama won! 2) Obama not only won but the GOP lost seats in both houses of Congress. Results, GOP ain’t got no chips. They can talk all they want. They can parade around and show their feathers. The game is now right where it was November 7th, call Senate Bill 3412 for an up or down vote (discharge petition is not necessary if the Speaker will call the bill). Accept the fact that Obama will be the President come January. Accept the fact that unless the GOP refutes its Pledges and gets busy working for the citizens, they will loose the House in 2014. The end of the world didn’t come on December 21, the end of the GOP came on November 6,
td
December 21st, 2012
1:36 pm
ByteMe – Got ilk?
December 21st, 2012
12:27 pm
5% tax cut for people making between $50,000 to $75,000 per year will be paid for by eliminating all funds going to planned parenthood
More stoooooopid. I’ll bet td doesn’t know how much money is paid by the Federal government to fund planned parenthood OR how much a 5% tax cut for that particular income bracket costs. Here’s a hint, the tax cut is a many many many times larger.
I totally understand do you understand that restoring all the Clinton tax increases will not even balance the budget? It is a symbolic and puts the screws to the democrats.
Lil' Barry Bailout -OBAMAPHONE!!!
December 21st, 2012
1:36 pm
No vote is required to increase taxes.
Aesop's Fables and other Lib Economic Theories
December 21st, 2012
1:37 pm
Poli – Let’s stay on subject. Today it’s why Republicans were wise not to get swallowed up in another democrat spending spree with their name all over it.
Maybe tomorrow Kyle will write an article about how some modest, targeted government spending in the 1980’s unleashed an expansion of the economy that never had been seen before.
Be sure to check back.
Centrist
December 21st, 2012
1:37 pm
Since Obama has already agreed to move off his $200,000 per year ($250,000 for married couples) tax rate increase, why are Kyle and others posting that Republican House members will have to go back and accept it – makes absolutely no sense – especially when they wouldn’t even accept $1 million yesterday?
The biggest problem I see is that Obama and Boehner may come up with a bargain that a majority of Democrats in the Senate ignore Obama, and a majority of Republicans in the House ignore Boehner. Maybe it will come down to the minority parties in the Senate and House agreeing with the majority leaders – strange bedfellows indeed.
Bob Loblaw
December 21st, 2012
1:37 pm
Please. The Speaker went all-in last night with a 2,7 off suit and got beat by a pair of 8’s. Crazy 8s. Probably positioned to his right at the poker table.
Aesop's Fables and other Lib Economic Theories
December 21st, 2012
1:38 pm
Ooops, excuse me -
Maybe tomorrow Kyle will write an article about how some modest, targeted government spending in the 1980’s —>helped to unleash<—- an expansion of the economy that never had been seen before.
JDW
December 21st, 2012
1:38 pm
@Kyle…”I don’t know why you think Grover would like the Obama plan better than the Plan B.”
I completely understand why he would like it better…what I don’t understand is why one is ok and the other not. Seems hypocritical to me…but then again it is Grover.
Politico
December 21st, 2012
1:40 pm
“targeted government spending in the 1980’s unleashed an expansion of the economy that never had been seen before.”
Keynesian I presume?
hahahahahaaha
Have a great holiday.
Hillbilly D
December 21st, 2012
1:40 pm
I guess since Washington only plays using our stacks the rules that apply to us don’t matter to them.
That’s it, in a nutshell.
It’s never checkmate, because neither side ever wins an issue forever.
Exactly, it’s all about pendulum swings.
My own solution, not that I think there’s a snowball’s chance it’ll ever happen is that no member of Congress nor the President, should receive another paycheck, until a budget is passed and signed. You don’t work, you don’t get paid. Think of it as the John Smith at Jamestown approach.
Lil' Barry Bailout -OBAMAPHONE!!!
December 21st, 2012
1:45 pm
Most of those in Congress would work without pay–the “fringe benefits” are sufficient for most of them.
Politico
December 21st, 2012
1:45 pm
HillyBilly D
Senate should be doing a better job in terms of the budget, but “budgets” have been busted before. Since spending is done via appropriations, they can still spend and spend.
Granted it does provide a known benchmark, however in itself it doesn’t provide an automatic mechanism to stop spending.
Just Saying..
December 21st, 2012
1:47 pm
“…and puts the screws to the democrats.”
Hard to understand those who won’t act in their own interest, Bar?
Politico
December 21st, 2012
1:47 pm
HillBilly D
Should have said Congress as a whole, but recently it has been the one failing because the sides can’t come together on numbers once it gets though the House.
breckenridge
December 21st, 2012
1:48 pm
The problem is that there are too many House republicans who are simply uncompromising ideologues. Those that are willing to negotiate and bargain – in other words do something other than obstruct – have largely been drummed out of Congress. It’s not healthy for the party or the country.
Bargaining has always been part of the equation, starting at the Constitutional Convention in 1787, followed by the momentous Dinner Table bargain between Jefferson and Hamilton in 1790. This idea that “we’re not going to compromise” is just poisonous to the political process.
Politico
December 21st, 2012
1:50 pm
*the Senate has been the one failing……..
Lil' Barry Bailout -OBAMAPHONE!!!
December 21st, 2012
1:53 pm
Republicans did compromise. They raised the debt limit.
Hillbilly D
December 21st, 2012
1:55 pm
Politico
Valid point but we gotta crawl before we can walk, so to speak. Baby steps are better than no steps.