Meanwhile, Paul Krugman at the Times rather sensibly declares, “The Obama budget isn’t going to happen, so in a sense it’s irrelevant.” Then, exploring the rhetorical implications of this budget, Krugman says Obama “has effectively given up on the idea that the government can do anything to create jobs in a depressed economy. In effect, although without saying so explicitly, the Obama administration has accepted the Republican claim that stimulus failed, and should never be tried again.” Of course, if you’ve been reading Krugman on the stimulus, you might expect what follows:
What’s extraordinary about all this is that stimulus can’t have failed, because it never happened. Once you take state and local cutbacks into account, there was no surge of government spending.
Krugman provides a chart to demonstrate his point: a line showing “Government Current Expenditures” dips deeply in the 2008-2009 recession period. He concludes that while the non-starter budget seems an admission that the stimulus didn’t work, in actual fact, “Fiscal policy didn’t fail; it wasn’t tried.”
Washington Post wunderkind blogger Ezra Klein also steps back from the details of the twenty-pound budget to look at it as a political tool or statement in a roundup of wonk reactions published painfully early this morning. The budget is a potential first chess move in doing unpopular entitlement reform, argues Klein, without necessarily getting the unwanted credit. Perhaps he’s onto something. Discussing the budget’s missing entitlement reforms in a presser today, Obama said the recommendations of his deficit commission had not been shelved, but “still provides a framework for a conversation”—a conversation of which the budget is a part, but not the conclusion. And Jacob Lew, the president’s budget director, has said that addressing mandatory programs would best be handled in closed-door discussions.
it’s worth remembering that this is the White House’s opening bid in a negotiation that’s just getting started. They have made a decision—perhaps savvy, perhaps not—to leave it to the Republicans to take the first step on entitlements and tax reform. The Republicans, due to their criticism of this budget, now have to offer something more far-reaching in their proposal. If they come up with a plan people like and some votes for it, the White House can join with them in negotiations and eventually sign onto a grand compromise. This budget will be largely forgotten. If they come up with a plan people hate that clearly can’t get the votes, the White House can attempt a replay of the mid-1990s and hammer them with it.
This budget doesn’t lead on long-term deficit reduction. But that’s not necessarily because the White House is uninterested in that discussion. Note the section laying out the White House’s interest and position on Social Security reform. Rather, they’re keeping their options open until Congress makes the first move.
At The New Republic, Jonathan Chait sees the budget in political terms as well. For Chait, the budget is a demonstration that the White House is trying to change the idea, seemingly lodged deep in the American mind, that government is riddled with waste and bureaucracy. Chait says it’s meant to be a conversation-changer. He writes:
The message, sometimes made explicit, is that the budget actually does not contain a lot of waste. It’s filled with programs that have survived many previous rounds of belt-tightening for a reason. If you want to cut the budget, you have to cut useful and necessary things . He’s explaining to the public that the free-ride view of budget cutting —we can cut our way out of the deficit by eliminating waste and spending that only benefits foreigners—is wrong.
Naturally, those on the right don’t see the politics as being so clever, or so benign. But they do see the politics. Leaping off of Sullivan’s blog post—“I suppose Sullivan was one of the last to figure this out”—blog Power Line concludes, Obama “is playing a game of chicken.”
He puts forward a series of proposals that he knows are more or less insane; but he also believes that Republicans will come to his rescue. They, not being wholly irresponsible, will come up with plans to reform entitlements—like, for example, the Ryan Roadmap. Ultimately, some combination of those plans will be implemented because the alternative is the collapse, not just of the government of the United States, but of the country itself. But Obama thinks the GOP’s reforms will be unpopular, and he will be able to demagogue them, thus having his cake and eating it too. Is that leadership? Of course not. But it is the very essence of Barack Obama.