After having had virtually nothing to say publicly on the Debt Ceiling negotiations, President Obama finally held a press conference – his first in more than three months. He said that the deal being negotiated to get Repubican support for raising the Debt Ceiling couldn’t consist entirely of spending cuts; some increase in revenues would have to be part of the deal. But Obama implied that he had already acquiesced to Repubican demands that no tax increases be part of the deal, and he plaintively argued that he was only proposing “to get rid of tax breaks for millionaires and billionaires; tax breaks for oil companies and hedge fund managers and corporate jet owners.” He asked for a “balanced” approach.
The President also seemed peeved over Repubican complaints that he hadn’t shown more leadership and, after pointing out that he had met with all constituencies, he scolded Repubicans for not working harder to solve the problem. He said he had tried “to be responsible and somewhat restrained” in explaining the consequences of not raising the Debt Ceiling, because he didn’t want to “spook” folks. He expressed several times his confidence that the Repubican leaders would “come to the conclusion that they need to make the right decisions for the country” and that they would back off their “maximalist positions” and “do the responsible thing”.
The media’s description of this timid dipping of the presidential toe into the negotiating waters was, shall we say, overwrought. “Obama Takes Congress, GOP To The Woodshed”! “Obama Intensifies Pressure On Republicans”! The response of the Repubican leaders bordered on the hysterical. They described the President’s statements as “disgraceful” and accused him of “class warfare”.
All of the negotiations have, so far, been conducted in private and the parties have been pretty tight-lipped about the framework of the impending “deal”. But once the lead Repubican negotiators walked out of the negotiations with Vice President Biden, because the Democrats were asking for some revenue increases, details began to leak out. It appears that the Democrats have agreed to around $1.3 trillion in spending cuts over the next 10 years, including between $200 billion and $300 billion in cuts to Medicare. Cuts to Pell Grants and cuts to programs to feed poor women, infants and children appear to be part of the $1.3 trillion. Funds designated for infrastructure repair are also rumored to be on the chopping block, as are funds for monitoring air quality and food quality. Rumor also has it that funds to regulate and monitor Wall Street will be eliminated. On the revenue side, the Democrats are apparently arguing for only $130 billion over the next ten years – from plugging the loopholes the President mentioned – but it doesn’t sound as though the Repubicans have agreed to anything.
This “deal” is, in a word, pathetic.
In the past, I have been critical of the President’s approach to negotiations with the Repubicans and I agree with the Repubicans that the time for President Obama to lead is long overdue. In response to the Repubican faux-outrage at Obama’s statements on Wednesday, Obama should schedule an address to the nation in which he lays out the problem and tells us what he wants Congress to do to solve it. And he should ask the American public to let their representatives know whether they agree with him or with the Repubicans. (We already know that while Americans are split about 50-50 on raising the Debt Ceiling – undoubtedly because they don’t understand the issue – around 80% of Americans want increased taxes on the rich as part of any deal to lower the deficit.)
The President’s address should cover the following:
1. Why is raising the Debt Ceiling important?
ANSWER: Raising the Debt Ceiling is necessary to pay for obligations already incurred by previous commitments of Congress. As the President pointed out on Wednesday, it’s like buying a car on credit or borrowing to take a vacation. You can’t just say later that you don’t want to pay. If we don’t raise the Debt Ceiling, we will be in default on our previously incurred obligations and the consequences for the United States and the world economy would be catastrophic. Obama can’t be “restrained” in explaining the consequences or worry about “spooking folks”. He has to lay it out there and scare the crap out of people.
2. How did we reach a point where the Debt Ceiling must be raised?
ANSWER: The Bush tax cuts, two unfunded wars, an unfunded Medicare prescription drug program, and a recession brought on by policies of the previous administration and the greed of Wall Street combined to cause the National Debt to spiral out of control. When Repubicans claim we don’t have a revenue problem, they’re wrong. The Bush recession has caused tax revenues for 2009-2011 to be $1.5 trillion less than revenues from 2006-2008. The Bush tax cuts have cost the government another $4 trillion over the past 10 years. The President should use graphs to show how job losses under Bush were increasing monthly – at the rate of 750,000 a month when Bush left office – and compare this record to the diminishing job losses, turning to job gains, under Obama.
3. Obama should make the argument that Repubicans can’t be genuinely concerned about the deficits or about the increase in the Debt. If they were, they wouldn’t have insisted last December that tax cuts for millionaires and billionaires be left in place, on threat of not allowing any legislation to be passed. That bit of blackmail caused the deficit for 2011 and 2012 to be hundreds of billions of dollars greater than it otherwise would have been. And if the Repubicans really cared about the deficit, would they have approved the Bush tax cuts and voted seven times during the Bush Administration to raise the Debt Ceiling?
Will Obama be accused of being partisan? Of course. It’s time – finally – to get partisan. The Repubicans will accuse him of it anyway. Obama has to remember that the stated goal of the Repubican leaders has been to make him fail. They hate him. Sen. McConnell recently said that if the economy doesn’t improve, that will be good for Repubicans in 2012. Many of the Repubicans don’t care whether the U.S. defaults; indeed, some of them want that to happen, because they think it will force the government to make drastic cuts in spending – something they have wanted for decades – and they think they can blame the any damage to the economy on Obama. Repubicans have obstructed everything Obama and the Democrats have attempted to do to govern and to improve the economy. Rather than pay for the debts and commitments the U.S. HAS ALREADY INCURRED BECAUSE OF THEIR POLICIES, the Repubicans are – once more – engaging in obstruction and blackmail by insisting that if the Democrats don’t agree to deep cuts to programs that help the old, the young, the sick and the poor, the Repubicans will allow the U.S. government to default on its obligations.
As I pointed out months ago, it’s become a question of politics – of persuading the American people that it is the Democrats – not the Repubicans – who have their best interests at heart. The President has to take the negotiations out from behind closed doors. Using charts and graphs, he should itemize the spending cuts demanded by the Repubicans and translate those cuts into real-world consequences for those affected – how many students will not be able to go to college, how many kids will be shut out of Head Start, how many people will go hungry, how many roads, bridges and levees will remain defectively dangerous, etc. He should juxtapose a list of the revenue generating items proposed by Democrats with the Draconian cuts proposed by Repubicans and ask whether preserving tax breaks for hedge fund managers, oil and gas companies, corporate jet owners, etc. is more important than clean air and water, uncontaminated food, kids participating in Head Start, young men and women getting a college education, decent health care and social security for our elderly, etc . He has to make the case that the Repubicans stand for the rich and for the big corporate interests, not for the average working American. He has to compare the Democratic vision for the future with the Repubican vision and ask America: Which do you want?
If President Obama really believes the Repubicans will “do the responsible thing”, i.e., agree to a balanced deal in connection with raising the Debt Ceiling, then he is a fool. If he caves in on these negotiations, as he did in December and again in April, and especially if he agrees to cuts to Medicare and Medicaid, thereby depriving Democrats of their most potent argument in 2012, then he is an incompetent fool. If he folds now, what can we expect when the 2012 budget is negotiated? Or when extension of the Bush tax cuts beyond 2012 is on the table? The Repubicans will take him to the cleaners again. Obama’s presidency – not to mention the American economy – is on the line here and it’s time for him to lead and fight for America. Obama has to draw the line and if the Repubicans continue to play “chicken”, then he must ignore the Debt Ceiling and declare it unconstitutional, citing the Fourteenth Amendment for the requirement that the U.S. honor its debts. The Repubicans will scream and there will be calls for Obama’s impeachment, but eventually, the Repubicans’ masters on Wall Street and in the board rooms of corporate America will force the Repubicans “to do the responsible thing.” Obama will be seen as a strong leader and will be reelected in 2012. The Repubican Party will be in disarray. But if Obama rolls over again, history will view him harshly and America will suffer greatly. Does the thought of President Romney, Vice President Rubio, and two more Justice Alitos on the Supreme Court make your blood run cold? No? Then you haven’t been paying attention.
Make the case, Mr. President.