The One budgets WW II for 15 months....
The first two GOP budget plans passed the GOP House, but were then rejected in the Senate. The Washington Post reports that Reid's plan relies in part on rapidly cutting war costs in Iraq and Afghanistan:
Reid offered no further details about the plan. A Senate Democratic leadership aide, speaking on the condition of anonymity because the plan has not been publicly released, said the package would include cuts of up to $1.2 trillion over the next decade to government agencies, including the Pentagon. Democrats had previously offered to accept those savings, as well as about $200 billion in cuts to non-health direct-payment programs, such as farm subsidies.
The aide declined to say what else the package might contain. But people familiar with the months-long search for a debt-reduction compromise said that hitting such a large target without raising taxes or cutting entitlement programs would probably require Reid to rely heavily on savings from ending the wars in Iraq and Afghanistan — a figure budget analysts said could easily amount to more than $1 trillion over the next decade.
Politico sees Obama playing a risky "sidelines gamble" that is driven by his inexperience, poor personal relationships with GOP leaders and sheer distaste for legislative horse trading. (The latter is odd, given Obama's Illinois and US Senate legislative pedigree, but then again Obama never did anything in either post of significance.) The article says of GOP - Obama relations:
It’s a real roll of the dice: Even by Obama standards it’s dangerously late for him to be out of direct negotiations with a GOP opposition that doesn’t trust, like or respect him – and no one in the White House is quite sure how it will turn out....
“This is the responsibility of Congress,” [WH chief of Staff William] Daley added. “In the end, the Congress must pass this. It is their responsibility to extend the debt ceiling. So my sense is that in the end they will act.”
As Daley's statement suggests, it may even be that President Obama is comfortable with a default, because he thinks Republicans will be blamed. That may explain is insulting demeanor and words last Friday evening, which even ex-conservative David Brooks, a big Obama fan, found appalling (1:35). More evidence comes from Jennifer Rubin's Right Turn 8 AM Right Turn post (scroll down to see text):
A Republican aide e-mails me: “The Speaker, Sen. Reid and Sen. McConnell all agreed on the general framework of a two-part plan. A short-term increase (with cuts greater than the increase), combined with a committee to find long-term savings before the rest of the increase would be considered. Sen. Reid took the bipartisan plan to the White House and the President said no.”
Putting this together with Reid's plan above, to be unveiled today, we see that President Obama is willing to risk default. Reid's new plan targets war costs in lieu of tax reform, surely a non-starter for the GOP.
Jeffrey Anderson at The Weekly Standard calculates that adjusted for inflation Obama's $2.4 trillion added debt request to get past Election Day 2012 roughly equals our WW II total tab, which was $2.5 TR in 2011 dollars. Anderson adds that from 1961 through 1988, covering six Presidencies over 27 years, total added national debit in 2011 dollars was ... you guessed it, $2.4 TR. For further historical perspective (t/h Bill O'Reilly), President Clinton spent $547 million per day more than the Treasury took in, President G. W. Bush trebled that, to $1.6 billion daily and President Obama nearly trebled that, to $4.1 billion per day.
Consider one example of Obama's spending spree: the Department of Education. For FY 2010 its budget was $64.1 B; the estimated for FY 2012 is $77.4 B, a 21 percent increase in two years, while the economy was staggering & public debt skyrocketing with unprecedented speed.
The folly of this epic spendathon is sublimely captured in a "Spenditol" video ad (1:03, scroll down in link), t/h Jennifer Rubin's Right Turn. And, alas, a Balanced Budget Amendment cannot fix this, if only because judges get to interpret countless vexing questions, with entirely unpredictable results.
Jennifer Rubin posted a succinct summary of why the White House debt talks broke down Saturday eve. House Speaker John Boehner, tired of being repeatedly trashed by President Obama, went public. Definitely read her superb post on this.
Charles Krauthammer proposes a "half trillion plan" of delayed spending cuts to limp through the next few months servicing debt while a longer budget fix is negotiated. George Will urges passage of the McConnell plan, under which the President would have to make three debt-increase requests with each accompanied by matching spending cuts; GW believes it would lead to Obama's defeat in 2012. GW writes:
Obama vaguely promises to “look at” savings from entitlements because “we need to find trillions in savings over the next decade.” But when McConnell learned that negotiations chaired by Vice President Biden had identified a risible $2 billion in 2012 discretionary spending cuts — a sum equal to a rounding error on the GM bailout — McConnell concluded that Obama’s frugality pantomime required a response that will define the 2012 election choice.
Obama’s rhetorical floundering is the sound of a bewildered politician trying to be heard over the long, withdrawing roar of ebbing faith in a failing model of governance. From Greece to California, with manifestations in Italy, Spain, Portugal, Ireland, Illinois and elsewhere, this model is collapsing. Entangled economic and demographic forces are refuting the practice of ever-bigger government financed by an ever-smaller tax base and by imposing huge costs on voiceless future generations.
Richard Miniter, a Forbes columnist, is right: “Obama is not the new FDR, but the new Gorbachev.” Beneath the tattered, fading banner of reactionary liberalism, Obama struggles to sustain a doomed system. Democrats’ dependency agenda — swelling the ranks of government employees, multiplying government-subsidized industries, enveloping ever-more individuals in the entitlement culture — is buckling under an intractable contradiction: It is incompatible with economic growth sufficient to create enough wealth to feed the multiplying tax eaters.
Events are validating the Tea Partyers’ arguments. Time is on their side — but not on America’s, unless the impediment to reform is removed in 16 months.
Jennifer Rubin's Washington Post op-ed finds a petulant President overplaying his hand, allowing Speaker John Boehner to remove the action to Congress, where a debt-limit deal will pass, one the President cannot veto and politically survive:
In a remarkable press conference revealed that he had a deal with the White House on large debt reduction and $800 billion in additional revenue to be achieved through tax reform and enhanced enforcement. Boehner brought out his “Jell-O” analogy once again to describe the White House. He said bluntly, “It’s the president who walked away from his agreement and demanded more money at the last minute.”
Boehner is the composed “adult in the room” now. He, excuse the expression, called the president’s bluff — a viable deal with no tax hikes and Obama blinked (or sloshed in the other direction, to follow the Jell-O imagery).
All of this followed Obama’s appearance in which he angrily accused Boehner of walking away from the deal. (According to Boehner, Obama upped the revenue figure at the last moment.)
Boehner now has left the White House on the sidelines, has his troops in order and can craft a deal with the Senate....
One major irritant is the credit rating agencies threatening to downgrade Uncle Sam's rating without reforms acceptable to them. As a WSJ editorial notes, these agencies operate as a cartel, one whose flawed ratings were forced on financial firms by government pressure. The WSJ editors note that Dodd-Frank, in a rare good thing out of a monster mess of a law, aims at breaking up the cartel, allowing open competition in credit ratings. Meanwhile the agencies, one hopes, will put their amour propre on hold until the 2012 election results are in. If Obama is re-elected they will be justified in downgrading us; if a new administration gets in, it deserves a chance to craft a credible budget fix.
Offering a broader perspective that can inform future confrontations, politics maven Jay Cost offers four historical lessons--painful ones at that--for the GOP, as to these kinds of confrontations, drawn from prior episodes since WW II. First, elections rarely confer mandates; at best they offer a chance to build a mandate over time. The GOP has yet to solidify a mandate for its policies. Second, the "bully pulpit" is a powerful weapon for any President, even a weak one. (This is compounded when mainstream media acts as a multiplier on a President's side, and diminished when MSM opposes a President.) Third, policy nuance is lost in translation for most of the public; being right on details cannot trump bumper stickers. Fourth, a party needs to White House to change course, because of the power of the Presidential veto; Congress has only overridden 11 out of 2,564 Presidential vetoes in US history, a pitiful 4.4 percent.
Michael Barone explains why a GOP mandate awaits victory in 2012. He notes, though, that in the three off-year elections 1998, 2002 & 2006 the House vote percentage nationwide predicted the Presidential vote two years later. Ominously for Democrats, the House nationwide vote split 52-45 for the GOP in 2010, which Barone estimates would yield a 331 - 207 GOP Presidential electoral vote win.
Bottom Line. FDR went into war debt to save the free world (and the rest, as well) from the twin nightmares of German National Socialism & Japanese militarism. Barack Obama wants to go deeper into debt to ensure that Greatest of all Goals in the Tide of Times!!!!: his re-election.
Stay tuned.
Letter from the Capitol, LFTC, Economy, Conservative Politics
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