I never considered B. Hoover Obama to be any kind of seriously committed progressive, with his connections to big finance and reverence for St Ronnie of Senility. What I didn't realize is that he isn't simply a luke-warm liberal. He's a paleoconservative. In a world that made sense, where the Rethugs weren't bat-shit crazy, he'd actually be a Republican - probably a damned good one, since he's smart. Could it be that he isn't giving in as much as he's gravitating to the positions he actually believes in – not the ones we want him to believe in.
It’s hard to escape the impression that Republicans have taken Mr. Obama’s measure — that they’re calling his bluff in the belief that he can be counted on to fold. And it’s also hard to escape the impression that they’re right.
The real question is what Mr. Obama and his inner circle are thinking. Do they really believe, after all this time, that gestures of appeasement to the G.O.P. will elicit a good-faith response?
What’s even more puzzling is the apparent indifference of the Obama team to the effect of such gestures on their supporters. One would have expected a candidate who rode the enthusiasm of activists to an upset victory in the Democratic primary to realize that this enthusiasm was an important asset. Instead, however, Mr. Obama almost seems as if he’s trying, systematically, to disappoint his once-fervent supporters, to convince the people who put him where he is that they made an embarrassing mistake.
Whatever is going on inside the White House, from the outside it looks like moral collapse — a complete failure of purpose and loss of direction.
So what are Democrats to do? The answer, increasingly, seems to be that they’ll have to strike out on their own. In particular, Democrats in Congress still have the ability to put their opponents on the spot — as they did on Thursday when they forced a vote on extending middle-class tax cuts, putting Republicans in the awkward position of voting against the middle class to safeguard tax cuts for the rich.
It would be much easier, of course, for Democrats to draw a line if Mr. Obama would do his part. But all indications are that the party will have to look elsewhere for the leadership it needs.
Read Krugman's entire Op-ed for context and the economic background.
Meanwhile, we're screwed.