Arizona Sen. Jon Kyl was the last Republican to walk away from the bipartisan debt negotiations. When last heard from, Kyl was sticking to the GOP line that any tax increase would be catastrophic to economic recovery, despite mountains of evidence that he's completely wrong.
We observed yesterday that Kyl's comments were evidence of the GOP's economic delusionals. Really, if a senator who isn't even seeking reelection can't say the truth, who in the GOP can face reality?
Slate's John Dickerson says there's nothing to worry about. This is all part of the dance:
Given the state of politics in Washington today, and the stakes in this debate, the breakdown in talks was a foregone conclusion. "We are at the impasse stage," said one administration official. It was always expected that Biden and congressional leaders would work as hard as they could, then cede the final round to President Obama and Boehner. That's where we are now, just as we were in the fight over the Bush tax cuts at the end of last year, and just as we were in the negotiations last spring over the continuing resolution to keep funding the government for this year. The leaders of the two key factions (along with their sidekicks, Senate Majority Leader Harry Reid and Senate Minority Leader Mitch McConnell) will now have to work with the wonks doing the math and figure out which final set of compromises will be palatable to their party.
Before the final stage of backroom negotiations, there are always the denunciations, charges of unseriousness, and accusations of ideological rigidity. Why do we always come to this stage? It's a negotiating tactic, an educational exercise, and stage management. Anyone putting together a deal knows the value of seeming inflexible. Maybe you'll win concessions from the other side. Republican leaders must make a show of how difficult they are to impress their members and constituents. If a deal happened with Biden in a room and there wasn't any public outcry, conservatives would have every right to be suspicious that Republicans got rolled.
Democrats need the blow up for similar reasons. The moment allows them to try to paint Republicans as captive of their unpopular Tea Party wing, which might lower the expected level of spending cuts, or at least rearrange them if Republicans feel the heat. Both sides also need the debate to play out in public so that everyone can fully understand why an ultimate deal was the best one leaders could get.
TNR's Jonathan Chait says Big Business will have to weigh in to push the GOP into avoiding fiscal calamity:
Gaming out the debt ceiling talks, it seems to me that the most important power dynamic is whether the business community can and will pressure Republicans in Congress to cut a deal. Without business pressure, the GOP has zero incentive to agree. Agreeing means making substantive concessions that enrage the base and potentially end the career of anybody who votes for it. Not agreeing probably means precipitating some kind of financial crisis that harms the economy and thus improves the party's prospects in 2012. Hike taxes or beat Obama? That's a very easy call for Republicans.
The only thing that changes the calculation is if the business lobby, which would sustain enormous collateral damage in the default scenario, intervenes. The extent to which this occurs is far from certain. But we probably need to reach a point where default appears likely before business reacts and forces Republicans to bargain. Otherwise, the incentive isn't there.