Thursday, April 14, 2011

The President's partisan 'budget' speech- The first political stump speech of 2012?

Yesterday the President delivered what was undoubtedly the first political stump speech of 2012 to a friendly audience at George Washington University.  Under the guise of a new and more "serious" approach to the nation's burgeoning budget deficit, the President's speech-- laced with class warfare, revisionist political history, and extremely partisan attacks on Republicans and their budget-hawk policies while delivered in an argumentative political style-- was interestingly timed to immediately precede no less than three Presidential fund raisers last night in his home town of Chicago in front of Democratic groups, (a fact that did not escape notice of his supporters on the left OR his critics on the right). 

 Indeed, in light of the coming 2012 Presidential elections forecast to cost as much as 8 BILLION dollars, (yes, that's with a 'b'!), catering to one's base of party activists who give the most money, time and energy to election efforts will be increasingly important to the President as the election draws near, (even at the risk of alienating some Independents, but see previous posts on Obama's tendency to dithering and the dangers thereof here and here).  

  True to form, as most of the President's speeches, it was big on "feel good" themes and short on specifics, even while it ridiculed Republicans' for their budget ideas and deficit-reducing proposals, (particularly those put forth by the Chairman of the U.S. House Budget Committee, Paul Ryan, (R-WI), who has been in the lead on this critical issue).

 To add insult to injury, in "stick-in-the-eye" fashion, the President had personally invited several of his political opponents, including Congressman Ryan, to sit in the front row while he gave his speech, (forcing them to endure what must have been an extremely uncomfortable experience while the President droned on and lobbed partisan attacks at Ryan's recently unveiled deficit-cutting proposals and Republicans in general during the 43 minute long speech; indeed, so long was the speech that even Vice President Joe Biden became ostensibly bored at this display of same old same old and dozed off, see picture here).  

  Most importantly, (ominously?), coming on the heels of the recent budget "agreement" staving off a government shutdown that has yet to be approved by the full House, (a vote is expected imminently), it does not bode well for future bi-partisan cooperation between the Obama Administration and the Republican-led House; indeed, other than for pure political gain in his upcoming election we are hard-pressed to see how the President's actions could be interpreted as anything but unappreciative-- to put it mildly!-- of the lauded bi-partisanship expressed in his just-reached budget agreement with Republican Congressional leaders. 

 Indeed, in what has become almost an article of faith of the American political left, the President repeated his mantra that the deficit problems we face as a nation more than half-way through his administration's four year term are still somehow attributable to former President George W. Bush, and, as above alluded to, continued the Democrat staple of bashing the "rich," (seemingly belying the basic economic understanding that the only ones in society with the capital to create new jobs and factories are "the rich" and the fact that the top 10 percent already pay almost 70% of the taxes and the bottom 49% pay nothing at all!). 

    Nevertheless, and repeating the oft-cited canard that Republican economic policies "give tax cuts to millionaires and billionaires" even while he simultaneously credited the Clinton administration for the bulk of any national prosperity over the last 20 years--  conveniently ignoring the critical role that the (then) newly elected Republican Congress played when it took over the House in the historic 1994 elections and forced President Clinton to agree to important systemic changes such as capital gains tax reductions welfare reform-- President Obama predictably proceeded to call for a repeal of the Bush tax cuts in 2012, higher taxes on job creators, unspecified reductions in health spending, and an almost 40% cut in military spending over the next 12 years!

 While acknowledging the need to cut government deficits and suggesting a cut of four trillion dollars to the federal deficit over that same 12 years-- never mind that all other budget proposals are historically implemented over 10 years and that all Obama's proposed "cuts" take place after the 2012 elections when he is (ostensibly) re-elected and there is no longer any way to hold him accountable if such cuts don't materialize-- the President's speech conveniently ignores that this leaves a full 2/3 of the deficit intact, (8 TRILLION dollars, with a 'T'!), and actually results in an increase in spending as compared to today.  

 Still, it was good to hear the President, at least in principle, concede the Republican argument that failure to deal with the deficit now will necessitate sudden and catastrophic cuts to all government programs later at a time we might not be able to choose how or the rate of change at which we wish to proceed, including medicare and social security, (the very programs it is oft repeated Dems want to "save.")  

 Ironically, while denying that "waste and abuse" play as significant a role as the Republicans, (and a recent Government Accounting Office report has suggested, see here and here to download full report), the President at the same time promised that his draconian cuts to American defenses will come, yup, you guessed it, from eliminating the very "waste and abuse" he claims is not significant in other areas (even as he claims such cuts will not harm what he termed "my most important obligation," that of defending the nation's security).  How exactly Obama plans on pulling off this feat in the midst of three wars-- one of which he started without a clear strategy of America's role or exit plan-- even as cracks appear in the coalition cobbled together by the U.S. Administration after getting U.N. Security Council "approval" for intervention in the African country, see here--  is an extremely open question, (see Parts I and II of our analysis of the Obama Administration's disregard of the War Powers Resolution Act last month and the imminently forthcoming Part III of our analysis on this blog).   Indeed, some would say such difficulties were all but destined to occur in the face of the ambivalence and abdication of American leadership in this action and with the professed goals of the coalition under the U.N. Security Council resolution limited to "protecting" the populace from Ghadaffi, rather than the badly needed regime change of which the  resolution is silent, (to say nothing of the dubious support of the American people!).

 Be that as it may, and in similar fashion to his State of the Union address, the President also repeated his extensive list of "investments" he feels the federal government is obligated to make-- read more deficit spending-- for pet programs we can neither afford nor is even certain that we need, (such as high speed rail, promotion of alternative and unproven energy sources while vast oil resources in Alaska sits untapped, increased technology spending and increased educational spending).  

 And while the President spoke of the importance of repairing and upgrading infrastructure like roads and bridges, in light of his spending "laundry list" and already strained-to-the-max spending in times of budgetary deficits, it is unclear where such money will come from, (and wasn't such "shovel ready" projects what the "stimulus" was for?!) 

Worst of all, the President continues, in spite of all evidence to the contrary and the great concern of vast numbers of Americans of all political stripes, that the economic effects of Obamacare-- in spite of its covering 50 million more people, translating to an increase in health care of at least 15%-- will result in a decrease instead of an increase in health care costs, (for our full analysis of this issue and related issues see last month's post "So what's really the problem with Obamacare?").

 Don't get me wrong... such facts were certainly nicely wrapped up-- or, depending on your perspective-- obscured, by glowing rhetorical flourishes and references to by-gone eras of "bi-partisanship" and America's admittedly generous and free heritage.

 In that light, if what you want in a President after 8 years of Bush's admitted weakness in public speaking skills is someone who can make you feel all "warm and fuzzy" inside with his mastery of the English language, professorial delivery and lofty political rhetoric-- even if the reality is nowhere near the economic facts-- then Obama is clearly your man.

 And while we won't here go into all the false presumptions, inaccuracies, and partisan jabs in the President's speech here, (for a video reply by Representative Ryan himself click here, for a full summary of the actual policy facts in written form click here), that is not really our goal.

 But it is certainly safe to say that any notions that the 2012 re-election campaign of this Administration hasn't yet kicked off-- as if in light of recent events any evidence were needed of this fact-- were handily dispelled by the President's front row and very personal performance for Representative Ryan. (Perhaps the President needs to spend a little less time polishing his speeches and a little more time brushing up on his manners? He did, after all, just finish gushing over the bi-partisan budget agreement with Republican speaker Boehner, (see last post this blog).  Indeed, such an about-face towards Republicans' and/or brazen attacks on their deeply-held principles does not bode well for the much more controversial debates ahead on the 2012 budget (which haven't even started but are about to).  Just because we've dodged one bullet in the way of government shut-downs doesn't mean there won't be others; indeed, we would be surprised if there weren't and could manage to avoid a shutdown-- or at least multiple threats of one-- before the year is out, (if not sooner!). 

 So strap on your seatbelts kiddies!  It's going to be a fun ride this election cycle, at least until the voters settle whose policies they trust more in 2012 once and for all.  jp

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