I have three thoughts-
1. I would really love to see a debt deal, but if it's not possible, then I would not feel that the Republicans "lost" if we went with something short term. Obama does not want a deal at all. So there most likely won't be one. Obama's only hope in 2012 is to blame the economy on the Republicans because of a debt ceiling negotiation failure. It doesn't matter at all what is real or true, he'll say it and the media will pound it into our heads for the next 16 months. It's exactly like the WMD mantra of the Left after the second Iraq invasion. All of a sudden "Bush lied", never mind that there was a broad consensus before the invasion that Saddam had WMD and that we had to go in. They rewrote history and it worked for them. Compared to that whopper, selling the idea that the fiscal crisis is all because of Republicans is easy.
2. To me, the only way for the Republicans to come out of these negotiations with any chance not to be blamed for any possible subsequent financial problems is to make the negotiations public. For instance, pass a no-strings $200-300 billion cap increase in the House, then immediately pressure the Senate to PASS A BUDGET, and tie the debt ceiling to the budget. There are any number of ways to achieve this. Yes, public debate isn't conducive to making deals, but that's not what this is about. The Democrats don't want a deal. They want to be able to say that they proposed major entitlement cuts, but then behind closed doors do nothing like that. Let the American people understand where the parties really stand. By the way, this isn't just about appearances. I also think that if the process is more visible, then the public pressure for the Republicans will also be greater. Remember what happened during the town halls during the health care debate? It would be just as intense this time around.
3. I agree that a tax increase is not what this economy needs. But this really is a crisis, and the US really will be bankrupt if we don't raise some taxes, and in my opinion the argument against any and all tax hikes isn't a political winner, that's just life. Read this in the National Review Online, for instance. So instead, the Republicans should start talking about the RATIO between tax hikes and spending cuts, citing empirical data such as this. Even left-leaning economists generally agree that spending cuts are better than tax hikes. Read this, for instance.
Anyway, many of you won't agree with me on #3, and my heart is with you though my head has concerns. The main thought I want to share is that the Republicans need to make the process more transparent and public, it is the only way to overcome the Obama/MSM edge.