Budget ceiling talks are reflecting badly on Republicans

Republicans must acknowledge that the budget talks are crucial to their electoral chance in 2012. It's time to address these concerns.

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Par for the course? Talks are still at a stalemate...
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James Dwyer
On 16 July 2011 16:00

You might be forgiven for thinking that nothing else is happening except for the phone hacking scandal - and even that is growing international arms and legs.

There are however plenty of things going on worth paying more attention to, none more so than the ongoing debate about the state America's finances.

In short, the US is perilously close to running out of money. The Treasury predicts that America will run out of money on August 2nd. The thought alone of a country such as America running out of money is staggering.

Despite continuing talks between the Democrats and the Republicans, no deal has been made. The main impasse is around taxes, which is hardly a surprise. Things aren’t going anywhere fast and the two sides are not showing any particular desire to agree any time soon.

One important outcome of this political staring competition that is yet to fully be realised is the affect it will have on the two parties, both in the present and more pressingly, on the 2012 election campaign.

Whilst it might seem far-fetched to suggest that a budget crisis in the summer of 2011 could have an impact on an election in the winter of 2012, it is not. The economy is the one area of politics that sticks around more than anything else. So with all the current negotiating, the Republicans should be worried as there is a good chance it is they who will come off worse.

The reason is this: whilst within their own party the fight for the finer points of the budget is appreciated, to those outside the fold - and independent, undecided voters in particular - it looks as if the Republicans are simply fighting for the rich elite and not acting for the interest of the majority.

Barack Obama's comments that the GOP were more interested in private jets than the future for their children was batted away by Republicans, but it will not be dismissed so easily by Americans who work hard but see little financial reward for their labour in the current climate.

Some of this is down to unfortunate political posturing. It is the Democrats who get to host the budgets talks in the White House; it is the Republicans who have to arrive, go through security and leave at the end of negotiations.

The photos show Obama comfortable in his own office, whilst the Republicans are the visiting guests. The heavily staged golf game between the President and John Boehner was supposedly more of a level-playing field, but ultimately it is hard to come out on top when you're playing a round of golf with the President.

For those people who are politically inclined and who follow the budget deals, the picture is much more blurry. For the average Joe, this doesn't matter. It is perceptions that count.

So for as long as the negotiations go on, unless the Democrats make a monumentally stupid decision - which seems unlikely - the Republicans will look like the weaker, less competent side.

The candidates for the Republican 2012 nomination should be watching this carefully, as they will be involved in picking up the pieces. They will have to show that the GOP is best placed to handle America's fragile economy, that the GOP is intent on solving America's enormous debt crisis and financial concerns.

Mitt Romney and Jon Huntsman at the moment seem most likely to be able to get this message across, but it will be a big task.

The economy will dominate the 2012 election. There will be other issues and other hurdles to traverse, but it is the state of America’s finances that really counts. For the right, the best move would be to come out of these negotiations in the strongest possible state - compromises or not. A battering now would be a serious blow and would have ramifications that would almost certainly run to late 2012.

The Grand Old Party needs to think in the long-term and focus on 2012. These budget negotiations could have much more of an impact on the 2012 election than anyone - Republicans in particular - would care to admit.

James Dwyer works for PoliticsHome on the news team. He writes for The Commentator in a personal capacity.

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