MUCH OF WHAT President Obama hopes to accomplish in his second term would tap into what’s known as the “discretionary budget” — money not already claimed by entitlement programs such as Medicare and Social Security. But the discretionary budget itself is about tapped out, squeezed by the growth of entitlement spending. That’s what makes the minimal presidential leadership on entitlement reform so baffling.
This week Washington is having a stupid fight over a stupid budget issue. The so-called sequestration of $85 billion in federal spending would weaken the economy just as an increase in the payroll tax appears to be giving consumers pause. It would force the government to make mindless cuts across the board, instead of allowing reasoned choices. According to Mr. Obama’s senior military advisers, it would endanger national security. Yet nobody seems inclined to prevent it.
In the petty arguments over this self-inflicted wound, there are merits, or demerits, on both sides. The Republicans are right when they say that the sequester was Mr. Obama’s idea, in the summer of 2011, and that he agreed to a deal that was all spending cuts, no tax hikes. He is correct that he hoped the sequester would never go into effect but would be replaced by a 10-year bargain that would raise revenue and slow the growth of entitlement costs. He is correct, too, on the larger point: Such a deal is what’s needed, and the Republicans are wrong to resist further revenue hikes.
But if that’s what’s needed, why is Mr. Obama not leading the way to a solution? From the start, and increasingly in his second term, Mr. Obama has presented entitlement reform as something he would do grudgingly, as a favor to the opposition, when he should be explaining to the American people — and to his party — why it is an urgent national need. Obama priorities such as health and energy research, preschool education and job training: Those come from the discretionary budget.
Yet the $1.4 trillion in spending cuts that Mr. Obama and Congress have agreed to over the past two years all come from the discretionary side. By 2023, if you believe their promises, the government will be spending only 2.8 percent of gross domestic product on defense — compared to a 40-year average of 4.7 percent — and only 2.7 percent on everything else in the discretionary budget, compared to a 40-year average of 4.0 percent. Meanwhile, the three fastest-growing categories of spending will have become the largest categories of spending: Social Security, health care and interest on the swollen debt. Interest alone will have risen from $224 billion this year to an astonishing $857 billion 10 years from now, according to the nonpartisan Congressional Budget Office. What a pathetic waste of taxpayer money.
Most Republicans in Congress have been utterly irresponsible in this debate. They pretend that they could balance the budget without more revenue, an arithmetical impossibility, and they have failed to put forward realistic, near-term entitlement reforms. But we take little comfort in Mr. Obama’s being less irresponsible. He is the president; his party colleagues are increasingly intransigent on entitlement reform; and it will be his — and their — progressive goals that suffer most if the nation continues on its current path.