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Archive for Friday, July 22, 2011

President’s debt offer may be risky, but could be win-win

July 22, 2011

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— It’s hard to know which is more surprising: a Democratic president pushing historic cuts in spending, including Social Security and Medicare. Or a Republican-controlled House refusing to accept the deal and declare a huge victory for long-sought GOP goals.

Political orthodoxy has been turned on its head ever since President Barack Obama stepped up his call for a bipartisan “grand bargain” to raise the national debt ceiling and avert a default on U.S. obligations. The deal would include $4 trillion in deficit reduction over 10 years, mainly through steep spending cuts but also including up to $1 trillion in new federal revenue.

Those are far bigger targets than typical budget negotiations. And the spending cuts would seem more appropriate for a Republican president than a Democrat.

Some pundits and political insiders say Republicans should leap at the offer. But there’s a hitch: The new revenue — mainly from overhauling the tax code and lowering rates by eliminating or limiting a broad swath of loopholes, deductions and tax breaks — presumably would violate a no-net-tax-hike pledge that scores of Republican lawmakers have signed.

Mostly for that reason, House Republicans so far have rejected Obama’s overture, despite the interest shown by Speaker John Boehner. Some pro-Republican analysts seem bewildered.

Obama’s offer of big spending cuts would have “brutally fractured the Democratic Party,” and congressional Republicans probably “will come to regret this missed opportunity,” wrote David Brooks, a moderate-to-conservative columnist for The New York Times.

Such comments lead to a question: Why did Obama make the overture, and how might it affect him and his party as he ramps up his re-election campaign?

The consensus answer, based on interviews with key players in Congress, the White House and elsewhere, is that Obama may be maneuvering himself into a win-win political position for 2012, although it’s not without risks.

If Congress approves a version of the “grand bargain,” Obama can run next year as a president who began taming the runaway deficit, extracted concessions on higher taxes from Republicans and put Medicare and Social Security on a possible path toward greater stability.

If congressional Republicans block the plan — and especially if the Aug. 2 debt ceiling deadline is missed — Obama might persuasively argue that he tried his best to strike a compromise, at some political risk to himself. Recent polls suggest that strategy is working, as Americans seem disgruntled with the Republicans’ dug-in opposition.

Either way, Obama can appeal to the all-important independent voters next year, portraying himself as above the bitterly partisan House and Senate squabbles. Polls show that independents are deeply unhappy with Congress. Even if Obama’s ratings are not spectacular, he fares better.

A CBS-New York Times poll found that 68 percent of independents think an agreement on spending and the debt ceiling should include “a combination of both tax increases and spending cuts,” which is the president’s position. Fifty-five percent of Republicans in the survey hold that view.

Comments

Floyd Craig 2 years, 8 months ago

IMPEACH ALL THOSE WHO WANT THE POOR TO SUFFER THEY DONT HAVE ANY THING TO WORRY ABOUT THEY GOT LOTS OF MONEY THE BUMBS NEEDS TO BE FIRED

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just_another_bozo_on_this_bus 2 years, 9 months ago

Obama is doing the bidding of Wall Street, who want profits wherever they can find them, even if it means throwing grandma and grandpa out on the streets.

That's likewise who the Republicans are working for. So expect the poor to pay, because the rich say we're broke.

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cardoner 2 years, 9 months ago

Mr. Babington and Mr. Kuhnhenn would do well to read Mona Charen's most recent article (Find the link at www.drudgereport.com.) Citing David Brooks as your source from the right shows how weak your article is. You completely misrepresent Obama's failure to lead on this issue. To help combat your obvious pro-Obama spin, here are some facts: 1) Obama ignored his own deficit commission's findings last Dec. 2) He made only scant mention of deficit reduction in his SOTU speech in Jan. 3) His budget proposal in Feb-Mar would have added $10 trillion to the debt, had it been enacted into law. 4) This proposal was rejected by the Senate 97-0. 5) The GW speech you referred to was not a real legislative plan, included no actual specifics, and could not be scored by the CBO, meaning it was not worth the hot air Obama used to utter it. 6) In fact, the Pres. has yet to offer a concrete plan to the Congress or the people. Also, independent poll numbers for Congress have historically been much lower than for the Pres. Your claim that this will make a huge difference politically to a president with weak poll numbers is hardly convincing. You also failed to mention or report that Pres. will not even consider cuts to Obamacare, Education, Energy, and several other areas of federal spending. Sounds like intransigence to me. In support of your article, I'll say this much. The Pres. is trying to get the politics right because he's completely wrong on the policy and he knows it. In other words, he's acting like a partisan politician. What the country needs instead is leadership, not somebody more concerned with keeping his own job than enacting policies that promote jobs for others.

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meatandpotatoes 2 years, 9 months ago

As usual, Obama will end up the hero, ie, his darling media will spin it off that way. Won't mean a hill of beans when this Obama Depression continues to drag everyone down on into next year and who knows how much longer.

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