Bin Laden, Political Capital, and Public Borrowing

The killing of Osama bin Laden doesn't change Obama's foreign-policy calculations very much, in my view--the pros and cons of an accelerated withdrawal from Afghanistan, for instance, are much the same as before--but it does give the president some fresh capital to spend on other good causes. Dealing with the long-term fiscal problem is one. This is the subject for my column today in the FT: Now Obama must lead on the deficit.

Under present conditions, the administration's tools for invigorating the recovery are limited, to be sure. However bold and decisive the president chooses to be, he cannot just decree faster growth. But if Democrats and Republicans moved immediately to raise the debt ceiling and promptly to clarify the medium-term fiscal picture - a task that cannot wait until 2013 - they would improve confidence and lessen the risk of a second recession.

The president can play a crucial role in this. Merely calling for unity achieves nothing. But the bin Laden operation gives him fresh political capital, though perhaps not for long. He should use it to impose himself - talking past a stone-deaf Congress to the electorate; advancing cold, clear choices about curbing long-term borrowing; thus making space, should it prove necessary, for renewed short-term stimulus. They call it leadership.

Politically, to jump so decisively into this quarrel would be risky. Few, despite Abbottabad, are betting Mr Obama will dare. It's not that he can't; for some reason, he won't.
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