Tonight's press conference is about the budget over the long-term, and not about the budget's predetermined short-term path. You've got to think that having complete control of the legislative branch means that the land is already sold; Obama and Congress are simply haggling over the number of upstairs and bedrooms and the color of the stucco...and although they'll prudentially give due consideration to the question of whether this family can really afford such an investment, the answer is a pre-ordained conclusion, even for so-called budget moderates. The White House understands that it won't get all it wants, which is one reason why it loaded up on spending in the stimulus package and conveniently postpones some spending (on cap-and-trade, for example) until the economy recovers. A relatively stingy mark from the Senate budget committee chairman, Kent Conrad, and a somewhat more generous (but probably more quirky) pleading from the House of Representatives are expected. If kept to schedule, the broad outlines of a budget will yield to the beginning of the appropriations process fairly soon, and Obama can turn all of his attention to the major constituents of his antebellum economic agenda. There are plenty of particulars to haggle over.   What the White House wants to know, and what they don't know, is whether public anger at major institutions will panic Congress into political foreclosure. 

Notice that almost every major economic decision President Obama is predicated on the theory of delayed and deferred pain: a stimulus package (money for people), bailouts (money for corporations), the creation of money by the government (money!).  Within six months, true tradeoffs will begin to make themselves apparent to the American people: will they tolerate higher taxes? Less Social Security? Higher short-term energy costs? Higher deficits? Higher interest rates?  Can they sacrifice the local (say, a coal plant) for the benefit of the global (emissions caps and biofuels?)  This is the hard sell, and the broad outlines of it begin tonight.

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