Friday, April 22, 2011

Center-right perspective when hungry for center-left solutions

Almost two weeks ago I lamented that there weren't any Democrats explaining what was in the federal budget and why it was important. Such a Dem was needed to counteract the GOP attempts to gut federal spending and all the help it provides for the middle class and the poor.

I'd love to say -- but know it isn't true -- that my plea inspired the prez. A few days later in his much discussed "Fiscal Policy" speech to the nation he said a great deal of what I was hoping a Dem would say. Alas, it is only now (more than a week later) that I have time to comment on it.

It took a bit of time to find the text of the speech on the White House website. I finally did and read through it. I thought he did a good job of explaining the situation to the common person in language they are likely to understand. He also upheld progressive ideals fairly well. However, the test will be whether he bargains it all away with an intransigent GOP or he can keep explaining his position to get the average American on his side, as he did during the campaign. His recent road trips suggest the latter, but at the moment he isn't across the table from Boehner (yes, I have reasons of being skeptical -- see my posts of last December).

One reaction I have to the speech is why didn't he start saying this last December, before he gave up a trillion dollar tax cut to the rich? Why hasn't he been saying something similar over the last two years? The GOP mantra of cutting taxes and cutting spending is not new -- they've been at it for 30 years now. Why hasn't any Dem been saying this loudly and repeatedly in the last 30 years? But I try not to dwell in the past.

However, I'm not the best one to review the speech.

William Galston, in an article at the Huffington Post, called it "forceful." He also provides a chart of six different budget proposals, one by the Fiscal Commission, the Bipartisan Policy Center, one apparently put out by Galston himself (though how it came to be are not explained), the House Republican Plan, the budget Obama released last February, and what can be inferred from this speech. I haven't waded through the chart.

Robert Borosage of Campaign for America's Future (a progressive group) rated the speech against a Citizen's Guide to the Budget Debate. This guide was posted the day before Obama's speech as a way of evaluating both Obama's remarks and the House GOP budget. Also appearing are budgets from the "Gang of Six" and the Congressional Progressive Caucus. A lot to wade through. The essential points of the guide:

* As Joseph Stiglitz said (and I quoted somewhere recently) "The best way to reduce the deficit is to put people to work."

* Tax them that's got it. As I've said before, we have enough money to do a lot in this country. It's in the pockets of the rich.

* Don't spare Defense.

* If it ain't broke, don't fix it. The big entitlement programs are targeted through a fake crisis.

* We don't have a broken Medicare and Medicaid system. We have a broken health care system. Fix what is actually broken.

* We have an infrastructure deficit, investment deficit, education deficit, research and development deficit, among others. We can't cut our way to prosperity. We must invest in our future.

So how did Obama's speech stack up against this guide?

* Obama started from the premise that any effort to boost jobs won't get through Congress. We need to lay out a plan to reduce the deficit now, but this is the wrong time to actually be making cuts.

* Obama did talk about raising taxes on the rich, but his spending cuts are bigger than the tax hikes.

* His proposed cuts in Defense don't go deep enough.

* Obama did a good job of protecting Social Security and saying discussions for long-term health should start now. Alas, the GOP is opposed to the best solution of raising (or eliminating) the cap on payroll taxes.

* Obama got health care right -- fix the whole system, not eliminate Medicare and Medicaid.

* He said the right things on investing in our future, but his cuts to the budget means the GOP has actually won this debate.

My summary: Obama has already conceded too many important points.

Borosage went into more detail in a posting the day after the speech. Obama stood firmly against the nastiness of the House GOP budget. However, he did so from a center-right perspective in a country hungry for center-left solutions. And that is before starting negotiations with the GOP. A few of Borosage's points:

* With this premature embrace of austerity and no effort to stimulate jobs, mass unemployment may become the new normal. Wages stagnate, the middle class will decline. Obama expressed sympathy but said budget deficits will cause "real damage to the economy." And 25 million un- and underemployed won't?

* Obama was too timid on several needed items, such as deeper cuts to defense, progressive tax reform, and a financial transaction tax to reduce financial speculation. As a result he will cut the domestic programs we need the most.

It is understandable that Obama started with a center-right perspective. The rich have mobilized big time to protect their privileges.

That leaves America's future in our hands.

The House Congressional Progressive Caucus has outlined a budget with these features.

* Raise taxes on the rich, including taxing capital gains as regular income.

* Maintain Medicare and allow it to bargain with drug companies for bulk rates.

* Spend $1.45 trillion on investments in our future.

* Raise the payroll tax to cover Social Security.

Result: a balanced budget by 2021 at about 22% of GDP, a much more realistic number than the 15% of the House GOP budget.

Sometime soon (hopefully) I'll look at articles and postings about the GOP budget.

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