Obama, Deficit Hawk



For much of this year, I've been arguing that the Obama administration needs to pivot swiftly from health insurance reform to fiscal responsibility in the coming months. The recession made deficit cutting in the here and now imprudent in his first year; but now addressing the long-term debt is itself necessary for stabilizing the economy - and reassuring independent voters that he, unlike his predecessor, gives a damn about fiscal health. Well: the good news is that he's going to do exactly that:

President Barack Obama plans to announce in next year's State of the Union address that he wants to focus extensively on cutting the federal deficit in 2010 – and will downplay other new domestic spending beyond jobs programs, according to top aides involved in the planning. The president's plan, which the officials said was under discussion before this month’s Democratic election setbacks, represents both a practical and a political calculation by this White House. On the practical side, Obama has spent more money on new programs in nine months than Bill Clinton did in eight years, pushing the annual deficit to $1.4 trillion. This leaves little room for big spending initiatives. On the political side, Obama can help moderate Democrats avoid some tough votes in an election year and, perhaps more importantly, calm the nerves of independent voters who are voicing big concerns with the big spending and deficits.

This classic Politico piece - in as much as it regurgitates almost comically process-oriented Beltway wisdom - fails to mention a few things about Obama's spending in his first year.

Item one: the recession.

To treat the stimulus package as if it were something he just felt like doing - because he's a big government maniac - is a lie, a piece of propaganda that has seeped into the lazy Beltway desire to describe everything - even now - into the big government/small government, red-blue paradigm.

Item two: The health insurance reform almost painfully tries to pay for itself - something that Bush's Medicare entitlement didn't even pretend to do. 

Item three: there's a big big difference between spending on green and infrastructure investment and slashing taxes or increasing Medicare entitlements.

The way in which cynical and amnesiac Republicans have tried to portray this as classic big government liberalism is a lie. You can debate the merits of each initiative, but this is obviously not an administration as fiscally reckless as the last one. Mercifully, they have a chance to show it in earnest next year. And to call the bluff of those Republicans yelling about spending while having absolutely no plans or ideas for cutting it.

(Photo: Mark Wilson/Getty.)

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