Obama is not providing the leadership the US needs

The President is staying firmly on the sidelines, in the face of another potential financial crisis.

There will be no President Bartlett moment -- no West Wing style last minute drama as the commander-in-chief lays down the line to a bickering Congress. This President is staying firmly on the sidelines.

The White House spokesman, Jay Carney, has talked of plenty of backroom conversations and top level meetings. However, the face of the debt ceiling crisis negotiations is not Obama's, but Republican House Speaker John Boehner's. After the President's attempt to broker a deal with him failed late last week, the administration's efforts are now being led by Joe Biden, while Treasury Secretary Tim Geithner is busy planning for the worst case scenario: not reaching an agreement to raise the debt ceiling in time. There isn't even a White House "war room" to deal with the crisis.

It's got pundits on all sides claiming that President Obama is in danger of looking like a spectator at the funeral of his own economy. In the meantime, it's Boehner's deficit reduction plan in the spotlight -- his Bill in front of the House, his responsibility to bring reluctant Tea Party hardliners into line. If the measure does pass today -- and at the moment it's deemed "too close to call" -- Democrats have pledged to defeat it in the Senate. President Obama says he'll veto it. But then who would look like they were the ones tipping the nation into that "catastrophic" default? Obamagaddon, indeed.

In this intricate game of political chess, with the fate of the most powerful economy on earth at stake, has the White House lost the initiative? Remember healthcare? That long summer of 2009 when Obama sat back and somehow let the narrative get overtaken by the conservative right? Even the rival plan, piloted by Boehner's opposite number Harry Reid, has dropped the commitment to tax hikes as part of the debt ceiling solution, although it does at least ring-fence entitlements like Medicare.

But liberal disappointment is rife. Here's Democratic Rep Peter Welch: "The House Republicans have been successful in getting two plans, Boehner and Reid, that are all cuts, no revenues, and a debate about doing this all at once or in two stages. The Democratic approach was a balanced approach. We lost."

It is true that the plan that Boehner is promoting has exposed the deep fault-lines within his own party, with a sizeable number of Tea Party activists refusing to sign up to any compromise at all. But President Obama has his own unity issues, with liberals frustrated that he appears to have conceded quite so much ground in what looks like an effort to appease the conservative right. One "senior party operative", quoted on Politico, bemoans the situation: "Every policy outcome for liberals is a loss at this point...We may win on trhe politics, but the policy battle is lost. It's just depressing."

Look at the latest polls, and they do show that most Americans blame the Republicans for the gridlock. After all, Obama did inherit a $1.2 trillion budget deficit -- and it was his predecessor George Bush who was behind the tax cuts and wars which made that deficit so much steeper.

"Call your Congressmen," Obama told the American people on Monday, and worried families have been bombarding Capitol Hill with phone calls. But Obama's own popularity ratings have slipped back over the last month, while the numbers who think he's doing a good job on the economy have slumped. Of course, some 75 per cent of Democrats are still rallying behind their leader, but goodwill can't automatically be taken for granted. And heading into 2012, active support from the grassroots -- not to mention party donors -- will be crucial in those battleground states.

And what the White House wants to avoid at all costs is putting Obama's neck on the line if there's no last minute compromise on the debt ceiling. He's already been strongly advised not to invoke the 14th amendment to force through an increase. "Believe me, the idea of doing things on my own is very tempting," he said earlier this week. "But that's not how our democracy functions".

But in the face of another potential financial crisis -- and real pain for millions of Americans -- what the country is looking for is leadership. And now, more than ever, it's their President's chance to provide it.

 

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After Article 50 is triggered, what happens next?

Theresa May says Article 50 will be triggered on 29 March. The UK must prepare for years, if not decades, of negotiating. 

Back in June, when Europe woke to the news of Brexit, the response was muted. “When I first emerged from my haze to go to the European Parliament there was a big sign saying ‘We will miss you’, which was sweet,” Labour MEP Seb Dance remembered at a European Parliament event in London. “The German car industry said we don’t want any disruption of trade.”

But according to Dance – best known for holding up a “He’s Lying” sign behind Nigel Farage’s head – the mood has hardened with the passing months.

The UK is seen as demanding. The Prime Minister’s repeated refusal to guarantee EU citizens’ rights is viewed as toxic. The German car manufacturers now say the EU is more important than British trade. “I am afraid that bonhomie has evaporated,” Dance said. 

On Wednesday 29 March the UK will trigger Article 50. Doing so will end our period of national soul-searching and begin the formal process of divorce. So what next?

The European Parliament will have its say

In the EU, just as in the UK, the European Parliament will not be the lead negotiator. But it is nevertheless very powerful, because MEPs can vote on the final Brexit deal, and wield, in effect, a veto.

The Parliament’s chief negotiator is Guy Verhofstadt, a committed European who has previously given Remoaners hope with a plan to offer them EU passports. Expect them to tune in en masse to watch when this idea is revived in April (it’s unlikely to succeed, but MEPs want to discuss the principle). 

After Article 50 is triggered, Dance expects MEPs to draw up a resolution setting out its red lines in the Brexit negotiations, and present this to the European Commission.

The European Commission will spearhead negotiations

Although the Parliament may provide the most drama, it is the European Commission, which manages the day-to-day business of the EU, which will lead negotiations. The EU’s chief negotiator is Michel Barnier. 

Barnier is a member of the pan-EU European People’s Party, like Jean-Claude Juncker and German Chancellor Angela Merkel. He has said of the negotiations: “We are ready. Keep calm and negotiate.”

This will be a “deal” of two halves

The Brexit divorce is expected to take 16 to 18 months from March (although this is simply guesswork), which could mean Britain officially Brexits at the start of 2019.

But here’s the thing. The divorce is likely to focus on settling up bills and – hopefully – agreeing a transitional arrangement. This is because the real deal that will shape Britain’s future outside the EU is the trade deal. And there’s no deadline on that. 

As Dance put it: “The duration of that trade agreement will exceed the life of the current Parliament, and might exceed the life of the next as well.”

The trade agreement may look a bit like Ceta

The European Parliament has just approved the Comprehensive Economic and Trade Agreement (Ceta) with Canada, a mammoth trade deal which has taken eight years to negotiate. 

One of the main stumbling points in trade deals is agreeing on similar regulatory standards. The UK currently shares regulations with the rest of the UK, so this should speed up the process.

But another obstacle is that national or regional parliaments can vote against a trade deal. In October, the rebellious Belgian region of Wallonia nearly destroyed Ceta. An EU-UK deal would be far more politically sensitive. 

The only way is forward

Lawyers working for the campaign group The People’s Challenge have argued that it will legally be possible for the UK Parliament to revoke Article 50 if the choice is between a terrible deal and no deal at all. 

But other constitutional experts think this is highly unlikely to work – unless a penitent Britain can persuade the rest of the EU to agree to turn back the clock. 

Davor Jancic, who lectures on EU law at Queen Mary University of London, believes Article 50 is irrevocable. 

Jeff King, a professor of law at University College London, is also doubtful, but has this kernel of hope for all the Remainers out there:

“No EU law scholar has suggested that with the agreement of the other 27 member states you cannot allow a member state to withdraw its notice.”

Good luck chanting that at a march. 

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.