Commentary Magazine


Topic: federal budget

Must GOP Bow to Obama’s Fiscal Demands?

With the president’s election victory still fresh in their minds, Democrats are assuming that Tuesday’s results mean that Congressional Republicans are bound to bow to their demands for tax increases. Such sentiments are understandable given the Democrats’ clear victory in the presidential contest as well as their gains in Congress. Having campaigned on a platform of raising taxes on the wealthy, there may be little reason to assume President Obama is going to back down on his demands and, as many liberals have already pointed out, he’s going to be bitterly criticized if he does compromise on his soak-the-rich approach. Yet though Republicans may still be shell shocked by the election returns, there is no reason for them to cave in on their principles just because the president and his media cheering section expect them to.

House Speaker John Boehner sounded an appropriate note, albeit one that was pure political boilerplate, when he said yesterday, “Mr. President, this is your moment. We’re ready to be led — not as Democrats or Republicans, but as Americans. We want you to lead, not as a liberal or a conservative, but as president of the United States of America.” But his airy rhetoric contains a kernel of truth. If the country is to avoid going over the fiscal cliff in the next month, and avoid the terrible consequences that would result from a failure to reach a budget deal, it is going to require the kind of presidential leadership and ability to compromise that Obama has never been willing to provide in his first four years in office. The question before the country is not so much the one that liberals have been asking about Republicans simply waving the white flag as it is whether the president can actually bargain in good faith and get a deal.

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With the president’s election victory still fresh in their minds, Democrats are assuming that Tuesday’s results mean that Congressional Republicans are bound to bow to their demands for tax increases. Such sentiments are understandable given the Democrats’ clear victory in the presidential contest as well as their gains in Congress. Having campaigned on a platform of raising taxes on the wealthy, there may be little reason to assume President Obama is going to back down on his demands and, as many liberals have already pointed out, he’s going to be bitterly criticized if he does compromise on his soak-the-rich approach. Yet though Republicans may still be shell shocked by the election returns, there is no reason for them to cave in on their principles just because the president and his media cheering section expect them to.

House Speaker John Boehner sounded an appropriate note, albeit one that was pure political boilerplate, when he said yesterday, “Mr. President, this is your moment. We’re ready to be led — not as Democrats or Republicans, but as Americans. We want you to lead, not as a liberal or a conservative, but as president of the United States of America.” But his airy rhetoric contains a kernel of truth. If the country is to avoid going over the fiscal cliff in the next month, and avoid the terrible consequences that would result from a failure to reach a budget deal, it is going to require the kind of presidential leadership and ability to compromise that Obama has never been willing to provide in his first four years in office. The question before the country is not so much the one that liberals have been asking about Republicans simply waving the white flag as it is whether the president can actually bargain in good faith and get a deal.

Ever since last year’s debt ceiling crisis that set in motion the events that could lead to an automatic tax increase and sequestration of funds that would require massive across-the-board budget cuts for vital services and national defense, both the president and his antagonists have acted as if they had nothing to lose by going to the brink. In particular, the president’s strategy has seemed to revolve around an effort to drive the GOP leaders in the House away from a deal so as to be able to use their refusal to bow to his dictates as a political talking point. Obama’s model was the 1995 government shutdown in which President Clinton managed to outmaneuver then House Speaker Newt Gingrich into a corner and make him take the blame for the problem.

Boehner and Majority Leader Eric Cantor managed to avoid being fitted for the Gingrich clown suits but no deal was ever struck that they — or their caucus — could live with. But most observers seem to think that after the president’s re-election they have no choice but to give in on the extension of the Bush tax cuts. Congress’s reputation is in tatters and it stands to reason that the GOP would prefer to avoid not only the catastrophic cuts and taxes that a failure to make a deal would entail but the blame for the economic distress that would ensue.

However, the House Republicans aren’t the only ones feeling some pressure.

Most Democrats may be strutting this week and engaging in triumphalist rhetoric about their ability to dominate the country’s politics for the foreseeable future. But the president understands that a budget standoff could trigger an economic downturn that could cripple the start of his second term and set in motion a train of events that will make the next four years a nightmare for the country and for him. Though Republicans don’t want to be the scapegoats for a budget meltdown, the president needs a deal far more than they do.

But in order to get one, the president is going to have to eschew the sort of high-handed approach to Congress that has been the pattern for his first term. While that worked politically for him, it also served to give Boehner less room to negotiate since the president infuriated the GOP caucus and helped make it easier for them to dig in their heels and oppose a compromise. If the president wants Boehner to give him a deal, that will mean sitting down and asking for more revenue in ways that the GOP can live with–such as closing loopholes and deductions, but not confiscatory tax policies that will cripple economic growth.

For two years, President Obama has refused to take this deal, since it was in his political interest to portray Boehner and the GOP Congress as extremists. But though his supporters don’t seem to realize it, his political interests now lie in a policy that requires him to avoid the class warfare rhetoric and tactics designed to demonize Republicans he has employed in past negotiations.

The president needs to negotiate and take the deal Boehner is offering him with modifications that will allow him to save face. Doing so is good for the country and for his prospects for a second term that isn’t as awful as those of most of his predecessors.

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Is This the Ryan Teachable Moment?

Liberals are catching their breath after spending the first few days after Mitt Romney’s announcement of his vice presidential choice huffing and puffing about how happy they are to have Paul Ryan to attack this fall. But amid the complacent over-confidence, some are claiming to welcome the opportunity to have a debate about debt and the budget that Ryan’s presence on a national ticket will ensure. On the New York Times’ op-ed page, Joe Nocera attempts to broach the discussion in a serious manner while on the paper’s website, the less serious Roger Cohen also writes that such a debate would be good. Both seem to assume that most Americans share their prejudices about Ryan’s “radical” ideas about shrinking government but understand that the instinctive liberal refusal to contemplate a limit to federal spending is bad for the country’s long-term security.

This shows that despite their glib self-assurance that Americans can be Mediscared out of listening to Ryan’s ideas about reforming the government, some on the left are beginning to understand that Democrats must come up with an answer to the challenge posed by the intellectual leader of the GOP. Read Virginia Postrel’s suggestion yesterday in Bloomberg that the Republicans place Ryan front and center in a series of infomercials about the fiscal crisis this fall. The model would be the half hour prime time commercials that were broadcast by Ross Perot’s campaign in 1992 in which the eccentric and wealthy independent galvanized public attention on the budget with hand-held charts and lectures. While this idea may give heart attacks to some of Mitt Romney’s media consultants, it has some merit. For all of the arguments we’ve heard lately about the public’s willingness to listen to serious budget proposals like the one promoted by the GOP veep, the Republicans ought not to ignore the possibility that giving Ryan the opportunity to present his ideas is the last thing President Obama should want.

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Liberals are catching their breath after spending the first few days after Mitt Romney’s announcement of his vice presidential choice huffing and puffing about how happy they are to have Paul Ryan to attack this fall. But amid the complacent over-confidence, some are claiming to welcome the opportunity to have a debate about debt and the budget that Ryan’s presence on a national ticket will ensure. On the New York Times’ op-ed page, Joe Nocera attempts to broach the discussion in a serious manner while on the paper’s website, the less serious Roger Cohen also writes that such a debate would be good. Both seem to assume that most Americans share their prejudices about Ryan’s “radical” ideas about shrinking government but understand that the instinctive liberal refusal to contemplate a limit to federal spending is bad for the country’s long-term security.

This shows that despite their glib self-assurance that Americans can be Mediscared out of listening to Ryan’s ideas about reforming the government, some on the left are beginning to understand that Democrats must come up with an answer to the challenge posed by the intellectual leader of the GOP. Read Virginia Postrel’s suggestion yesterday in Bloomberg that the Republicans place Ryan front and center in a series of infomercials about the fiscal crisis this fall. The model would be the half hour prime time commercials that were broadcast by Ross Perot’s campaign in 1992 in which the eccentric and wealthy independent galvanized public attention on the budget with hand-held charts and lectures. While this idea may give heart attacks to some of Mitt Romney’s media consultants, it has some merit. For all of the arguments we’ve heard lately about the public’s willingness to listen to serious budget proposals like the one promoted by the GOP veep, the Republicans ought not to ignore the possibility that giving Ryan the opportunity to present his ideas is the last thing President Obama should want.

Liberals have been telling themselves the more Americans learn about what Ryan believes, the less likely they will be to vote for Romney. They believe, as Cohen says, that Ryan is the most radical Republican leader since Barry Goldwater and are sure that this guarantees a victory for the Democrats. But the genius of Ryan’s appeal is that he combines Ronald Reagan’s down home geniality with the sort of wonkish command of economics we have rarely seen in a national candidate. Rather than hoping Republicans will feature Ryan and his proposals, Democrats should fear the exposure he will get. The more people listen to Ryan’s notions about economic freedom and reining in the cycle of federal spending and taxing, the less likely they will be to accept the Democrats’ lame defense of the status quo.

There are good arguments against allowing Ryan to overshadow the top of the ticket. And, as Postrel admits, Ryan videos about the budget could provide Democrats with more material to attack. But as she rightly points out, the danger to the GOP isn’t that they would provide Obama’s campaign with ammunition, but that the attention span of the American people in 2012 is so much shorter than it was in 1992 that no one would listen to Ryan the way they did to Perot. But as she writes, no one expected the public to listen to Perot then either. The reason they did is there was a palpable hunger for new ideas and serious proposals about a problem most thinking people cared about. Ultimately, the voters rightly decided Perot wasn’t the sort of person who should be trusted with nuclear weapons, but his message resonated.

Republicans are capable of doing better than Perot’s primitive ads and they have a far better spokesman. It’s also possible to promote these ideas in a way in which the pecking order on the ticket is not reversed. Twenty years after Perot changed American politics, it may well be time for another lecture series on the budget and the size of the government that will ensure we have the serious debate about the fiscal crisis the country needs and deserves. Rather than a bonanza for the Democrats, the teachable moment for Paul Ryan’s ideas may have arrived.

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Another Debt Standoff? Let Voters Decide

House Speaker John Boehner is being blamed for setting the stage for a repeat of last summer’s debt ceiling crisis. In a speech, Boehner vowed that he wouldn’t go along with raising the amount of money the government can borrow to cover its debts unless Congress passed more spending cuts. An anguished chorus of Democrats predicting woe to the economy if another debt deadlock drama threatened the nation’s credit rating greeted this promise. The battle lines between the parties on the budget are still seemingly set in stone. Republicans, rightly in my view, don’t believe taxes that will harm an already sinking economy should be raised to allow the government to spend more money that it doesn’t have. Democrats prefer to play the class warfare card about taxing the rich but are still not prepared to contemplate the fundamental reform of entitlements that are drowning the nation in debt.

This means sooner or later there will be another Capitol Hill confrontation in which the two sides will seek to stand on their principles while demanding their opponents give up theirs for the sake of good government. If Treasury Secretary Timothy Geithner is to be believed, that next round won’t take place before the November election, because he said the government has the “tools” to keep the ship of state afloat until early next year. Let’s hope he’s right, because the answer to this stalemate won’t be found in the posturing of the parties or the somewhat disingenuous pious calls of President Obama for compromise. The only solution to this problem is to have an election.

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House Speaker John Boehner is being blamed for setting the stage for a repeat of last summer’s debt ceiling crisis. In a speech, Boehner vowed that he wouldn’t go along with raising the amount of money the government can borrow to cover its debts unless Congress passed more spending cuts. An anguished chorus of Democrats predicting woe to the economy if another debt deadlock drama threatened the nation’s credit rating greeted this promise. The battle lines between the parties on the budget are still seemingly set in stone. Republicans, rightly in my view, don’t believe taxes that will harm an already sinking economy should be raised to allow the government to spend more money that it doesn’t have. Democrats prefer to play the class warfare card about taxing the rich but are still not prepared to contemplate the fundamental reform of entitlements that are drowning the nation in debt.

This means sooner or later there will be another Capitol Hill confrontation in which the two sides will seek to stand on their principles while demanding their opponents give up theirs for the sake of good government. If Treasury Secretary Timothy Geithner is to be believed, that next round won’t take place before the November election, because he said the government has the “tools” to keep the ship of state afloat until early next year. Let’s hope he’s right, because the answer to this stalemate won’t be found in the posturing of the parties or the somewhat disingenuous pious calls of President Obama for compromise. The only solution to this problem is to have an election.

What’s wrong about much of the rhetoric used in the debt ceiling debate is the presumption that the two parties are not offering clear choices. Rather than spend another summer badgering each other to act in a manner contrary to the promises they made the voters, what the parties need to do is to simply go to the people and ask for a mandate. While such a standoff in a parliamentary system would result in the government’s fall and new elections, our Constitution requires that we wait until the next federal election for the same remedy.

The current situation is the result of having a House of Representatives that was produced by the Republican landslide in 2010 and a Senate with two-thirds of its members who were elected in the Democratic years of 2006 and 2008 when they also had one of their number elevated to the White House. What is needed this year is a clear answer from the electorate in which they choose a Congress and a president of the same party who can then put into effect the budget and spending plans they campaigned on.

It is possible that in November the voters will duplicate this unhappy situation by re-electing President Obama along with a Republican Congress. It is also possible, though less likely, that a President Romney will be faced with at least one chamber controlled by the Democrats. If that happens, then it will be time to talk compromise again, as it will not be possible for both sides to have their way.

But until that happens, it would be far better if we heard less talk in Washington about letting the “adults” set the agenda. That’s just another way of saying that we must continue with business as usual and put off making any decisions about reforming the system. While the DC establishment deprecates the efforts of some members and activists to put an end to the governing class merely dividing the spoils, calls for bipartisanship on the budget is merely a cover for avoiding fundamental change.

The two sides of the political aisle have competing visions about how we should operate the government. Romney laid down a marker on this issue yesterday with a speech in Iowa about the “prairie fire of debt” spreading through the nation while the president hasn’t let up with his calls for taxing the rich (even though that won’t do a thing to solve the budget tangle). Instead of pressuring those elected to stand up for one of those visions and betray the voters who sent them to Washington, it’s time to tell the voters to choose. That is the only and the best solution to any political deadlock.

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