As we begin the debate over whether to raise the debt ceiling, it's important to understand that the debt ceiling and the budget are two related but distinct things. It's not as though if the Republicans extract some concessions, we won't need to borrow anymore money and therefore we won't need to raise the debt ceiling. No one thinks the deficit will go below zero next year, or the year after, or for a couple of decades at least. The only reason we'll be talking about giving Republicans budget cuts in exchange for raising the debt ceiling is that it just happens to be a timely opportunity for them to take a hostage and extort some things they want.
Which should dictate Barack Obama's negotiating strategy. As Matt Yglesias argues, their position should be simple: nothing. This is essentially the Michael Corleone strategy. Matt explains:
After all, why should anything be given up[?] Everyone knows that increasing the debt ceiling is the right thing to do. If the government were operating under uniform Republican control, the GOP would be increasing the debt ceiling. There’s nothing to bargain over. If some members of congress genuinely think that no increase in the debt ceiling is a superior options to raising it, then they’re entitled to be wrong. But there’s no reason that Obama should be trading votes with guys like John Boehner who know perfectly well that an increase is in order. This frames the issue correctly as one of whether or not Republicans who think an increase is warranted will nonetheless refuse to allow one in order to extract unrelated concessions.
Matt goes on to explain how the initial weeks following the failure to pass the debt ceiling can be used to ramp up pressure on the GOP. Problem is, though the debt ceiling has nothing to do with the extra $50 billion in cuts or whatever Republicans will be demanding, most Americans won't make the distinction -- it's all budget stuff to them. And Obama has, unfortunately, already accepted the Republican proposition that cutting spending during a shaky recovery is a good idea, which makes it harder for him to take the Corleone line.