Federal budget won’t be reined in under Obama

White House officials selling President Barack Obama’s new budget have focused on his proposals to expand such Democratic Party standbys as education and job training.

But given the likelihood that Congress won’t buy these, Obama’s more significant proposal may be his decision to withdraw last year’s proposed limits on Social Security benefits as a first step in renewing bipartisan efforts to rein in long-term federal spending.

It underscores the fact that Obama’s hopes of dealing with this long-festering problem are dead for the remainder of his administration.

Obama had hoped that, in return for a Democratic initiative cutting costly entitlement programs, the Republicans would renew their 2011 offer to accept revenue increases, presumably through tax reform that closed loopholes giving special preferences to business and wealthy taxpayers.

Unfortunately, Obama’s proposal went nowhere at a time the bases of both parties had already indicated reluctance to take the necessary steps to reach such an agreement. The fact that an improving economy is reducing the current federal deficit has reduced pressure to do something now.

The reasons many Democrats made it clear they wouldn’t accept even a modest cutback in Social Security benefits are twofold: The bulk of the long-term spending problem lies not there but in the soaring costs of Medicare and Medicaid, and they are unwilling to curb the program that represents their party’s most significant political legacy.

Similarly, a majority of congressional Republicans resisted House Speaker John Boehner’s effort to accept some $800 billion in revenue increases during his unsuccessful July 2011 talks with Obama. Those talks were the best opportunity of recent years to reach a significant budget agreement.

A special 12-member congressional panel’s subsequent failure in November 2011 to agree on a more modest package of spending cuts and revenue increases signaled the end of serious efforts to enact a significant spending control measure.

Thus, once again, the president and Congress have done exactly what Obama had been determined to avoid.

“What we have done is kicked this can down the road,” he told the Washington Post editorial board in discussing the nation’s fiscal problems just days before taking office. “We are now at the end of the road and are not in a position to kick it any further. We have to signal seriousness in this by making sure some of the hard decisions are made under my watch, not someone else’s.”

But Obama’s new budget continues to kick the issue down the road by conceding tacitly that the onset of election-year politics prevents any serious effort in 2014. After that, the 2016 campaign will have a similar effect.

It’s one of the more notable programmatic failures for a president who has achieved some success on many of the major proposals he campaigned on: national health care, reform of the securities markets, economic recovery and an end of U.S. involvement in Iraq and Afghanistan.

And while the two parties share the blame, Obama can’t escape responsibility for fumbling the best opportunity he had to lead on the problem: the December 2010 proposal of his own bipartisan commission, headed by former Sen. Alan Simpson, R-Wyoming, and former Clinton White House chief of staff Erskine Bowles.

To be fair, that panel, which was filled with serious budget thinkers from both parties, itself failed to agree on the package of spending cuts and revenue increases proposed by its two co-chairmen. And its inclusion of entitlement cuts and tax increases posed political perils, which explains why so few political figures endorsed them.

But the Simpson-Bowles plan could have been a good starting point for Obama. But he never acknowledged his support, though it was roughly similar to his administration’s approach.

Of course, congressional Republicans showed even less willingness to deal with the problem. And any serious effort to curb spending requires both the president and the opposition party to deal with the exploding cost of entitlements and a badly skewed tax system.

Perhaps the next president will make it a major priority. But there is no guarantee that will happen, especially when neither party is willing to face reality and a brightening short-term fiscal outlook creates the misleading impression that the long-term problem isn’t really so serious.

By Carl Leubsdorf

Carl P. Leubsdorf is the former Washington bureau chief of the Dallas Morning News. ― Ed.

(The Dallas Morning News)

(MCT Information Services)