When Obamatons Respond
Op-Ed Columnist
By David Brooks
Published: March 5, 2009
On Tuesday, I wrote that the Obama budget is a liberal, big government document that should make moderates nervous. The column generated a large positive response from moderate Obama supporters who are anxious about where the administration is headed. It was not so popular inside the White House. Within a day, I had conversations with four senior members of the administration and in the interest of fairness, I thought I’d share their arguments with you today.
In the first place, they do not see themselves as a group of liberal crusaders. They see themselves as pragmatists who inherited a government and an economy that have been thrown out of whack. They’re not engaged in an ideological project to overturn the Reagan Revolution, a fight that was over long ago. They’re trying to restore balance: nurture an economy so that productivity gains are shared by the middle class and correct the irresponsible habits that developed during the Bush era.
The budget, they continue, isn’t some grand transformation of America. It raises taxes on energy and offsets them with tax cuts for the middle class. It raises taxes on the rich to a level slightly above where they were in the Clinton years and then uses the money as a down payment on health care reform. That’s what the budget does. It’s not the Russian Revolution.
Second, they argue, the Obama administration will not usher in an era of big government. Federal spending over the last generation has been about 20 percent of G.D.P. This year, it has surged to about 27 percent. But they aim to bring spending down to 22 percent of G.D.P. in a few years. And most of the increase, they insist, is caused by the aging of the population and the rise of mandatory entitlement spending. It’s not caused by big increases in the welfare state.
The White House has produced a chart showing nondefense discretionary spending as a share of G.D.P. That’s spending for education, welfare and all the stuff that Democrats love. Since 1985, this spending has hovered around 3.7 percent of G.D.P. This year, it’s about 4.6 percent. The White House claims that it is going to reduce this spending to 3.1 percent by 2019, lower than at any time in any recent Republican administration. I was invited to hang this chart on my wall and judge them by how well they meet these targets. (I have.)
Third, they say, Republicans should welcome the budget’s health care ideas. The Medicare reform represents a big cut in entitlement spending. It amounts to means-testing the system. It introduces more competition and cuts corporate welfare. These are all Republican ideas.
Over the long run, Obama has insisted that health care reform will be deficit-neutral. Many experts believe this will force Democrats to reduce the tax exemption for employee insurance benefits in order to raise revenue. This idea is at the core of most conservative reform proposals.
Fourth, the White House claims the budget will not produce a sea of red ink. Deficits are now at a gargantuan 12 percent of G.D.P., but the White House aims to bring this down to 3.5 percent in 2012. Besides, the long-range debt is what matters, and on this subject President Obama is hawkish.
He is extremely committed to entitlement reform and is plotting politically feasible ways to reduce Social Security as well as health spending. The White House folks didn’t say this, but I got the impression they’d be willing to raise taxes on the bottom 95 percent of earners as part of an overall package.
Fifth, the Obama folks feel they spend as much time resisting liberal ideas as enacting them. The president resisted union pressure and capped pay increases for government workers. He resisted efforts to create mandatory veterans’ health benefits. The administration plans to tackle the suspiciously large increase in the number of people claiming disability benefits.
I didn’t finish these conversations feeling chastened exactly. The fact is, after years of economic growth, the White House still projects perpetual deficits of more than $500 billion a year. That’s way too much, especially with the boomers’ retirements looming. Moreover, Congress will likely pass the spending parts of the budget and kill the revenue parts, like the cap-and-trade energy tax and the limits on itemized deductions, thus producing much, much bigger deficits.
Plus, I’m still convinced the administration is trying to do too much too fast and that the hasty planning and execution of these complex policies will lead to untold problems down the road.
Nonetheless, the White House made a case that was sophisticated and fact-based. These people know how to lead a discussion and set a tone of friendly cooperation. I’m more optimistic that if Senate moderates can get their act together and come up with their own proactive plan, they can help shape a budget that allays their anxieties while meeting the president’s goals.
Source: The New York Times
Op-Ed Columnist
By David Brooks
Published: March 5, 2009
On Tuesday, I wrote that the Obama budget is a liberal, big government document that should make moderates nervous. The column generated a large positive response from moderate Obama supporters who are anxious about where the administration is headed. It was not so popular inside the White House. Within a day, I had conversations with four senior members of the administration and in the interest of fairness, I thought I’d share their arguments with you today.
In the first place, they do not see themselves as a group of liberal crusaders. They see themselves as pragmatists who inherited a government and an economy that have been thrown out of whack. They’re not engaged in an ideological project to overturn the Reagan Revolution, a fight that was over long ago. They’re trying to restore balance: nurture an economy so that productivity gains are shared by the middle class and correct the irresponsible habits that developed during the Bush era.
The budget, they continue, isn’t some grand transformation of America. It raises taxes on energy and offsets them with tax cuts for the middle class. It raises taxes on the rich to a level slightly above where they were in the Clinton years and then uses the money as a down payment on health care reform. That’s what the budget does. It’s not the Russian Revolution.
Second, they argue, the Obama administration will not usher in an era of big government. Federal spending over the last generation has been about 20 percent of G.D.P. This year, it has surged to about 27 percent. But they aim to bring spending down to 22 percent of G.D.P. in a few years. And most of the increase, they insist, is caused by the aging of the population and the rise of mandatory entitlement spending. It’s not caused by big increases in the welfare state.
The White House has produced a chart showing nondefense discretionary spending as a share of G.D.P. That’s spending for education, welfare and all the stuff that Democrats love. Since 1985, this spending has hovered around 3.7 percent of G.D.P. This year, it’s about 4.6 percent. The White House claims that it is going to reduce this spending to 3.1 percent by 2019, lower than at any time in any recent Republican administration. I was invited to hang this chart on my wall and judge them by how well they meet these targets. (I have.)
Third, they say, Republicans should welcome the budget’s health care ideas. The Medicare reform represents a big cut in entitlement spending. It amounts to means-testing the system. It introduces more competition and cuts corporate welfare. These are all Republican ideas.
Over the long run, Obama has insisted that health care reform will be deficit-neutral. Many experts believe this will force Democrats to reduce the tax exemption for employee insurance benefits in order to raise revenue. This idea is at the core of most conservative reform proposals.
Fourth, the White House claims the budget will not produce a sea of red ink. Deficits are now at a gargantuan 12 percent of G.D.P., but the White House aims to bring this down to 3.5 percent in 2012. Besides, the long-range debt is what matters, and on this subject President Obama is hawkish.
He is extremely committed to entitlement reform and is plotting politically feasible ways to reduce Social Security as well as health spending. The White House folks didn’t say this, but I got the impression they’d be willing to raise taxes on the bottom 95 percent of earners as part of an overall package.
Fifth, the Obama folks feel they spend as much time resisting liberal ideas as enacting them. The president resisted union pressure and capped pay increases for government workers. He resisted efforts to create mandatory veterans’ health benefits. The administration plans to tackle the suspiciously large increase in the number of people claiming disability benefits.
I didn’t finish these conversations feeling chastened exactly. The fact is, after years of economic growth, the White House still projects perpetual deficits of more than $500 billion a year. That’s way too much, especially with the boomers’ retirements looming. Moreover, Congress will likely pass the spending parts of the budget and kill the revenue parts, like the cap-and-trade energy tax and the limits on itemized deductions, thus producing much, much bigger deficits.
Plus, I’m still convinced the administration is trying to do too much too fast and that the hasty planning and execution of these complex policies will lead to untold problems down the road.
Nonetheless, the White House made a case that was sophisticated and fact-based. These people know how to lead a discussion and set a tone of friendly cooperation. I’m more optimistic that if Senate moderates can get their act together and come up with their own proactive plan, they can help shape a budget that allays their anxieties while meeting the president’s goals.
Source: The New York Times
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