July 25, 2011
Big Surprise, The President is Not Serious about Spending Cuts
Big surprise, the president is not serious about spending cuts, and wants to use the current debt crisis as an excuse to expand government and raise taxes.
You can balance the budget by increasing revenue to match spending, reduce spending to match revenue, or both so that they meet in the middle. The first is totally unacceptable, the second ideal, and the third misses the point.
The problem is twofold; One is the deficit and amount of debt we have built up. Second is the overall size and scope of government. Stated another way, balancing the budget at current levels of spending would only solve half of the problem.
But on with proving the thesis of the post:
Toying With Default
The President isn't serious about real spending cuts
The Wall Street Journal
Barack Obama was in full-scold mode Friday night, summoning Congressional leaders to the White House to "explain to me how it is that we are going to avoid default." It's a terrific question, albeit one the President refuses to answer. He remains far more interested in maneuvering to blame a default or credit downgrade on Republicans than in making himself part of any plausible solution to a crisis he insists is imminent.
Senate Minority Leader Mitch McConnell, who figured out earlier than most that the President wasn't serious, long ago turned to crafting a deal within Congress. He's now been joined by John Boehner, who was prepared to take political risks to reach for the "big deal" only to tire of White House antics. Now House Republicans and Senate Democrats are each working to craft their own plans, and it says something that the country has a better shot of getting something out of a divided Congress than it does out of the Oval Office.
Then again, it has long been clear that Mr. Obama isn't interested in spending reform. In February he proposed a budget that spent more than any in U.S. history. In April he demanded that Congress pass a "clean" debt ceiling hike that included no spending cuts whatsoever. Only after House Republicans unveiled their own sweeping budgetary reforms did the White House rush to also claim it wanted deficit reduction as part of the debt-ceiling debate.
In June, the President dispatched Joe Biden to negotiate spending cuts, only to have the White House insist at the last minute that modest trims be accompanied by significant new taxes. Mr. Boehner and the Senate's bipartisan Gang of Six produced plans that would have acceded to that White House demand in exchange for substantive tax reform that would have lowered individual and corporate rates. Yet last week the White House backtracked on its agreement for the lower tax rates and demanded another $400 billion in tax revenues above the $800 billion the Speaker had already conceded.
The President insists his party is offering serious spending cuts and entitlement reform. He also likes to talk about "balance," which to him means real tax increases immediately and speculative spending cuts some time in the distant future. Behind the scenes the White House has only ever agreed to token reform and cuts. Here's a number for the debt history books: Mr. Obama's final offer in the Biden talks was a $2 billion cut in 2012 nondefense discretionary spending. The federal government spends more than $10 billion a day.
Now we're days from the August 2 default deadline set by the Treasury Department, and the President's only response has been to blame everybody else for deficient seriousness.
Mr. Boehner reached out to Senate Majority Leader Harry Reid this weekend, only to have Democrats continue to insist any deal include a sweeping debt ceiling increase that provides the White House with political cover through the 2012 election. The Speaker's goal now should be to get his House members to design a package of cuts--no matter how small--that can pass both chambers, and pair this with a debt ceiling increase that avoids default. Even many Democrats agree with Republicans on a base of about $1 trillion in cuts over 10 years. Mr. Boehner would also be wise to make sure his bill doesn't include a mandatory balanced budget provision, or any other clause that the White House can label a poison pill.
Mr. Boehner can then toss this fix to the Senate and let Democrats decide if they want to trigger a default. If the bill falls short of President Obama's and Mr. Reid's demand for a big enough debt increase to push any further fights until after the election, then let the White House or Senate Democrats take responsibility for killing it on those political grounds.
This fall-back position is far less than many House Republican freshmen, particularly those in the tea party, were hoping to leverage out of this debt fight. It may not even be enough to avoid one or more of the ratings agencies from stripping the U.S. of its AAA rating.
But it is growing abundantly clear that this may be the best Republicans can do with a President who is using these negotiations to finance the blowout spending of his first two years with a tax increase. Voters can decide for themselves who was toying with default come the real moment of truth in November 2012.
Posted by Tom at July 25, 2011 8:20 PM
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Obama's prime time speech from the White House tonight proves your point. It provided no new ideas for resolving the debt crisis and was little more than the recycled hyper-partisan rhetoric and fingerpointing that have become his hallmarks.
Boehner's response was constructive and adult-like by comparison.
Posted by: Mike's America at July 25, 2011 10:05 PM