Saturday, November 14, 2009

Prove It
The White House announced yesterday that its focus for 2010 would turn to deficit reduction. Even beyond the political atmospherics--the hardening conventional wisdom that the Democrats are at grave risk of getting pounded next year because of the public perception that they've revived mindless liberal big-spenderism--there are good substantive reasons for this: it would be nice to approach China from a position other than cravenness informed by the ardent wish not to offend one's banker, and the long-term budgetary situation is legitimately scary. At the same time, as Andrew Sullivan points out, the imbecility of Politico's coverage (see the first link) itself contributes to the lameness of the debate around spending.

But Sullivan seems much more sanguine than I about the prospects of Obama actually establishing some fiscal discipline bona fides--and, much as I hate to credit the Politico given its painfully dumb framing, they've got some valid points on the substance:

[T]here is no evidence Democrats are willing to aggressively cut the biggest parts of the budget, such as entitlement programs and defense. Former President Bill Clinton told Senate Democrats at their policy lunch this week that one of the biggest reasons to finish health care is to allow Obama to focus on economic concerns next year – in part with more spending. Sen. Ron Wyden (D-Ore.) said afterward that Clinton had advised getting health care out of the way to “clear the tables and allow the focus to be on jobs and education and infrastructure.” None of that is free.

The Wall Street Journal reported Thursday the White House is considering applying some money from the $700 billion financial bailout bill to deficit reduction, and that Cabinet agencies have been asked to submit two budget plans for next year, one that freezes spending at existing levels and one that trims spending by 5 percent. Congress has long history of taking those requests and piling on money for programs it favors. The only way Obama can prevent Congress from imposing its will – a tactic he has been reluctant to do during his presidency – would be to threaten vetoes. And if Obama’s political goal is to minimize tough votes, gutting domestic spending bills could mean fewer projects lawmakers can brag about back home. History shows that that’s often an impossible sale on the Hill.

I remember that once for a college class--this was 1993 or 1994--we were asked to look at the federal budget and make cuts to bring it into balance. Reading the items of expenditure on a computer screen, I was shocked at how easy this actually was... in the abstract, without real-world political considerations. We're all aware that the defense budget includes billions of dollars on items that the military actively doesn't want, that billions more are poured into agricultural subsidies proven to have little to no value, that pork (some of which is defensible on its merits, and much of which is not) persists whichever party is in power, and so on. Medicare, some argue, spends billions more than is necessary (though who argues this seems to depend on the current power dynamic; when it's helpful in thwarting Obama, Republicans become passionately pro-waste in Medicare). All this spending is deeply institutionalized and very well defended politically--and as Politico notes, attacking any of it means incurring difficult and painful political conflict.

Everybody agrees that getting the budget under control is a long-term necessity. But nobody wants to see their pet expenditure sacrificed on the altar of fiscal responsibility, and in the context of one vote or one campaign the tangible thing lost--spending on a pointless weapons system that nonetheless employs hundreds of voters in a key congressional district, or on a subsidy to agribusiness interests that are major campaign contributors to midwestern Democrats--always will outweigh the theoretical gain.

To solve a problem this important and deeply rooted requires a systemic approach that transcends political norms--which in this case impel officials and candidates to pursue victory by blaming the other party rather than proposing inevitably painful solutions. Ideally, Obama will propose in his State of the Union speech (when this will be presented to the country) some kind of bipartisan, bicameral commission to make sweeping recommendations for cuts in the military budget, entitlements--the biggest long-term driver of our budget nightmare--and discretionary spending, which is the "easiest" area to cut (to the dismay of liberal-leaning domestic policy wonks like, um, me) but also the least impactful. The idea, which I guess is the reason Sullivan has some optimism, is that either the Republicans agree and participate in good faith, or they refuse and are rightly blamed for mindless obstructionism.

But I don't think it works that way. Our political culture is set up to emphasize conflict; the result is a style of coverage that effectively rewards mindless obstructionism. Add in that voters frustrated with what they perceive as excessive spending are likely operating in a closed or semi-closed information system anyway, to the point where their biased information sources (whether explicitly like Fox News, or implicitly like Politico) will reinforce their sense that since the Democrats have the power, they should do this unilaterally. That Republicans would rip them, and be effective in doing so, for "short-changing America's defense," "hurting seniors," or "crippling our global competitiveness" won't register.

Also, though it pains me to admit it as someone who was such a big fan of the guy only a year ago, I haven't seen many signs that Obama himself has the political courage to really take on these tough fights in his own party. Is he going to push for changes in entitlements to save them, even though seniors will vigorously resist? Can he withstand the political heat that any Democrat draws when s/he utters the mildest peep of protest against our absurdly bloated military spending and global posture of empire? Right after either barely winning or painfully losing a debilitating year-long fight to pass health care reform--and, if he does win, having to live with a piece of legislation that conservatives loathe and liberals are deeply disappointed with--I don't see him pushing as hard here as is needed. And why not? Deficits and debt represent a problem that always can be kicked down the road. Until it can't.

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