The Liberal Ironist has a suspicion that the next 10 days will determine both the electoral prospects and much of the legacy of the Obama Presidency. Between now and then the President and Congress must reach a deal to raise the current Federal debt limit of $14.3 trillion–technically exceeded in early May–or else the Federal Government will suddenly find itself unable to pay 56% of its budget authorization and even risk defaulting on interest payments on its current debt.
So the next 10 days are a critical test of President Obama’s political acuity–and of the viability of his Presidency. He absolutely must get the tone right as he tries to push Congressional Republicans towards a deficit-reduction deal, and he might already be in so much trouble that he has to secure a viable deal whether he frames the right message or not. These involve different theories of the political context and the media power of the Presidency: What is at question is whether the President, who is inevitably more-visible and more-resourced than any opposition Congressional leader, can use the bully pulpit to remind the public of the Federal programs he means to protect and why the Republicans must not be allowed to hold the Federal Government hostage, or whether, as recent polling suggests, the public is really so concerned with the Federal debt that they will embrace Republicans’ decision not to raise the debt limit. Finding such popular commitment to the principle of austerity implausible, the Liberal Ironist thinks the President should get on the soap box right now and push something very like a take-it-or-leave-it deficit reduction package to go with a debt limit increase.
It’s a telling sign of the rightward tilt Republican Party’s base that House Speaker John Boehner, having previously encouraged the President to think big (meaning a deal for a $4 trillion reduction in projected Federal deficits over 10 years), backed off of such an ambitious deal on Saturday, again citing the House Republican Caucus’s rigid rejection of any deficit-reduction plan that involves tax increases (even in the form of closing tax loopholes going to oil companies posting near-record profits or benefiting corporate jet-users). Boehner proposed, as an alternative, a return to the “Biden Group’s” plan for $2.4 trillion in debt reduction over 10 years. Vice President Joseph Biden began leading those talks with Republican and Democratic Congressional leaders in the spring after passage of the final F.Y. 2011 Federal Budget in April; they stalemated in June as House Majority Leader Eric Cantor walked out of the talks in protest of Democrats’ insistence that every $3 in spending cuts be matched with $1 of tax increases. This would have led to a projected Federal Government revenue increase of $600 billion over the next 10 years. (Incidentally, or perhaps not incidentally, canceling George W. Bush’s 2001 income tax cuts for Americans making over $200,000 a year would add about $700 billion in fresh revenues over the next 10 years.)
It doesn’t help President Obama’s re-election prospects that a long-term deficit reduction plan on the scale of the President’s Deficit Commission plan now appears to be an unreachable goal before 2013. While it’s true that Congressional Republicans have been dogmatic and stubborn in negotiations on deficit reduction, refusing to consider tax increases in the hundreds of billions of dollars over the next decade while the Democratic leaders have been offering spending cuts in the trillions over that time frame, President Obama deserves almost an equal share of the blame, strangely for the opposite reason. The President had the time and the political cover he needed to propose a deficit reduction plan of his own, and he didn’t take that opportunity.
Consider the scope of this failure: President Obama convened the bipartisan National Commission on Fiscal Responsibility and Reform by executive order in early 2010 (following Senate Republicans’ bizarre filibuster of Congressional authorization of such a commission). The Deficit Commission came out with a report, called “The Moment of Truth,” on December 1st. This report would have had to secured the yea votes of 14 out of 18 Commission members for legislation to be automatically drafted in Congress; only 11 of 18 members endorsed the report. The President still could have embraced the plan himself and called on Congress to draft legislation based on its recommendations. If he felt that the Commission’s proposals imposed program cuts that were too harsh and made recommendations that would leave us with a tax structure that is too regressive (as he did), he should have made a Liberal version of House Budget Committee Chairman Paul Ryan’s (R-WI) maneuver and synthesized much of the Deficit Commission’s report into a long-term plan for restructuring the Federal Government that reflected his ideology; instead he let Ryan advance his own long-term budget plan first, ensuring that any plan the President proposed afterwards would in fact simply be “the President’s response to the Paul Ryan Plan.”
There has been a growing trend this year of the President’s seeming inability to stay on-message. Since the President’s Middle East speech in which he called for a 2-state solution to the Israel-Palestine conflict negotiated from the 1967 borders, the President has failed to stake serious space for himself on any major issue, including the deficit-reduction negotiations. (The President’s call for tax increases on the rich to accompany any spending cuts and his refusal to sign a short-term debt increase doesn’t count, since it simply represents claimed parameters for negotiations he has only entered belatedly.) By around July 21, the President has to secure a deal on the debt limit increase or else there is a real possibility that the House Republican Caucus will overwhelmingly vote “Nay” on a debt limit increase even if the Speaker calls for it. If it comes to that, the President will have the unappetizing choice of boldly claiming that the 14th Amendment precludes statutory limits on Federal borrowing–which would inevitably be interpreted as a Presidential power grab–or stand abjectly in the face of an economically-disfiguring collapse of government resources. In any case, as I’ve already said, the President will at a minimum have to sound all the right notes in protest leading up to this historic collapse of political will, and at a maximum must secure a deal to keep the Federal Government operating through the end of his 1st term if he wants to keep his job. The Federal Government has never been brought down by failure to borrow money, and it has never defaulted on its debt; there is only a risk of either because of the ideological conformism of Congressional Republicans. In either the mildly-optimistic or the grim pictures of his prospects, the premise that the President is above the fray simply must be dropped. He doesn’t have to resort to simple partisan trench warfare, but he must learn to dictate terms.