The GOP Will Benefit From the Budget Debate

April 13, 2011

President Obama's wild rhetorical gyrations have become familiar. Earlier this year, for example, he called budget cuts proposed by House Republicans "extreme," suggesting they hurt "our most vulnerable citizens." Yet after agreeing to many of them last Friday, he praised them as "worthwhile," "common sense," and evidence America is "beginning to live within our means."

In his speech at George Washington University yesterday, Mr. Obama repeated the mantra that "We have to live within our means, reduce our deficit, and get back on a path that will allow us to pay down our debt." But these words ring hollow coming from a president who has overseen a staggering increase in spending since coming to power. His most recent budget would nearly double the public debt in the next decade, according to the Congressional Budget Office (CBO).

Moreover, the goal Mr. Obama laid out yesterday—"a balanced approach to achieve $4 trillion in deficit reduction over 12 years"—was missing but one thing: a concrete blueprint to reaching it. That is what his budget, submitted in February, was supposed to do.

None of this should come as any surprise. Mr. Obama routinely describes a fiscal nirvana without telling Americans how he proposes to get there.

The Heritage Foundation's Brian Riedl points out Mr. Obama's fiscal 2012 budget conjured up $700 billion in defense savings "by comparing the long-planned drawdown of Iraq and Afghanistan spending against a baseline that implausibly assumes those [war] costs would continue forever." He also notes that the budget proposes $315 billion in savings from eliminating "certain tax expenditures," but does not list which ones.

The $131 billion in losses taxpayers have suffered so far in bailing out Fannie Mae and Freddie Mac are miraculously reduced by almost half over the next decade, and the net savings are added to the budget—without any explanation how this can be accomplished. And $328 billion is created from what the administration's budget calls "bipartisan financing for Transportation Trust Fund." The White House denies it's a gas tax increase, but refuses to say what it is.

According to the CBO, the administration overestimates revenues and underestimates spending in its budgets—and by a whole lot. These make a big difference. In March, the CBO reported the deficit over the next decade would be $2.3 trillion larger than Mr. Obama's budget forecast. A docile White House press corps largely ignored this rebuke of the administration.

Tricks make it possible for Mr. Obama to increase spending while claiming to be a budget cutter and deficit hawk. The optics are nice. The reality is awful.

It would have been reassuring if Mr. Obama had sent White House Chief of Staff Bill Daley or Office of Management and Budget Director Jack Lew to last Sunday morning's talk shows to say the administration is serious about deficit reduction and entitlement reform. Their presence could have signaled Mr. Obama was making a sincere attempt at bipartisanship.

Instead, he sent David Plouffe, who ran Mr. Obama's 2008 campaign and is in the White House to quarterback his 2012 re-election. Congressional Republicans were right to be unsettled, especially since Mr. Plouffe could not overcome his partisan instincts. He dismissed compromise, saying Mr. Obama "is not going to support a lot of" the GOP's budget plan, and intimated that on deficit reduction, Republicans wanted to shift "all the burden on seniors and poor people and the middle class."

The president better get his act together soon. A vote on the debt ceiling approaches, and the GOP has a strong hand to play. Republicans will insist that measures that sharply restrict spending be tied to raising the debt limit, and the public is on their side.

The administration has already declared that failing to raise the debt ceiling would have catastrophic economic consequences. Mr. Obama cannot allow that to happen. So he will be forced to bend to the will of the GOP, much more than he did in last week's budget showdown.

The president has no moral authority to insist Congress raise the debt ceiling without restrictions. As a U.S. senator, he voted against raising the ceiling, delivering a simplistic and crassly political speech he now says he regrets—but which he cannot erase.

After the debt-ceiling vote, Congress will then spend months on Mr. Obama's budget for the coming fiscal year, debating on territory advantageous to the GOP—namely, over how much to cut. Mr. Obama has demonstrated he's not serious about reducing the historic deficits and debt he's helped create. And unlike 2008, Barack Obama will be judged in 2012 on deeds rather than words.

This article originally appeared on on Wednesday, April 13, 2011.

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