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Defying the Odds

Defying the Odds
New book about the 2016 election.

Thursday, August 22, 2013

Politics of Shutdown and Default

Politico reports:
They’d never say it publicly. But catch many Democrats in an honest moment and they would admit that a Republican-led government shut down this fall might be the best thing — perhaps the only thing — that could revive their fading hopes of capturing the House next year.
As it stands now, the midterm is shaping up as a stale, status-quo election — with Democrats calling their counterparts right-wing extremists, Republicans attacking their rivals over Obamacare and neither side making much headway. That’s good for Republicans, since the party out of power in the White House almost inevitably picks up House seats in the sixth year of the presidency. Heavily-gerrymandered districts provide the GOP an extra layer of protection.
Nothing short of a powerful jolt — a moment that grabs casual voters by the lapels and makes them take notice — is likely to alter the landscape in a dramatic way. A shutdown could be it, Democrats argue, putting in play GOP-leaning districts now thought to be all but out of reach.
“There are no ifs, ands, or buts about it. It would be a boon to us,” said Andrew Myers, a national Democratic pollster. “How could it not be?”
At The New York Times, John Harwood notes another danger for the country and the GOP:
While the sequester pinches particular constituencies, and a government shutdown would inconvenience millions, economists warn that a default resulting from a failure to raise the government’s debt limit could tip the economy back into recession.
Speaking with Politico a few weeks ago, outgoing CEA chair Alan Krueger had a vivid analogy:
The idea of breaching the borrowing cap was “unthinkable,” Krueger said, and he drew comparisons to the recent Syfy movie “Sharknado” in which a freak storm leads to thousands of sharks terrorizing people on land and in the water.

“You have this tornado which brings sharks and they land on people’s heads,” he joked at POLITICO’s Playbook Lunch event. “I think if we cross the debt limit, it would be worse for the financial sector.”