Obama’s Budget Stops Pretending to Believe in Grand Bargain - By Jonathan Chait

[DonViejo]

Last year’s White House budget was a self-styled compromise offer, which put on the table concessions – like a stingier cost-of-living adjustment for Social Security, called chained Consumer Price Index, or “C-CPI” – that President Obama would accept only if Republicans reciprocated by closing tax loopholes, or making other concessions. To the surprise of nobody, they did not reciprocate, so this year’s White House budget pulls the proposal off the table.

Deficit scolds are crying hot tears of anger (Maya MacGuineas of Fix The Debt: “the nation needs the President to lead on this issue. The clear pullback on his part is a disturbing sign that he will not.”) Meanwhile, liberal Democrats are exulting (Stephanie Taylor of the progressive Change Committee: “This is a huge progressive victory.”)

In reality, the fundamentals of the situation have not changed at all. Last year, Obama was willing to adopt C-CPI in return for concessions Republicans would never, ever make. This year, Obama is still willing to adopt C-CPI in return for concessions Republicans would never, ever make. Putting the compromise in his budget was merely Obama’s way of locating the blame for the reality that Republicans in Congress will never, ever, ever strike a fiscal deal with him. The disappointed deficit scolds sitting just to Obama’s right, and the joyous progressives just to his left, are committing the same fallacy. They are mistaking a step premised on an impossibility for a semblance of reality.

I’ve seen Obama administration officials justify their contingent position on both practical and moral grounds. The practical case is that Democrats object fiercely to cutting Social Security, and they can’t cobble together the necessary votes from their party for any deal unless they get something in return. The moral case is that C-CPI places the burden of long-term debt reduction almost entirely on the middle and working classes, so fairness dictates it be balanced by some sort of progressive change. Obama has proposed closing tax deductions or loopholes that benefit the rich; I could see some other concession, like funding for pre-kindergarten education, serving this fairness function instead.

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http://nymag.com/daily/intelligencer/2014/02/obama-not-pretending-to-believe-in-grand-bargain.html

[blkmusclmachine]

1. Meh. We'll see...