How Joe Biden fooled the Republicans Japan decides to extend the life of nuclear reactors

Donald Trump prides himself on being the best negotiator of all time and even wrote a book about it, The Art of the Deal. In practice, however, his track record looks mixed. As a businessman, he has made billions from his casinos, and politically his achievements are modest.

Joe Biden would hardly have made a career as a car salesman. He is a poor speaker, gets confused over and over again, often seems a little confused, stumbles up the stairs and falls off his bike. But make no mistake: this man is a brilliant negotiator. Despite the most difficult circumstances, he pushed more important bills through Congress than any postwar president before him.

And now Biden has delivered his masterpiece. In the coming days, he will get Congress to raise the debt ceiling for two years. This will prevent catastrophe for the US and the global economy. But first a quick review:

The debt ceiling is a law known only in the United States. It enables the House of Representatives to vote on whether or not to approve expenditure already incurred. If this promise is denied, the US will have to declare bankruptcy and thus be unable to service its debts. However, so far the Americans have always fulfilled their obligations. That is why the US Treasury bonds, the T-Bonds, are probably the most important instrument in the financial markets.

The debt ceiling should not be confused with the budget negotiations. Congress can also refuse to pass a budget, but the president can veto it. In this case, the state can no longer pay its employees and must partially close the administration. He can, however, continue to fulfill his obligations towards his creditors. A government shutdown, while annoying and as necessary as a goiter, is far less catastrophic than a refusal to raise the debt ceiling.

Biden knew he would have to compromise

So now to the current situation. The Republicans won the midterm elections, much less clearly than widely expected, but still. They have a razor-thin majority in the House of Representatives and therefore the ability to refuse to raise the debt ceiling.

Biden was aware that even with this razor-thin majority he would eventually have to close a deal and that this would be a more than delicate matter. Theoretically, there is a passage in the 14th Amendment to the Constitution that gives the president the ability to avoid national bankruptcy, at least in theory. In practice, however, this has never been attempted, and Biden had little desire to be the first to try, especially with a Supreme Court dominated by conservative justices behind him.

So the president resorted to a ruse. As early as January, he announced that he would definitely not go into a deal to raise the debt ceiling. After all, it is about paying off debts that have already been incurred, in large part by his predecessor Trump. In his tough but understandable stance, Biden received broad support from all non-conservative media outlets and his party. Chuck Schumer, the Democratic Senate Majority Leader, echoed this refusal like a mantra, demanding a “clean deal,” meaning an unconditional increase in the debt ceiling.

The Republicans played their part well. Kevin McCarthy, their leader in the House of Representatives, succeeded in passing legislation that raised the debt ceiling, but on terms the Democrats could never have accepted. But this bill gave McCarthy a chance to publicly pose as a responsible statesman.

Biden watched this goings on for months and accepted that he was seen as a weakling. In fact, he even seemed to nod. Suddenly ready to negotiate, he met McCarthy in the Oval Office and sent his two negotiators, the smart, experienced Steve Ricchetti and the charming young mother, Shalanda Young. With success: you managed to close a deal that can now prevent a state bankruptcy at the last minute.

How did this become possible? Because Biden has allowed his opponent to present himself to his party as the man who controls the “own the libs” game, who has brought Biden to the negotiating table and forced his will upon him.

This is visually correct, but not substantively. Apart from a few crumbs, the Republicans have achieved absolutely nothing. Some reductions on social benefits that are compensated elsewhere. A brief delay in increasing the IRS budget and committing to a pipeline that Biden had long promised to Joe Manchin. That is it.

Things look very different for Biden. Its flagship product, the Green Deal, remains untouched, as do improvements in healthcare. Most importantly, with this deal, Biden has achieved that he is now at peace until the end of his first term. Budget discussions for next fall have already begun. The next debate on the debt ceiling may cause financial markets to worry again in two years at the earliest.

In short: Biden achieved probably the most important victory of his tenure with an alleged defeat. Okay, the left wing is unhappy, but Biden has enough political capital in the bank with the progressives that they will forgive him. For moderate Democrats and independent voters, on the other hand, the president is the calming influence.

Biden was also able to pull in this number because he knew his opponent McCarthy could never have allowed a state bankruptcy either. With his supposed defeat – the agreement to negotiate – he has thus left him a way out. McCarthy had to go this route and will probably soon have a lot of trouble with the “crazy” in his faction.

The president, on the other hand, has a very different problem: he must remain modest in triumph – and must not celebrate his victory too openly.