Brinksmanship strategies and the US debt ceiling

Speaking of brinksmanship, the passage of a bill to raise the US debt ceiling with no strings attached makes much more sense when viewed through a strategic lens. The standard view is that partisanship has rendered Washington dysfunctional, that the differences between Republican and Democratic positions are so extreme that no agreements are possible, and the leaders of the Tea Party movement are simply irresponsible. Commentators holding this standard view tended to predict another bruising battle over the debt ceiling this month. They were wrong. Consider an alternate possibility: Tea Party legislators saw in the debt ceiling bills an opportunity to gain more leverage than they could hope to achieve by electoral means. When they said, “defaulting on debt would not be so bad,” they were not revealing their foolishness, but rather, seeking to make a credible threat. There is no point in engaging in a brinksmanship strategy unless one is willing to make a credible threat. There is no point in saying “we will force a default on the US debt unless you gut your healthcare law – but do not worry, we do not actually intend to default on the debt.” The power of brinksmanship comes from the perceived willingness to do the unthinkable. What appears to be madness in Washington then becomes, seen through this lens, a clever ploy. And then consider what happened in October from this perspective. The House Republicans said “we are going to default” and the markets did not move. Hence their brinkmanship strategy was exposed as lacking credibility. As a result, they had no leverage. And indeed, as one would expect,...