Liberal Leverage, Adieu
With both health insurance reform and economic recovery, two current parallel narratives center on leverage. In the aftermath and unraveling of the financial crisis, “leverage” was a buzzword that euphemized investment gambling. Now, the term is pertinent again with regard to negotiating capacity.
Now, leverage refers most clearly to the frustrating and intransigent senator from Connecticut without a political home, Joe Lieberman. Though he may (currently) reside right-of-center in the political spectrum, Lieberman’s position as a potential 60th Democratic vote puts him at the potent center of the health insurance debate. It’s the type of leveraging position that allows him to seemingly agree with compromises forged by the Gang of Ten, and then change his mind by the weekend. It’s the type of leveraging position that allows Lieberman to hold sway even after a video, in which he is shown to express seemingly contradictory beliefs, surfaces.
The term is also relevant to President Obama’s in-person (and phone) meeting with “fat-cat bankers.” With Bank of America, Citigroup, and Bank of New York Mellon recently lining up to pay back TARP money, much has been made of the administration’s sudden lack of leverage. Pay czar Kenneth Feinberg now holds a limited purview, and it seems that Obama can do little to change bank lending practices besides admonish.
Though banks are still supported by various beneficial Treasury and Federal Reserve policies, the overall health of many is also still in question, thereby hampering much threatening posturing that could influence banks. As a result, behavioral leverage, which was largely ceded with the original TARP bailout, is diminishing even further.
Other agendas put forth by the Obama Administration (tenuous AfPak allies come to mind) could also be threaded within this leverage storyline. For all the right’s rhetoric chastising the Obama Administration’s alleged unchecked government expansionism, it seems the White House is suddenly holding relatively few negotiating trump cards.
~Ben
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