Playing fiscal chicken

President Obama didn’t get all that he wanted in the budget legislation Congress approved on New Year’s Day, but he got most of it. The richest 2 percent will pay more in taxes, unemployment will be extended, milk prices won’t double, the alternative minimum tax won’t hit 30 million more people, and Medicare payments to doctors won’t be rolled back.

But he also gave ground on his original insistence that taxes be raised on income over $250,000, falling back to $400,000 for individuals and $450,000 for families.

The problem the president now faces is that on two upcoming votes—on the $110 billion in automatic spending cuts that Tuesday’s voting postponed for two months, and on raising the debt ceiling—he may have little left to trade.

The president says he will refuse to play fiscal chicken over the debt ceiling. “While I will negotiate over many things,” he said following the House vote Tuesday, “I will not have another debate with this Congress over whether or not they should pay the bills that they’ve already racked up through the laws that they passed.”

But he may not be able to avoid it, given Republicans’ intransigence, and the danger from U.S. default on its debt is infinitely greater than the phony, ginned-up threat posed by the so-called “fiscal cliff.” Let’s hope Obama stands his ground this time around.