Boehner 'Plan B' flop: Good or bad for President Obama?

So House Speaker John Boehner whiffed with "Plan B." He couldn’t get the Republican caucus to pass his own bill extending Bush-era tax cuts for all but those with incomes over $1 million. If you’re President Obama, sitting in the Oval Office thinking about the chaos on Capitol Hill, are you happy or sad? Is this good or bad for the administration’s negotiating position?

At first glance it appears to be a happy event for Democrats, politically speaking. Mr. Boehner’s leverage in negotiations might have been increased by House passage of Plan B. He’d have shown that the GOP had a plan of its own to avoid the "fiscal cliff" and blame from voters. Mr. Obama might have had to edge closer to Boehner’s position, giving up more revenue enhancement and promising larger reductions in spending, to produce any kind of grand fiscal deal.

“Obama already had the upper hand in these negotiations – he was reelected just over a month ago – and Boehner knew it. What happened on the House floor Thursday night made a bad bargaining situation for Boehner that much worse,” writes analyst Chris Cillizza on The Fix Washington Post political blog.

With many House conservatives balking at Boehner’s tax plan, the Republican Party appears split and confused. The speaker is the party’s highest ranking elected leader, but he can’t control his own caucus or chamber. It’s hard to see who would replace him, but if a serious candidate emerges it is possible Boehner’s position is in doubt.

“It’s hard to see how Speaker Boehner continues from here – or why he would want to,” writes David Kurtz, managing editor of the generally left-leaning Talking Points Memo web site.

But politics (outside of elections) isn’t necessarily a zero-sum game. It’s possible that Obama this morning is grimly contemplating a rockier road ahead.

For one thing, who is Obama now negotiating with? The speaker? House conservatives? Senate minority leader Mitch McConnell? The White House had hoped for a debt reduction package of $4 trillion or so, spread out over a decade. It now appears there is no general on the other side who can order his troops to rally around such a deal.

Second, what’s the process? Prior to the failure of Plan B, things had been proceeding according in a typical Washington fashion, which is to say, with the predictable conflict and stilted mannerisms of kabuki. Now all is chaos. The House has gone home for Christmas. There might not be enough time remaining to cobble together even a short-term deal to keep deep spending cuts and tax increases from occurring in a fiscal cliff scenario.

Sure, polls show more voters would blame the GOP than the White House if the nation plunges over the cliff. But the post-cliff scenario is unpredictable. Who knows how voters would actually react, especially if the standoff lingers for weeks? Plus, the economy is likely to suffer from even a short cliff plunge. Just wait to see what happens to stock prices.

“The grim reality in Washington is that nobody really knows whether or where there’s a path to avoid the fiscal cliff, in the aftermath of House Republicans’ stunning failure to pass Speaker John Boehner’s Plan B,” writes long-time Wall Street Journal Washington columnist Gerald Seib this morning.

There may be two likely scenarios going forward. In one, Boehner works with the White House to craft a solution that can pass with the support of perhaps half of his caucus, plus House Democrats. Some liberals are happy about the possibility of this coming to pass. Shorn of the need to placate the conservatives, Boehner could tack to the left to get a deal done, in this view.

The other scenario is simply the absence of the first one. Perhaps Boehner will decline to bring forward a plan his own caucus does not support – he remains the most powerful lawmaker in the House, after all. Perhaps he is deposed and replaced by a more ideological GOP leader. Perhaps he planned for Plan B to fail, to demonstrate to Obama where House Republicans really stand.

“Despite all the overheated rhetoric, Obama and Boehner aren’t that far apart on the actual numbers.... The path to a deal remains. The only question is whether the speaker and the president can walk down it together,” writes Chris Frates of the National Journal this morning.