Feature

Obama changes course to address jobs, deficit

Shaken by last week’s loss of a once-secure Senate seat in Massachusetts, President Obama moved to address voter concerns over the struggling economy and mounting federal deficits.

What happenedClearly shaken by last week’s stunning loss of a once-secure Senate seat in Massachusetts, President Obama moved this week to address voter concerns over the struggling economy and mounting federal deficits, proposing to cap spending on some federal programs for three years, expand tax credits to families with children, and use tax credits and capital-gains exemptions to boost hiring by small businesses. The proposals were set to be unveiled in President Obama’s first State of the Union address to Congress, which was scheduled for delivery as The Week went to press. A flexible “freeze” on discretionary spending would allow increases in some programs while imposing cuts in others; it would affect about 17 percent of the budget, exempting national security and entitlements such as Social Security, and save an average of just $25 billion a year over the next decade. “I’m glad he is willing to embrace spending controls of any kind,” said Republican Sen. Lindsey Graham, but “it’s a drop in the bucket.”

The president vowed to appoint a bipartisan committee to tackle the politically loaded task of reducing the federal deficit, after the Senate failed in a vote this week to create a similar panel. A poll this week showed Obama’s approval rating at 50 percent, but revealed overwhelming dissatisfaction with partisanship and perceived political dysfunction in Washington. “It is just an angry public,” said pollster Peter Hart. “The message is, ‘We hate what’s going on in Washington.’”

What the editorials saidThese proposals aren’t bad, said the Los Angeles Times, but the White House is addressing “the wrong problems.” We need programs to “put people to work and spur economic growth,” not tax breaks and budget gimmicks to appease an angry middle class. Such “pandering” won’t build confidence in the economy. Or in the presidency, said The New Republic. Obama was “a relative bystander” during the health-care debate, and let Republicans’ scare tactics and disinformation erode public support. To prove “his mettle,” Obama must now step up to the challenges and accomplish big things—health-care reform above all. “For the first time, we are nervous he isn’t up to the task.”

Obama’s “fiscal conversion is coming a year too late, assuming it is now real,” said The Wall Street Journal. For the second straight year, deficits will top $1 trillion; at this rate, interest payments on our national debt will be larger than all nondefense discretionary spending by 2019. If Obama is serious about deficits, he must abandon the health-care bill, cancel “unspent” stimulus funds, and kill the House bill that squanders another $150 billion in stimulus.

What the columnists saidThe “freeze” on discretionary spending is a “criminally stupid” policy, said Christopher Hayes in TheNation.com, but it’s worse politics. In one blow, the White House just endorsed the economic “ignorance that the right-wing has spent years stoking”—namely, the notion that government spending is wasteful (except for defense spending, which is sacred) and that fiscal stimulus doesn’t work. This is “political malpractice.”

What’s “so wrong” about riding public outrage? said Michael Scherer in Time.com. Prodding Congress to “start behaving responsibly” is good politics, and cutting such pork as farm subsidies would be good policy, too. With the Senate refusing to back a deficit-cutting commission (thereby shirking a future vote on its recommendations), it’s clear that Obama has to be the one to take responsibility.

But in doing so, he has to be “true to his own character,” said Kathleen Parker in The Washington Post. Americans elected a “visionary who promised a new spirit of cohesion, cooperation, and community.” By pretending to be a “fighter,” Obama risks losing the one thing that matters most: his credibility. One word I’ve never associated with Barack Obama is “gimmick,” said Ryan Avent in TheEconomist.com. But his plan for a spending “freeze” shows “a lack of seriousness” uncharacteristic of all he’s done before. If this is the best he can offer, Obama, his party, and America “are in for a very long few years.”

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