The President’s missed opportunities for deficit reduction

The President’s missed opportunities for deficit reduction

In today’s press briefing White House Press Secretary Jay Carney discussed the Administration’s efforts to encourage Europe to address their ongoing debt crisis:

As you know, Matt, with the President and Tim Geithner — Secretary of Treasury — and others have been very engaged with their European counterparts on this issue, offering advice because we have a certain amount of experience in dealing with this kind of crisis.  And we urge them to move forward rapidly.

In the same briefing Mr. Carney discussed the President’s role in the Super Committee:

The President, at the beginning of the process, at the beginning of the super committee process, a committee established by an act of Congress, put forward a comprehensive proposal that went well beyond the $1.2 trillion mandated by that act and was a balanced approach to deficit reduction and getting our long-term debt under control.

Mr. Carney then turned to the failure of the Super Committee:

This committee was established by an act of Congress.  It was comprised of members of Congress.  Instead of pointing fingers and playing the blame game, Congress should act, fulfill its responsibility.  As for the sequester, it was designed, again, in this act of Congress, voted on by members of both parties and signed into law by this President, specifically to be onerous, to hold Congress’s feet to the fire.  It was designed so that it never came to pass, because Congress, understanding the consequences of failure, understanding the consequences of inaction, the consequences of being unwilling to take a balanced approach, were so dire.

Now, let me just say that Congress still has it within its capacity to be responsible and act.  As you noted, the sequester doesn’t take effect for a year.  Congress could still act and has plenty of time to act.  And we call on Congress to fulfill its responsibility.

… What Congress needs to do here has been and remains very clear.  They need to do their job.  They need to fulfill the responsibilities that they set for themselves.

The President’s press secretary tells us that the President and his Treasury Secretary have “been very engaged with their European counterparts” in addressing their debt crises, but it appears the President’s involvement in the American Super Committee was to set a proposal on the table and then leave.

Mr. Carney points to the President’s September proposal to the Super Committee, and to the negotiations with Speaker Boehner over the summer, as evidence that the President is trying to reduce the budget deficit.  For balance I think it’s important to point out five deficit reduction opportunities the President missed.

  1. Democratic majorities (2009-2010):  For the first two years of his term, the President had partisan super majorities in the House and Senate.  There was neither a Presidential proposal to reduce the deficit, nor any legislative action on deficit reduction.  The Administration argued that deficit reduction would be inconsistent with the short-term need for macro fiscal stimulus, even if that deficit reduction were to start several years down the road.
  2. Bowles-Simpson (Fall 2010 – Feb 2011):  The President could have taken the bipartisan Bowles-Simpson recommendations from the commission he created and proposed them in his budget.  Instead he shelved those recommendations.
  3. Blasting Paul Ryan and the Ryan budget (Spring 2011):  After House Republicans proposed $4 T of deficit reduction, the President offered a new budget that he claimed would match this deficit reduction, but which fell more than $1 T short and which relied on unspecified tax increases for the bulk of its claimed deficit reduction.  More importantly, in rolling out his proposal the President personally blasted House Budget Committee Chairman Paul Ryan and the Ryan budget, framing his new deficit reduction proposal as part of an aggressive political attack on Congressional Republicans.
  4. Backtracking in the Grand Bargain negotiations (Summer 2011):  When the Gang of Six offered their proposal in the middle of the Obama-Boehner negotiations, the President increased his demand for tax increases by $400 B over what he had previously proposed.  How could Speaker Boehner then sell his Republican Members on a deal that was worse than the President’s previous offer?  This Presidential step backward caused the Grand Bargain negotiations to collapse.
  5. Phoning it in to the Super Committee (Fall 2011):  The President was literally phoning it in (from Hawaii) to the Super Committee.  His advisors were nowhere to be found in or near any of the SC negotiations.  As best I can tell, only two of the six Super Committee Democrats (Senators Baucus and Kerry) were actively involved in negotiating with the six SC Republicans, and those two had no political cover from the President.  Today, after the Committee’s failure was formally acknowledged, we can see the President’s press secretary doing everything possible to distance the President from this failure and blame Congress for it.

Might the Super Committee have succeeded had the President been “very engaged” with Congressional negotiators, as Mr. Carney says he is with European leaders?  I don’t know, but I am a bit surprised that Mr. Carney is so quick to emphasize the President’s active involvement in addressing Europe’s fiscal problems, while not even pretending to care about a related American effort.

Mr. Carney says that “Congress needs to do their job.  They need to fulfill the responsibilities that they set for themselves.”

Q:  In a politically balanced Congress, is significant deficit reduction possible without Presidential leadership or even involvement?

(photo credit: The White House)

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