Thursday, December 20, 2012

Plan B fails!

The Republican House leadership finally agrees. They wish Plan B were more widely available. Speaker Boehner's back-up plan was withdrawn tonight when the leadership realized they just didn't have the votes to pass it.

This is being portrayed as a failure for the Speaker, but Plan B was actually a pretty clever gambit on his part. To get more of what the Republicans want out of a budget deal, Boehner proposed an alternate plan better for his side than the plan the speaker and the president were negotiating. Boehner thought he might pressure Democrats to agree, otherwise they might be blamed for the failure of the negotiations. But first he had to get his caucus to support Plan B.

The real failure is of the Republican caucus to back the plan. This failure is almost incomprehensible, given that the only alternatives now are either acquiescence to a negotiated agreement worse from the Republican point of view, or the dreaded fiscal cliff. If we go over the fiscal cliff, Republicans lose all their leverage on tax cuts. Taxes will go up automatically for all Americans. And the only alternative on the table will be the Democratic proposal to reduce tax rates for all but the top 2%. How could the House not bring that up for a vote once all the rates have gone up?

Here's what Representative Dan Burton said about that:
"If we go over the fiscal cliff, the president just comes back and says, 'OK, we're going to give tax cuts to everybody under $250,000.' Who's going to vote against that? Everybody'll vote for that. Everybody. Because it will be just a fait accompli. You won't be voting on whether you're going to do away with a tax cut, you're going to be reimposing tax cuts for everybody under $250,000. So the Republicans are in an untenable situation."
What explains the mentality of the House Republicans who tonight rejected the best option they seem to have in these negotiations? Tonight they decided that none of the available alternatives are good enough for them. That means they might get stuck with a worse alternative. I've seen this mentality sometimes displayed by clients and other participants in settlement negotiations in my law practice. I tried to settle an employment discrimination case a while back, for example, in which the company offered x dollars, but the guy thought he should get more like 5x. The amazing thing was that this plaintiff knew he was almost certain to lose the whole case if he went to trial. He was very clear-eyed about it, and yet still could not accept the company's offer even though it was almost certainly better than any available alternative. It just didn't meet the standards of what he felt he was entitled to. A rational person should always choose x if the only choice is between 0 and x. But people are not all that rational. If they have an unshakeable belief that they are entitled to 5x, they would sometimes rather take 0 than settle for less than they believe is right.

That's what the Republican House majority chose to do tonight. They decided they would rather have a big tax increase imposed on their constituents than compromise their "no tax increase" principles in the slightest. They rejected the possibility of agreeing to the tiniest possible tax increase that their leadership could possibly propose. This is not rational thinking. But it's not surprising either. The real world will find its way of imposing itself on the Republican House majority. But they are not going to be a willing partner to that process. 

To be fair, I should mention that Plan B was probably doomed anyway, since the Democrats in the Senate said they probably wouldn't even have brought it up for a vote. And President Obama threatened to veto it. Still, it's got to be way worse for the Republican bargaining position if they can't even agree among themselves to support the least damaging possible plan to their beliefs. It's like refusing to agree to have your smallest toe amputated, even when you know that you will either die or lost your whole leg if you don't. It's amazing to watch a political party do that to themselves. 


  1. You explain this very well. Tell me Joe, is there a possibility that Boehner knew Plan B would go down? Then, showing the President that they are crazy; the President moves off his last position and offers something else?

    Have you ever been on your bike and a wild dog chases you? They are scary because they act irrationally. Crazy is crazy.

    I still see a deal coming.

  2. I have no idea what was going through Boehner's mind, but your theory is one possibility. I would rather think, though that Boehner believed he could get the caucus to support Plan B. But maybe his fallback position was that if he failed to get it passed, that would demonstrate just how impossible his caucus is, and perhaps he might gain even more concessions that way.

    What Boehner should do is just let the Democrats bring their plan up for a vote, and see how many Republicans support it. But he might lose his position that way, and any Republican who support the deal might get primaried.

    This is all like the perfect storm for me, because it combines my interests in politics and negotiation. And I can't predict how it will end. Very entertaining!

  3. << This is all like the perfect storm for me, because it combines my interests in politics and negotiation. And I can't predict how it will end. Very entertaining! >>

    I couldn't agree more. It is fascinating and your insight is icing on the cake. There could be book or essay material here that would be mulled over in classrooms and seminars on negotiation and mediation one day.