WASHINGTON (MarketWatch) — The tea party’s tactics of shutting down the government and threatening a default may seem irrational to some people, but their threats have been so successful at forcing Democrats to cave on government spending that the tea party would have to be crazy to stop now.

If the Democrats always blink first, why not try it again and again?

The only problem with that strategy is that the tea party appears confused about what it wants out of this confrontation. It certainly doesn’t seem to have anything to do with the deficit or with the level of government spending.

Most Republicans probably don’t realize the extent to which they’ve already won on the deficit. In fact, government discretionary spending levels have been reduced so much that Republicans in the House now think they’re too low.

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House Republicans haven’t passed some of the appropriations bills this year because they couldn’t agree on the specific cuts to specific programs that would be required to squeeze the appropriations under the spending caps. They all love cuts in the abstract, but get cold feet when it actually comes to specifics, says Harry Stein of the left-leaning think tank Center for American Progress.

By using drastic tactics of threatening shutdowns and defaults, the tea party has shifted the terms of the debate on spending so much that the budget approved this year by the Senate Democrats (with no Republican support) actually calls for lower spending in 2014 than the “draconian” Republican budget proposed by Rep. Paul Ryan just two years ago.

Ryan’s 2012 budget plan called for discretionary spending of about $1.062 trillion (inflation-adjusted dollars) for fiscal 2014, while the Senate Democrats’ budget resolution calls for spending of $1.058 trillion.

And the continuing resolution approved last week by the Senate Democrats (with no Republican support) calls for spending of $986 billion, 18% lower than the funding level assumed in Obama’s 2010 budget submission.

As a share of GDP, discretionary spending has fallen below pre-crisis levels. Center for American Progress/Office of Management and Budget

Not so coincidentally, the House continuing resolution also calls for discretionary spending of $986 billion. In other words, the Democrats have fully agreed to the Republicans’ demands on government spending, even though the resulting fiscal drag has hobbled the recovery, costing millions of jobs.

But rather than declare victory, the tea party keeps moving the goal posts.

The tea party had a lot of leverage when it was demanding budget cuts. The deficits were huge, and even President Barack Obama agreed that the government needed to tighten its belt. When the disagreement is over budgets, compromise is possible. When it comes to numbers, you can often split the difference. But now the tea party has moved on to new battles. In the current shutdown, the point of contention isn’t the budget at all.

Instead, the fight is now over principles, not numbers. In this case, the principle is whether the government should help provide affordable health insurance to all. Compromise over principles is difficult: You’re for or you’re against.

By rejecting the Republicans’ demand that Obamacare be destroyed or curtailed, Obama and the Senate Democrats revealed that they place a higher value on the ransom (Obamacare) than on the hostage (keeping the government open).

And Obama and the Democrats seem to have learned the lesson that many blackmail victims eventually learn: If you pay once, you’ll probably have to keep paying forever. Negotiating only encourages them.

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That’s why the Democrats won’t give up Obamacare even if the Republicans threaten to default on the nation’s debt by refusing to raise the debt ceiling. If Democrats negotiated now, the Republicans could create a new debt-ceiling crisis once a year, twice a year, or even once a week if they wanted. It would permanently hand over control of the government to a minority.

It may be dawning on the tea party that it won’t get anything out of this showdown. Obama won’t give up Obamacare, nor will he agree to any other concession to settle the impasse over the debt ceiling. If the government defaulted, the economy could fall into a recession much worse than the one we just crawled out of, but that would be preferable to allowing a small minority dictate to the majority.

(Anyway, we strongly suspect that Obama won’t let the government default — that he’d pay the bills and the bonds as they come due by declaring that the debt-ceiling law violates other statutes requiring the president to spend the money appropriated by Congress, or that the debt ceiling even violates the Constitution. If the House disagrees, it could impeach Obama, but the Senate would never convict.)

As the shutdown drags on, the tea partiers have essentially dropped their demand to destroy Obamacare. They know they won’t get that. But what do they want? One Republican, Rep. Marlin Stutzman of Indiana, said that Republicans “have to get something out of this, and I don’t know what that even is.”

The tea party has achieved more than anyone could have expected, given its small numbers in Congress and its fringe standing among voters. It’s had its way on discretionary spending, but it won’t be able to force the president or the Senate to dismantle the great entitlements: Social Security, Medicare and Obamacare.

“We’re not going to be disrespected,” Rep. Stutzman said.

So that’s what this standoff has come down to. The tea party demands respect. It just wants a hug.