Friday, July 15, 2011

The President's phony posturing

Let us review a tiny bit of how President Obama's position on raising the debt ceiling has evolved. Originally, as April, he wanted a clean vote on raising the debt ceiling. That approach crashed when even the Democrats didn't want that. Then Vice President Biden worked on negotiating cuts in spending for around a $2 trillion debt ceiling increase. Then, when those talks broke down because of the insistence on tax increases, the President has decided that he wants to go big addressing all sorts of other issues like the tax code and entitlements reforms for a $4 trillion increase.

Of course, we don't really know what the President has been supporting because his proposals are made in closed-door meetings and aren't put into writing. That is why John Boehner compares the President's bargaining position to the single most repulsive food our cuisine contains, Jello.

But let us remember that Obama's pose of fiscal virtue is phony. It comes after the period of largest government spending since the Great Depression and World War II. And never forget that, until January of this year, the President and the Democrats had control of both the Legislative and Executive branches. If he was so enamored of any of this debt ceiling proposals, they could have passed it any time last year, even after the 2010 elections. But they wanted the Republicans to be involved to share the blame. They didn't want to own the debt ceiling increase even though they owned the spending.

Don't buy into the President's posturing. As the WSJ writes today,
The President is now claiming to have found fiscal virtue, but notice how hard he has fought House Republicans as they've sought to abate the spending boom. First he used the threat of a government shutdown to whittle the fiscal 2011 spending cuts down to very little. Then he invited Paul Ryan to sit in the front row for a speech while he called his House budget un-American.

Now Mr. Obama is using the debt-ceiling debate as a battering ram not to control spending but to command a tax increase. We're told the White House list of immediate budget savings, the ones that matter most because they are enforceable by the current Congress, are negligible. His offer for immediate domestic nondefense discretionary cuts: $2 billion.

As for Mr. Obama's proposed entitlement cuts, they are all nibbling around the edges of programs that are growing far faster than inflation. He's offering few reforms that would make a difference in the long run. Oh, and ObamaCare is untouchable, despite its $1 trillion in new spending over the next several years, growing even faster after that.

So now we have the inevitable showdown over the debt limit, which must be raised to pay for all of this spending. And Mr. Obama is blaming Republicans for being irresponsible because they won't raise taxes in return for promises of modest future spending restraint. And some people even fall for it.
The President even has gone on TV to lie about having to withhold sending out the August Social Security checks if the GOP doesn't send him a deal he likes. He compares himself to Ronald Reagan, but as Peggy Noonan reminds us, this is not how Reagan negotiated.
Majority Leader Eric Cantor reports Mr. Obama went into enough-is-enough mode during White House talks this week, warned Mr. Cantor not to call his bluff, and ended the meeting saying: "Can you imagine Ronald Reagan sitting here?" I'm glad Reagan is his model for how presidents should comport themselves, but he should know Reagan never tried to scare people into doing things his way. Instead he tried to encourage support, and with a light touch. When locked in battle with a Democratic Congress he didn't go on TV and make threats. He didn't say, "Congress needs to know we must rebuild our defense system, and if they don't, your children will die in a fiery hale of Soviet bullets."

That was—how to put it?—not his style. It's not any president's style. But it's what Mr. Obama was doing when he told CBS's Scott Pelley that he isn't sure there will be "money in the coffers" to send out Social Security checks. Soon he may be saying there won't be money in the coffers to let students return to college or to pay servicemen. The president is playing Targeted Catastrophe. He's attempting to agitate and frighten people into calling their congressmen and saying Don't Cut Anything, Raise Taxes on Millionaires.
However, the President doesn't even have the unanimous support of his own party. The WSJ quotes four Democratic senators on their opposition to tax increases. For those up in election next year, they're going to be very chary of voting for any tax increases. And three Democratic senators are opposed to an increase in taxes on the oil and gas industry. So he have trouble getting such increases through his own caucus in the Senate.

That is why it makes a lot of sense to dial back for a smaller deal such as Charles Krauthammer is proposing. Let us get past this deadline. Then take time to address some of the proposals out there on tax or entitlement reform. Don't rush those through like everything else in this presidency has been rushed through without time to consider the consequences. And use the 2012 election to debate these important questions.