WASHINGTON — President Obama has finally decided to take his own side in the philosophical struggle that is the true engine of this nation’s budget debate.
After months of mixed signals about what he was willing to fight for, Obama finally laid out his purposes and his principles. His approach has difficulties of its own, and much will depend on execution. But the president was unequivocal in arguing that the roots of our fiscal problems lie in the tax cuts of the last decade that we could not afford. And he raised the stakes in our politics to something more fundamental than dry numbers on a page or computer screen.
“We are rugged individualists, a self-reliant people with a healthy skepticism of too much government,” he declared. “But there has always been another thread running throughout our history — a belief that we are all connected, and that there are some things we can only do together, as a nation. We believe, in the words of our first Republican president, Abraham Lincoln, that through government, we should do together what we cannot do as well for ourselves.”
Ryan’s reactionary plan
There are at least four things to like about his approach. First, without mentioning Rep. Paul Ryan by name, he called out Ryan’s truly reactionary budget proposal for what it is: an effort to slash government programs, in large part to preserve and expand tax cuts for the wealthy. “That’s not right,” he said, “and it’s not going to happen as long as I’m president.”
Second, he was willing to speak plainly about raising taxes, and he insisted correctly on restoring the Clinton-era tax rates for the wealthy. Tax reform, which he also proposed, is a fine idea, though there is ample reason for skepticism as to how much revenue it can produce. It would be far better to return to all of the Clinton tax rates and then build tax reform on that base, in particular through higher taxes on investment income.
Third, he was right to focus on the need to cut security spending. Any serious effort to reduce the deficit cannot exempt defense. It’s laughable for Republicans to criticize defense cuts and then be utterly unwilling to increase taxes to pay for the defense they claim we need.
Finally, he was eloquent in defending Medicare and Medicaid. He proposed saving money by building on last year’s heath reform law. There are two ways to reduce the government’s heath care expenses. One is Ryan’s path, which, Obama said, “lowers the government’s health care bills by asking seniors and poor families to pay them instead.” The alternative, which the president rightly embraced, “lowers the government’s health care bills by reducing the cost of health care itself.”
But a good speech is only a first step. For his allies, the president’s negotiating method has been, well, petrifying: concede, concede and concede again — and then compromise from an already heavily compromised position. That’s why his promised cuts in domestic spending straight out of the box are worrying.
This problem will be even worse if the Obama plan comes to be defined as the “left” pole in the negotiation. It’s not. A truly progressive budget would include more revenue raised in more progressive ways. And contrary to what you might hear on Fox News, the established media wisdom on budget issues is center-right, and Ryan’s extreme budget has pushed the perceived center still further right, aggravating the tendency to locate Obama’s plan far to the left of where it is.
More than deficit
And there is something fundamentally wrong about making the deficit the central issue in our politics. Here’s a little secret: The deficit is actually not a hard problem. Only the taxophobia that Republicans have created and Democrats cower before has made this so complicated. Yes, health care costs are also a big deal. But they are a challenge for the whole economy and too many conservatives demagogue all serious efforts to grapple with them (see “death panels”).
For all that, there was a bigness about Obama’s speech that was a relief after his recent sojourn as a sideline judge. “We believe that in order to preserve our own freedoms and pursue our own happiness, we can’t just think about ourselves,” he said. “We have to think about the country that made those liberties possible. We have to think about our fellow citizens with whom we share a community.” Obama is back on the field, and this is where he needs to stay.