President Obama's liberalism is forcing him to adopt a conservative-looking budget plan.
Let me explain.
President Obama announced a comprehensive plan to reduce the deficit by $4 trillion over the next ten years today at George Washington University. Where do the savings come from? One trillion comes from higher taxes on the rich (via higher rates and lower deductions), one trillion comes from lower debt payments, and two trillion come from spending cuts across health care, defense and domestic spending.
A 3-1 ratio of spending cuts to tax increases appears somewhat conservative from a liberal president. Indeed, it's the same ratio as the fiscal commission's plan, which was considered center-right. Liberals would much prefer a 1-1 or even 1-2 ratio of spending cuts to tax increases. Indeed, the liberal plan from Rep. Jan Schakowsky relied almost exclusively on higher taxes and defense cuts.
Here's what's happening: Obama has decided he wants to protect 98 percent of families from ever paying higher taxes. That means all of his tax increases -- all $1 trillion of them -- come from the top 2%. You can't raise much more than $1 trillion from that group before you start talking about incredibly high effective tax rates for upper-middle class Americans. To hit his $4 trillion mark, therefore, Obama has to cut $3 in spending for every $1 he raises in taxes from the this group.
It's precisely Obama's liberal campaign promise that only the top 2% should pay higher taxes that forces him to rely on spending cuts to hit his $4 trillion mark. If liberals hit him on this ratio, they'll only have Obama's liberalism to blame.