In a primetime address to the nation Monday, President Barack Obama reiterated his demands that any long-term solution to the looming debt crisis include what he termed sacrifices shared “by those who can best afford it.”
Moving seamlessly between talk of “millionaires and billionaires” and those Americans “making more than $250,000 a year,” Obama tried to pin the blame for failing to pass the debt ceiling squarely at the feet of congressional conservatives.
“(A) significant number of Republicans in Congress are insisting on a cuts-only approach,” Obama said, “an approach that doesn’t ask the wealthiest Americans or biggest corporations to contribute anything at all. And because nothing is asked of those at the top of the income scales, such an approach would close the deficit only with more severe cuts to programs we all care about — cuts that place a greater burden on working families.”
Obama talked of the debt crisis as one in which everyone agrees about the need for tough choices, arguing that it was merely “about how it should be done.”
“Most Americans,“ he said, “don’t understand how we can ask a senior citizen to pay more for her Medicare before we ask corporate jet owners and oil companies to give up tax breaks that other companies don’t get. How can we ask a student to pay more for college before we ask hedge fund managers to stop paying taxes at a lower rate than their secretaries? How can we slash funding for education and clean energy before we ask people like me to give up tax breaks we don’t need and didn’t ask for?”
These are false choices, ones that ignore the real problem: that government continues to be too big and spend too much.
In his speech, Obama quoted Ronald Reagan who, at one time in his presidency, signed off on a deal known as “TEFRA” that was supposed to cut the deficit through the closing of tax loopholes and the introduction of tougher enforcement of tax rules. And, at its center, was a promise of $3 in spending cuts for every $1 in new revenue.
Sound familiar? Well, as most everyone who warned Reagan against the deal predicted, the revenues increases came about straight away while the spending cuts mysteriously never seemed to materialize.
In his response to the president, House Speaker John Boehner characterized Obama’s approach to the negotiations thus far as wanting to continue what he called “business as usual” in the nation’s capital.
“The sad truth is that the president wanted a blank check six months ago,” Boehner said, “and he wants a blank check today.”
Warning “’that is just not going to happen,” Boehner reinforced Congress’ support for Cut, Cap and Balance — the only plan to yet be brought up for a vote in either chamber, let alone pass in one of them.
“It cuts and caps government spending and paves the way for a Balanced Budget Amendment to the Constitution,” Boehner said, “which we believe is the best way to stop Washington from spending money it doesn’t have. Before we even passed the bill in the House, the president said he would veto it.”
So much for the talk of bipartisanship and compromise that was the theme of Obama’s speech.
Late Monday new plans were introduced by both Republicans in the House and Democrats in the Senate, both of which call for spending cuts at some point without any revenue enhancements or tax increases. Contrary to what the president said in his remarks, both parties in Congress seem to have recognized that, rhetorically at least, the “cuts only” approach is all the American people want to hear about. They understand what Obama does not — the problem is spending, not a lack of revenue.
There remains hope that the crisis can be averted. As Boehner said, “There is no stalemate in Congress,” something Obama charged more than once. “The House has passed a bill to raise the debt limit with bipartisan support. And this week, while the Senate is struggling to pass a bill filled with phony accounting and Washington gimmicks, we will pass another bill — one that was developed with the support of the bipartisan leadership of the U.S. Senate,” the Ohio Republican said.
The one part of Boehner’s plan that is sure to produce concern among his congressional allies — some of whom were quick to denounce it shortly after it was announced — is what the speaker called “a serious, bipartisan committee of the Congress will begin the hard but necessary work of dealing with the tough challenges our nation faces.”
Already being referred to as “the tax hike commission” by its critics, it is an issue Boehner will have to resolve before the plan can pass the House with a majority of GOP votes. U.S. Rep. Jim Jordan of Ohio, who chairs the influential House Republican Study Committee, said Tuesday in a statement that he could not support the new Boehner plan.
“The credit rating agencies have been clear that no matter what happens with the debt limit, the U.S. will lose its AAA credit rating unless we produce a credible plan to reduce the debt by trillions of dollars,” Jordan said, arguing that “Cut, Cap, and Balance is the only plan on the table that meets this standard” and that “[o]nly a Balanced Budget Amendment will actually solve our debt problems.”
Through out much of his speech Obama was shameless in his pitch for new revenues to be used for new programs, warning that without a deal on the debt “we won’t have enough money to make job-creating investments in things like education and infrastructure.” Indeed, he was even cavalier in the way he talked about the current crisis, as though his mismanagement of the U.S. economy had little if anything to do with it.
“For the last decade, we have spent more money than we take in,” he said. The budget surplus the nation once enjoyed as a result of the hard work and discipline of the Gingrich Congress was, Obama said, “spent on trillions of dollars in new tax cuts, while two wars and an expensive prescription drug program were simply added to our nation’s credit card.”
The financial crisis in place when he took office, Obama said, only made it worse. “The recession meant that there was less money coming in, and it required us to spend even more.” While factually correct, this is bad economic policy, policy that Obama should accept the blame for just as much as he tried to claim credit for it when he and his administration were pretending their efforts to fix the economy were working.