Clinton-era budget chief Alice Rivlin warned Congress of three possible errors they could commit when legislating President Obama’s first stimuless package: Don’t get distracted from the need to jump start the economy by going Christmas shopping (exactly the opposite of “never letting a crisis go to waste”), don’t write expectation checks the economy may not be able to cash, and don’t wait until the economy recovers before getting busy on the real work of entitlement reform.
Perhaps predictably, having received the irresistible lure of a blank check from a novice president, veteran politicians Nancy Pelosi and Harry Reed promptly ignored that advice. And here we are:
Now, nearly three years after Rivlin’s warnings went unheeded, President Obama has groped his way to an agenda that looks more like what she originally recommended. His speech to Congress last week suggested that he intends to campaign for re-election on what should have been the blueprint for his first four years in office: a short-term stimulus highlighted by a payroll tax cut, a medium-term push to overhaul the tax code and a plan for long-term entitlement reform.
To Republicans, this agenda holds out the possibility that a second Obama term might feature more opportunities for compromise and common ground. But to voters pondering whether to make that second term happen, it amounts to a request for a presidential do-over — a tacit admission that the White House’s first-term agenda has been less than successful, and a plea for a second chance to get things right.
I honestly don’t blame President Obama for the current mess we’re in. He inherited a burgeoning crisis that nothing in his experience – writing auto-biographies, chiefly – could prepare him for. I do find myself wondering why Pelosi and Reed keep turning up every four to six years like bad pennies. Probably because, having clawed their way over time to the top of an ambitious heap of gift-givers – always with someone else’s money – that their constituents find their flaws charming.
It’s enough to make one wish that our constitution permitted a general plebiscite every four years allowing the ten most unpopular and destructive politicians to be removed from office. Such a thing would be anti-federalist, of course, and the pols themselves would never go for it.
But think of the possibilities.
Meanwhile, the Washington Examiner takes a look at Mr. Obama’s s new
stimuless jobs proposal, only to discover that the president’s only solution to any given problem is a hammer, which makes him believe that every problem looks like a nail:
The Jobs Act, which is best described as Obama’s Stimulus II, will cost somewhere around $450 billion — more than half as big as Obama’s first failed stimulus. White House Budget Director Jack Lew is the man charged with identifying how Obama will pay for this new spending bill. The answer will not surprise you: It’s all about tax hikes.
Lew kicked off Monday’s White House presser by saying he wants to limit tax deductions for individuals making more than $200,000 a year (and families making more than $250,000 a year), raise taxes on capital gains, raise taxes on oil companies and slow down tax depreciation of corporate jets. If that sounds familiar, that’s because it is the exact same list of tax hikes that Obama pushed Congress to include in its debt limit deal this summer. At that time, Obama was pushing these tax hikes as part of the “shared sacrifice” needed to reduce the debt. Now he’s using these same provisions to pay for even higher deficit spending.
Pressed to explain how Obama could use the same tax hikes to both meet the debt deal’s deficit reduction targets and pay for his new stimulus plan, Lew admitted that even Obama can’t count the same tax increases for two separate purposes. Instead, Lew said that Obama would be introducing a whole new slate of tax hikes next week, when he plans to give yet another deficit reduction speech.
Obama again insisted Monday that his second stimulus will be “fully paid for.” This is problematic on several levels. If Stimulus II is fully paid for with immediate tax hikes, then it isn’t the kind of deficit spending that Obama’s Keynesian logic demands. If it is only paid for later, at the end of the 10-year horizon, then this amounts to a budget gimmick, because Obama will be long gone from office by then.