Monday, August 08, 2011

That sick "Obama's sliding" feeling

Bitterly disappointed as I was in Obama for letting himself be hijacked in the debt ceiling deal, I have been willing to reserve judgment through the next round -- the supercommittee negotiations -- and possibly through the endgame of the Bush tax cut expirations.  But this from Obama today triggered that "there he goes again" reflex:
Last week, we reached an agreement that will make historic cuts to defense and domestic spending.  But there’s not much further we can cut in either of those categories.  What we need to do now is combine those spending cuts with two additional steps:  tax reform that will ask those who can afford it to pay their fair share and modest adjustments to health care programs like Medicare (my emphasis).

Couple that with this warning from Panetta:

Automatic spending cuts built into the debt-ceiling agreement are a "doomsday mechanism" that would damage national security if they kick in, Secretary of Defense Leon Panetta said Thursday.

The Defense Department is in line for budget cuts that will total about $350 billion over 10 years under terms of the deal signed into law Tuesday. But if lawmakers fail to agree on further savings, the agreement calls for an additional $1.2 trillion in automatic cuts, half from the Pentagon budget.

"It is an outcome that would be completely unacceptable to me as secretary of defense, to the president and I believe to our nation's leaders," Mr. Panetta said. "Most importantly, it would be unacceptable to the American people."
Are we to believe that the prospect of an additional $600 billion in scheduled reductions in defense spending from the current baseline will serve as more of a deterrent to the GOP than to the Obama administration? Yesterday's GOP, perhaps, but today's?

Look at Eric Cantor's memo to House Republicans, sent today.  The word "defense" does not appear at all. Instead, there's this:
Over the next several months, there will be tremendous pressure on Congress to prove that S&P’s analysis of the inability of the political parties to bridge our differences is wrong.  In short, there will be pressure to compromise on tax increases.  We will be told that there is no other way forward.  I respectfully disagree.

As we have said from the beginning of the year, the new Republican Majority was elected to change the way Washington does business.  We were not elected to raise taxes or take more money out of the pockets of hard working families and business people.   People understand Washington can’t keep spending money that it doesn’t have.   They want to see less government – not more taxes...

With the Budget Control Act, we made a $917 billion down payment on deficit reduction without raising taxes.   The Joint Committee created by the legislation presents another opportunity for an additional $1.2 to $1.5 trillion in savings by the end of the calendar year.  Based on the savings identified in our Budget Resolution and in the Biden Group, I firmly believe we can find bipartisan agreement on savings from mandatory programs that can be agreed to without tax increases.  I believe this is what we must demand from the Joint Committee as it begins its work.
While Cantor can't pretend that Obama has refused to entertain cuts to Medicare and Social Security -- that is, can't complain of an intransigence symmetric with the GOP's on taxes -- he does complain that
the President has repeatedly made clear that even if we agree to all of his requested tax increases, he would never support the type of structural changes to Medicaid, Medicare, and Social Security necessary to make these programs solvent as envisioned in our budget resolution.

More disturbingly, the President and Congressional Democrats have also argued that they will only consider modest changes to our current entitlement programs if we agree to tax increases.
In other words, we shouldn't feel pressured to deal on taxes unless the President agrees to voucherize Medicare, convert Medicaid to block grants and do God-knows-what to Social Security.

Meanwhile, instead of slamming the Republicans for vowing loudly and in chorus that their supercommittee members will never agree to tax reform that yields new revenue, Obama today served up more mush about "good ideas" from both sides and "a lack of political will in Washington":
There are plenty of good ideas about how to achieve long-term deficit reduction that doesn’t hamper economic growth right now.  Republicans and Democrats on the bipartisan fiscal commission that I set up put forth good proposals.  Republicans and Democrats in the Senate’s Gang of Six came up with some good proposals.  John Boehner and I came up with some good proposals when we came close to agreeing on a grand bargain.  

So it’s not a lack of plans or policies that’s the problem here.  It’s a lack of political will in Washington.  It’s the insistence on drawing lines in the sand, a refusal to put what’s best for the country ahead of self-interest or party or ideology.  And that’s what we need to change. 

I realize that after what we just went through, there’s some skepticism that Republicans and Democrats on the so-called super committee, this joint committee that’s been set up, will be able to reach a compromise, but my hope is that Friday’s news will give us a renewed sense of urgency.  I intend to present my own recommendations over the coming weeks on how we should proceed.  And that committee will have this administration’s full cooperation.  And I assure you, we will stay on it until we get the job done.
I was going to write today that, given the widespread disaffection in his base highlighted by the Drew Westen diatribe, Obama must know that he can't afford to blink if the supercommittee deadlocks and the automatic cuts loom as a real possibility.  I was going to note that while it was a terrible error to negotiate deficit reform under threat of the debt ceiling deadline, the perception that Obama always avoids conflict with the GOP or caves in negotiation may be something of a mirage, created by a) the limitations on execution of the progressive agenda in 2009-2010 imposed by the Senate's de facto 60-vote requirement, and b) per Jonathan Bernstein, Democrats' "delayed reaction to the severity of the Republican landslide of 2010."  In fact, I was thinking, Obama faced down Republican intransigence to win passage not only of the Affordable Care Act but also the New START treaty; and prior to the debt ceiling debacle he did not really do so badly negotiating the December tax cut deal, in which he won significant back-door stimulus, or the 2011 budget, in which there was apparently less to the headline $39 billion in cuts than met the eye.

But based on today's communications, I must ask: who looks more likely to cave in the supercommittee negotiations? And I don't like the answer.


  1. An NPR reporter who could read the teleprompter remarked yesterday that where the prez said " tax reform that will ask those who can afford it to pay their fair share" the script read (though crossed out) something like "corporations and the wealthy". He's less narratively challanged than his rhetoric lacks spine. No bully pulpit for him.

  2. "Are we to believe that the prospect of an additional $600 billion in scheduled reductions in defense spending from the current baseline will serve as more of a deterrent to the GOP than to the Obama administration? Yesterday's GOP, perhaps, but today's?"

    Well, that's the question, isn't it. Correct me if I am mistaken, but if new tax revenue is not on the table, and only additional cuts, oops, sorry, 'savings' are, then the GOP will have its way, the Dems will accede, the Pentagon will be spared and the military industrial complex can continue to spread democracy in the Middle East. Or am I just being cynical?

  3. Steve .. 'corporations and the wealthy' do not pay income tax due. The wealth pay taxes on their income, if any - not on their wealth - wealth is irrelevant. Corporations collect tax on behalf of the government from purchasers - it is purchasers of products and shareholders -- i.e. you and me - who pay corporate taxes, not some faceless alien entity.

    Bob in Portlandia