Editorial -- Barack Obama Needs to Detail What 'Sacrifices' Look Like

Wednesday, November 26, 2008

"TO MAKE the investments we need," President-elect Barack Obama said Monday, "we'll have to scour our federal budget, line by line, and make meaningful cuts and sacrifices, as well, something I'll be discussing further tomorrow." When yesterday arrived, however, Mr. Obama wasn't much more specific. On one level, that's understandable; it will be difficult enough for the new administration to come up with a detailed budget by the time that is due in February. Yet Mr. Obama is talking about adding hundreds of billions of dollars in federal debt. That is reasonable under the dire economic circumstances, but it is scarcely adequate to couple that with platitudes about eliminating wasteful spending. As Mr. Obama well knows, and as his first-rate new budget director, Peter R. Orszag, understands as keenly as anyone, it will take far more than that to get the nation's fiscal house in order.

Mr. Obama spoke of meaningful cuts, but the example he cited yesterday -- crop subsidy overpayments to millionaire farmers not entitled to receive them -- was especially galling. The supposed amount involved -- $49 million over four years -- is puny in the context of a $3 trillion annual budget. Even worse, Mr. Obama, after inveighing on the campaign trail about "multimillion-dollar subsidies" for "agribusiness lobbyists," then supported a farm bill stuffed with just such subsidies. "With so much at stake, we cannot make the perfect the enemy of the good," Mr. Obama said of that measure, which also included significant increases in food stamp spending. Fine, but that does not augur well for President Obama's willingness to stand up to such subsidies, or his ability to convince his former congressional colleagues to "shed the spending that we don't need."

Mr. Obama was on firmer ground when he talked about focusing on "one of the biggest long-run challenges that our budget faces, namely the rising cost of health care in both the public and private sectors." Getting health-care costs under control as a key to reining in entitlement spending has been a particular interest of Mr. Orszag's during his tenure as director of the Congressional Budget Office. He has particularly stressed the importance of developing information about the comparative effectiveness of various medical treatments and reforming Medicare payments accordingly.

Yet here, too, Mr. Obama engaged in a bit of happy talk, skating lightly over the difficult choices that controlling health-care costs will entail. Investing in electronic medical records may be a wise use of federal money, but the returns on that alone will be inadequate for the task. Figuring out which treatments provide the most bang for the buck is important, but that approach will only restrain spending if payments are adjusted accordingly. That won't be popular, with physicians, drug companies or patients. And slowing the growth of health-care costs alone won't be enough to deal with the fiscal ramifications of the baby boomers' retirement. Yesterday may not have been the moment for Mr. Obama to lay all this out, but at some point he is going to have to stop talking vaguely about the need for "sacrifice" and be more candid about what that will entail.

© 2008 The Washington Post Company