Obama On Entitlement Reform: Patience!

As I listened to President Obama’s press conference this morning, which was dominated by budget issues, I thought of the recent criticism coming from the Right regarding Obama’s alleged unwillingness to address entitlement reform, typified by a comment by the GOP’s star quarterback on budget issues, Congressman Paul Ryan:

Presidents are elected to lead, not to punt. And this president has been punting.

Hmm. “Punting.”  Why do coaches punt?  Often in a game, when fans and quarterbacks are clamoring to “go for it,” wise coaches punt.  They do so in order to preserve field position, so as to have a better chance of scoring later.  And it is thinking about that “later”—the long-term—for which coaches get paid, not giving in to “the moment.”

As Obama said today:

I’m looking forward to having a conversation, but… the key here is for people to be practical not to score political points. That’s true for all of us.  I think if we take that approach we can navigate the situation in the short term and deal with the problem long term.

Now, that’s  wise coach-talk, no matter what quarterback Ryan says.

In the case of entitlement reform, President Obama said today that “this is going to be a process” and that we need to have patience—something the press doesn’t have, he suggested—much like a coach would tell his star quarterback, who almost never wants to punt on fourth down. 

But the point here is not that the President or his team wins a political game, but that real entitlement reform happens, both to preserve entitlements for future generations and to ensure that they remain safety nets for the most vulnerable among us.  That’s the touchdown in this scenario.

Here was his full response to NBC newsman Chuck Todd’s question about entitlement reform and the President’s debt commission:

Part of the challenge is here is that in this town let’s face it, you guys are pretty impatient…

I think there’s a tendency for us to assume that if it didn’t happen today it’s not going to happen. Well, the fiscal commission put out a framework. I agree with much of the framework, I disagree with some of the framework. It is true that it got 11 votes. That was a positive sign. When it is also true is that the chairman of the House Republican budgeteers did not sign off. He’s got … concerns. I will need to have a conversation with him, and with those Democrats that did not vote for it.

There are some issues in there, that as a matter of principle I do not agree with, where I think they did not go far enough or they went too far. So, this is going to be a process in which each side in both chambers of Congress go back and forth and start trying to whittle their differences down until we arrive said something that has an actual chance at passage. And that is my goal. My goal is to actually solve the problem. It is not to get a good headline on the first day. My goal is that a year from now, or two years from now, people look back and say we started making progress on this issue.

The key to achieving an agreement on how to reform entitlements is, as Mr. Obama put it, to make sure that both parties get “in the boat at the same time, so it doesn’t tip over.”  In other words, to prevent demagoguery by leaders in either party, nobody is going to go it alone.  

Obama’s latest budget, which he knows is not the final word on the subject, was an attempt to send a signal to everyone that he is serious about tackling deficit spending—”stabilizing the current situation,” as he put it—even though it dealt only with discretionary budget reductions. 

Today’s press conference was designed to send the message that he is willing to compromise on entitlement reform, as long as there is someone reasonable on the other side to deal with.  He thinks there will be, although he expects “all sides will have to do some posturing on television” before it’s all said and done.

Far from the hysteria surrounding our deficit and debt issues—many conservatives routinely refer to failure to radically cut spending as America “going off the cliff”—Obama’s demeanor and his conversation today was reassuring.  He was calm, sober, and free from the anxiety that characterizes much of the debate, particularly among those who want to use the debt problem as an excuse to kill government.  He was also confident about progress and its ancillary benefits:

In terms of the markets, I think what the markets want to see is progress. The markets understand that we’re not — we didn’t get here overnight and we’re not going to get out overnight. What they want to see is that we have the capacity to work together. If they see us chipping away at this problem in a serious way, even if we haven’t solved 100% of it all in one fell swoop, then that will provide more confidence that Washington can work.

And more than anything, that’s not just what the markets want, that’s what the American people. They just want some confirmation that this place can work. And I think it can.

The underlying message from Coach Obama is that it’s not necessary to panic.  Act like adults, get in the huddle together, and get the job done. 

Time will tell whether the President will give away too much in any possible compromise with seemingly unbending House Republicans, but I was encouraged by his statement that his deficit commission did recommend some things that he disagreed with on principle. And he reaffirmed today his opposition to tax cuts for the wealthy.  Although those tax cuts contribute to the deficit, more than that they symbolize the Republican duplicity on the deficit issue. Obama said,

… when it comes to, over the long-term, maintaining tax breaks for millionaires and billionaires, that will mean additional deficits of $1 trillion. If you’re serious about deficit reduction, you don’t do that.

Finally, the President essentially challenged Americans to have an “adult conversation” about national priorities, about “what’s important, and here’s how we’re going to pay for it.”  You want a strong military?  Veterans Benefits? Health care for seniors?  Want to help your neighbors during a natural disaster?  That stuff requires taxes. At one point he said,

If we’re cutting infant formula to poor kids, is that who we are as a people?

Ultimately, the answer to that question of identity rests with the American people. Those things do need to be discussed, and Mr. Obama and the Democrats need to keep reminding all of us that we will have the kind of government we are willing to pay for or else we will see a gradual decline—not a precipitous drop—in American fiscal and social well-being.

And for my money, President Obama is the leader in these times of choice, even though Republicans in Congress—and ultimately the people who sent them there—may very well choose decline over progress.

Unimaginable

Two years ago, who would have thought that the Huffington Post, a liberal-minded news source, would have headlined a story with this:

Here’s the opening paragraph:

WASHINGTON – President Barack Obama, less than two months after signing tax cuts for the wealthiest Americans into law, is proposing a budget to congress that attacks programs that assist the working poor, help the needy heat their homes, expand access to graduate-level education and undermine that type of community-based organizations that gave the president his start in Chicago.

And who would have thought two years ago that a Republican—Ron Paul—would appear on television and in the context of the budget call our Democratic president a “warmonger”?

All weekend I heard Jack Lew, Obama’s budget director, on the cable shows trying to explain why the President’s cuts were not only necessary, but courageous.  Well, okay.  But they certainly aren’t representative of the Democratic Party I used to know.  I’ve never heard of a Democrat arguing, for instance, that we should cut $100 billion from Pell Grant programs, have you?

Mr. Lew, who was President Clinton’s last budget director,  was on CNBC’s Squawk Box this morning, again defending the President’s budget, due to be released today.  He did make one good point:

I left this job ten years ago with a surplus of $5.6 trillion over the next ten years; I came back with deficits of $10 trillion over the next ten years. 

I suppose it’s bad manners these days to point out why Mr. Lew found things in such bad shape, or maybe it’s simply that everyone has forgiven the Bushies for their tax-cutting frenzy, since Mr. Obama seems to have partially embraced their strategy, too.

But I find it bad manners to talk about massive budget cuts—domestic discretionary spending, as Obama bragged this morning, will go back to Eisenhower levels—without talking about the enormous revenue short fall, brought on by a starve-the-government-beast philosophy. I never heard Mr. Obama mention that in his short budget speech this morning.

Such a philosophy used to be the property of the Republican Party, but it is increasingly being embraced, to some degree or another, by Democrats.

The federal government is spending about 25.3% of GDP.  But it is taxing the country at about 14.4% of GDP.  What’s wrong with that picture?  Why should all of the pressure be on the spending side, especially when Democrats—which is supposed to be a goverment-friendly party—control the White House and the Senate? 

To be fair, the budget projections in the President’s new budget do show that in ten years, revenues would be 20% of GDP, and spending will decrease to 23.1%.  But no one believes House Republicans will agree to raise revenues so responsibly.  There mission is to kill government, not fund it.

In any case, the President’s $3.73 trillion budget contains some $1.1 trillion in budget cuts over the next ten years, which according to The Wall Street Journal, amounts to about  a 14% reduction in the projected debt over that time.  About one-third of the savings would come from tax increases, including some on the wealthy, but not nearly enough to make up for the tax-cut deal Obama made with Republicans at the end of last year.

Besides the cuts noted at HuffPo, the budget does manage to offer up $78 billion in defense cuts, even as we are spending somewhere around $2 billion a week—that’s every week—in Afghanistan and another $ 1 billion a week in Iraq. 

On both issues—tax hikes for the wealthy and defense budget cuts—Obama would have the American people with him if he were to go farther.  A poll at the end of last year showed that 61% of Americans prefer tax increases for wealthy Americans as a “first step” toward tackling the deficit.  Next in line was cutting defense spending, at 20%. So, there is room to act responsibly on the revenue side, as well as the spending side.

Predictably, the Right says Obama’s budget doesn’t go far enough.  Speaker John Boehner said Obama’s budget “continues to destroy jobs by spending too much, borrows too much and taxes too much.”  He also falsely claimed, “We’re broke.”

Congressman Paul Ryan, budget guru for the fiscal-sky-is-falling Republican Party, said,

Presidents are elected to lead, not to punt. And this president has been punting.

Even  deficit hand-wringers on the Democratic side are chiming in with criticism, not of the President’s dramatic cuts, but of his failure to do more. Erskine Bowles, the Democratic co-chairman of Obama’s debt commission, said:

The budget goes nowhere near where they will have to go to resolve our fiscal nightmare.

Republican Joe Scarborough said this morning on his show that the whole thing was “depressing.”  He complained that the administration is “slashing like crazy” the relatively small discretionary part of the budget—about 15% of federal spending—while “they don’t the courage to go after the part of the budget that causes the debt crisis.”

By courage, of course, Scarborough means going first on offering cuts in Social Security, Medicare, and Medicaid.  But why would Obama want to do that?  Tea Party Republicans claim they were elected as serious budget cutters, pledging to change the game in Washington.  Why not let them offer up their “courageous” plan first?  So far, they have offered nothing on entitlements, hoping, I suppose, that Obama would take the bait and offer up something first. 

But I can still remember the last campaign in which many Republicans demagogued cuts in Medicare Advantage, which cuts were used as a partial funding instrument of the health care reform act. They tried to sell senior citizens on the idea that Democrats were jeopardizing Medicare.  So, this time, Republicans get to go first.

John Boehner did pledge that “it’s all coming,” speaking of the GOP’s long-term deficit-reduction strategy.  And when it gets here, Obama’s budget cutting, which doesn’t look all that good right now to many liberals, may suddenly look pretty good.  And the President may be able to take advantage of the division in the Republican ranks between the kill-government-at-all costs wing and those who just want to wound government so severely it will never walk again.

That is if he doesn’t cut another deal with them.

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