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Right Turn
Posted at 09:00 AM ET, 04/11/2011

Obama’s do-over budget

President Obama introduced a budget that was widely panned. It didn’t touch entitlements, froze discretionary spending at inflated levels and threw in a $1.5 trillion tax hike. Then Rep. Paul Ryan (R-Wis.) rolled out his budget, which was widely praised. It addressed Medicare and Medicaid, froze discretionary spending at pre-Obama levels and proposed pro-growth tax reform. Following Obama’s shellacking by House Speaker John Boehner (R-Ohio), Obama is now going to try it again. His political adviser David Plouffe announced on the Sunday damage-control tour of four Sunday talk shows that the president would be rolling his long-term vision for addressing our debt problems (how appropriate that it was the political hack and not the OMB director, the Treasury secretary or any other serious economic adviser making the announcement). This is, not to mince words, pathetic.

As Bill Kristol put it on “Fox News Sunday,”Obama’s 2012 budget “had increases in spending, domestic discretionary spending, and no reform of entitlements. Now he’s going to have to reform his proposal this week, as David Plouffe said. That’s a very big moment for a president to do that, three, four months into his third year of the presidency. And he is now — Paul Ryan is leading and Barack Obama is following.”

Sounding more presidential every day, Ryan put out a written statement:

I’m encouraged to see House Republicans’ leadership advance a budget debate the American people deserve. The President, having already put forward an irresponsible budget, has failed to lead on fixing our fiscal problems. But if he does choose to follow with serious proposals that address the drivers of our debt and the anchors holding back our economy, the door is open.

The President and his party’s leaders will hopefully set aside the political rhetoric we’ve come to expect, and get serious about saving our health and retirement security programs. We need a clean break from the politics of the past. Leaders from both sides of the aisle will need to work together to put the budget on the path to balance and the economy on the path to prosperity.

The ranking member on the Senate Budget Committee, Sen. Jeff Sessions (R-Ala.), released a hard-hitting statement of his own:

The President recently submitted a budget to Congress that was the most irresponsible spending plan any President has ever put forward. Today’s announcement that the President will deliver an address this week on deficit reduction is an apparent recognition that the budget plan he submitted to Congress, as required by law, fails to address our dire fiscal challenges. However, it will not be sufficient for the President to simply make a speech. Instead, he must fulfill his duty as president and submit a new budget plan to Congress specifically setting forth the changes he wishes to make to his previous proposal, including both mandatory and discretionary savings. The President’s vision, whatever it is, must be presented in a detailed, concrete form. CBO must be able to score it and I and the Budget Committees in the House and Senate must be able to scrutinize it. I am uneasy that this announcement has been made not by a substantive policy official such as his budget director or Treasury Secretary but by the President’s top political advisor.

By law, three bodies in Washington must present a budget: the House, the Senate, and the White House. The Republican House proposed last week the most serious effort I have seen during my career to address our nation’s long-term fiscal challenges. I anxiously await an equally serious proposal from the Democrat Senate and White House. Another Washington-style tax-and-spend plan will not be acceptable.

In other words, Obama needs to show his hand and his math. It’s not clear which entitlement programs Obama will focus upon. Will he make Senate Majority Leader Harry Reid (D-Nev.) look ludicrous (well, more than usual) by going after Social Security? (If so, be on the lookout for a massive tax hike.) Will he promise to reform Medicare and Medicaid, more difficult to fix than Social Security? If so, it’ll be fascinating to see him try without mimicking Ryan’s approach.

As much as Republicans are rolling their eyes, Democrats should be very nervous. The president has lost control of the agenda. He’s now adopted the Republicans’ argument that our fiscal situation is precarious and must be addressed. And he’ll either have to put program cuts on the table that are an anathema to his base or decide to go into 2012 with even more tax hikes on the table.

Well, we know one thing for certain: Obama’s do-nothing strategy was a bust. Let’s see if reelection gambit 2.0 is any better.

By  |  09:00 AM ET, 04/11/2011

Categories:  Budget

 
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