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Does the Senate need collateral?


It may just be because I'm tired today, but I think the problems of the shadow-banking sector are actually an interesting way to think about Lindsey Graham (pictured) and the Democrats. Consider again the way that the institutional banking market works: I give you something of great value to me (100 million dollars) and you give me something of equivalent value as a guarantee that you won't take my money.

Now consider the problems of bipartisan cooperation in the Senate: The minority wants something of great value from the majority (major policy concessions and an effective veto over the legislation moving forward) but there's no collateral for the majority: Members of the minority do not pledge their vote in advance, and there's no assurance that substantive policy concessions that make the bill less popular will lead to minority support.

If Lindsey Graham had collateral -- eight Republicans willing to assure the Democrats that they'd vote for a bill blessed by Graham -- he could write his own ticket. There's no way that Democrats would cross Graham in that circumstance. But as it is, Graham has no collateral. Not even himself. He's already said he won't be the lone Republican to vote for the bill. So there's nothing keeping the Democrats’ investment safe. If they take on this politically difficult issue in a politically unfriendly environment, they may give a lot up and get nothing back. So they're balking.

Graham is attacking them for that, but his implied collateral -- Republican support for the climate bill, even if it's just his vote -- is not something he is able or willing to promise the Democrats if they take the risk of banking with him. And you see this on every issue these days: Democrats are willing to negotiate, but they eventually break off because the lone Republican in the room -- be it Snowe or Corker or Graham -- is asking them to take too much risk with not enough collateral.

Photo credit: By Melina Mara/The Washington Post

By Ezra Klein  |  April 26, 2010; 4:22 PM ET
Categories:  Climate Change  
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plus, Graham always looks to me like he needs a haircut

Posted by: bdballard | April 26, 2010 4:27 PM | Report abuse

Anyone who thinks there is any chance any Republican (except maybe Crist) have even an ounce of good faith in them is too phreakin' re-tar-ded to live.

Posted by: AZProgressive | April 26, 2010 4:44 PM | Report abuse

Hey! Why don't--ALL--the illegal aliens, squatting in Arizona pack up their truck with all their family members and head for California. Los Angeles Mayor will give you food stamps, low income housing. There is a few emergency hospitals not closed down yet, where you can get treatment for free. The schools can build more outbuildings, so the already clogged classrooms can take all the children that don't comprehend English. They can get money expenses from the state and the old, the handicapped people in your family circle can collect SSI. Come to think of it, why don't we just put a welcome mat on both borders and one at airport terminal and let millions of pregnant females get instant citizenship for their new baby, collect the supplements to low income above. Then remember even though you haven't paid any taxes you can still cheat the IRS and collect thousands of dollars for your kid's under the Mothers name, then collect the same amount again for the same kid's under the Fathers name. Oh! Yes! Don't forget you can collect even more government checks for existing or non-existing kid in the country you left behind. Our IRS agents don't check. We have our share of common criminals amongst our citizens without importing more. No wonder this country is slipping into bankruptcy, because this government does not care for the people--they have sworn to protect. NumbersUSA will spill the truth, not lies from the open border lobbyists or the Liberal press.

Posted by: infinity555 | April 26, 2010 4:52 PM | Report abuse

The concessions without collateral was what got Democrats in trouble on the health care bill. The dropped provision after provision without getting a single Republican vote. They did what they had to do to get Lieberman, Lincoln, and Nelson on board, but anything else was wasted.

Given that experience, it should be no surprise that they're reluctant to bargain without some kind of assurance from someone across the aisle. It's perfectly reasonable to ask "What would it take to get you on this bill?" And if they don't get an answer, then there's no incentive for them to bring anything to the table. Otherwise, it just allows the other side to ask for concession after concession and keep moving the goalposts.

Votes are the currency of Congress. Without the strong assurance of a vote, there's no leverage to make a deal.

Posted by: dasimon | April 26, 2010 5:08 PM | Report abuse

Johnathan Chait wraps it all up today's post:

"The strategy here seems to be, take a political hit by opposing popular legislation, and then hope that somehow this will strengthen the party's hand in the negotiations to follow. How will this work? It's like trying to bluff your opponent in poker when both you and he know he has the stronger hand."

Posted by: RalfW | April 26, 2010 5:09 PM | Report abuse

"My word is my bond."
Currently the GOP promises are in the junk-bond category (or sub-sub-prime) and there ain't any 'collateral' there.

Oh, what a statement about the decline of Senatorial values.

Posted by: grooft | April 27, 2010 8:10 AM | Report abuse

This seems to be an overly complicated way of explaining that they know that Graham is a liar.

Posted by: Bloix | April 27, 2010 9:22 AM | Report abuse

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