It seems many on the left, like Paul Krugman, are quite happy with President Obama’s deficit speech. I will even admit to it being much better than what I feared, but that is only because some truly terrible trial balloons managed to set expectations incredibly low to begin with.
The important point of the speech for me, though, is that the president declared that a “balanced approach” to reducing the deficit still relies mostly on spending cuts, with two dollars in cuts for every dollar in new revenue.
Today, I’m proposing a more balanced approach to achieve $4 trillion in deficit reduction over twelve years. It’s an approach that borrows from the recommendations of the bipartisan Fiscal Commission I appointed last year, and builds on the roughly $1 trillion in deficit reduction I already proposed in my 2012 budget. It’s an approach that puts every kind of spending on the table, but one that protects the middle-class, our promise to seniors, and our investments in the future.
[...]
This is my approach to reduce the deficit by $4 trillion over the next twelve years. It’s an approach that achieves about $2 trillion in spending cuts across the budget. It will lower our interest payments on the debt by $1 trillion. It calls for tax reform to cut about $1 trillion in spending from the tax code. And it achieves these goals while protecting the middle class, our commitment to seniors, and our investments in the future.
Rhetorically, the de facto leader of the Democratic party is beginning with his goalpost already in conservative territory. Given how past negotiations have gone between President Obama and the Republican leaders, this isn’t a reassuring opening offer.
Is it really too much to expect that a Democratic president would at least start with the talking point that half-way or a “balanced approach” should by definition should be equal parts spending cuts and tax increases?




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it’s too little to expect.
he, and we, should not concede on the point that deficit reduction is bat-shit-crazy.
and we start with the talking point that the deficit needs to be INCREASED.
And of course the reality will be even worse. Here’s a blast from the past:
When O came into office, he talked about revoking the carried interest scam, which allows hedge fund and private equity managers to pay only a 15% income tax rate on their millions (or in some cases, billions) of earnings. Needless to say, when push came to shove, the proposal somehow fell by the wayside. Why would anyone with a functioning brain stem think that anything will be different this time around? Are You In(come Tax Freeloading)?
That might just be because he’s…conservative!
CPBB calls it a center-right plan.
http://krugman.blogs.nytimes.com/
Word. Have you read Glenn Greenwald’s piece on that?
Agreed, the parties should be fighting over the full employment deficit, trade deficit and the public investment deficits (i.e. combination of infrastructure deficit, education deficit and R&D deficit), not the budget deficit.
Jon did make a very interesting point here. The president’s balanced approach is as balanced as a broken chair and its worse than Jon thinks.
According to CBO budget rules, net interest on the debt counts as spending as do refundable tax credits (EITC and child care are the two big ones) to the extent taxpayers get a refund.
http://www.cbo.gov/ftpdocs/108xx/doc10871/Chapter3.shtml
I guess the best possible read on this is President Obama will veto any bill that cuts refundable tax credits (which, almost by definition, go to the working poor). Yeah right, he gutted the Making Work Pay tax credit last December.
Even if the President did restrict tax reform to solely deductions and other nonrefundable tax breaks, the $1 trillion in reduced “net interest” payments should clearly be counted as a spending cut. When the govt issues payment in accordance with a congressional appropriation, the word for that is “spending”.
Necessary amounts are appropriated for the following…
(2) to pay interest on the public debt under laws authorizing payment.
http://www.law.cornell.edu/uscode/31/usc_sec_31_00001305—-000-.html
Obama does not understand the plight of average Americans, because he is a private school, Harvard elite, nothing more.
We have to be color blind and not imagine that just because someone is African/Amrican, they are also possessing empathy.
beowulf, thanks for explaining! i found the president’s description of “balanced” incomprehensible. now i see that it was just incoherent. sad to have president obama give an important speech and have him sound about as bat-shit-crazy as any of the Rs.
the democracy deficit, the environment deficit, ……
so many real issues, so much wasted time, energy and words on a fake issue. :(