Setting Defiant Tone In Fiscal Standoff, Obama Seems To Be Betting GOP Will Fold On Taxes

President Obama broke no new ground with his press conference today. And despite a conciliatory tone at times, he was ultimately resolute and even defiant.

He was unyielding in his economic posture and his willingness to compromise seemed rhetorical at best. He was focused more on tax cuts for the middle class than he was on resolving the overall fiscal challenges. To be fair, he did speak to the impending fiscal cliff, but there was no obvious willingness to compromise with the Republicans on tax rates via revenue. The President sounded just as he did on the campaign trail with slightly more conciliation in his tone, but only slightly.

Indeed, the movement of the stock market as the press conference was going on and after reflects the markets rational pessimism towards a president who appears not to recognize that in the absence of a compromise we could be heading towards fiscal Armageddon. The market closed down some 200 points having been down only 60 points before the President began – a clear reaction to his message.

And on Libya, the President was positively defiant, making it very clear that Susan Rice was speaking for the White House when she went on five Sunday morning programs to say that the attack on the Benghazi consulate was in response to a film rather than an act of terrorism. In the aftermath of the event, the President made it be known that if people wanted to take her on they were taking him and his administration on as well.

That seemed to be a prelude to Rice possibly being elevated to Secretary of State after Hillary Clinton’s departure. And indeed while making no commitments, the President offered a warm endorsement of Ambassador Rice.

The take home message from the President’s press conference is that he clearly believes the Republicans will ultimately fold on revenue and he may well be right. But his larger mission, trying to achieve some overarching agreement, seems more and more elusive and the President shows no inclination to compromise on fiscal matters in a way that would resolve our outstanding controversies with the debt, deficit and indeed the overall fiscal crisis we face.