From The New York Times:
What does this mean? First, it means that House Republicans have lost their favored fallback plan. If President Obama wants to go over the fiscal cliff — and every indication is that he does — then he’ll have his opportunity to do so, and Republicans are certain to take the blame, at least in the short run, which might be long enough to result in punishment in the 2014 midterms.
Second, though, it means we are going to get a true test of whether Obama wants to go over the cliff. After all, he is the president. It’s a big gamble to do this, betting on the political upside against guaranteed economic harm. If the economy takes a dive from here, it’s on his head in the long term. Even if people blame Republicans for now, and even if it costs them in 2014, it might give Obama some pause that his presidency could end up being written into the history books as an eight-year depression.
Another thing: What we’re seeing here is the result of the double-edged sword that is the earmark ban. The resulting decentralization of power in the House means that House Republicans don’t work for party leaders any more — for better or for worse. The days of Tom DeLay telling Republican members how they are going to vote are long gone. Without the power he needs to bully and boss people around by withholding earmarks, Boehner is working from a limited playbook.
This could mean that Republicans are doomed to a worse deal than the one that was just pulled from the floor. Alternatively, it could mean that Boehner wins precisely because he is so weak, based on Obama’s fears for what the cliff could do to his presidency.