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How Obama Seized the Political High Ground in Budget War

Washington conventional wisdom has convinced itself that Obama has been on the losing end of the budget debate. But with his speech yesterday, Obama seized the high political ground that will heavily define his second two years in office.
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For several months, Washington conventional wisdom has convinced itself that President Obama -- and Democrats in Congress -- have been on the losing end of the deficit-budget debate. But with his speech yesterday, President Obama seized the high political ground in the budget war that will heavily define his second two years in office. Four factors have changed the political equation.

First, Obama changed the frame of debate from the realm of policies, programs and green eye-shades into a contest between the progressive values that have always defined what is best in America and the radical conservative values of the Gilded Age.

The right always goes to political war armed with a full complement of value-based arguments and symbols. They are very good at clothing the self-interest of Wall Street/CEO class in talk about freedom and individualism and self-reliance.

We lose when we talk about policies and programs and they talk about right and wrong.

But the moment we transform the debate into a contest between progressive and radical conservative values -- between the progressive and conservative visions of the future -- we completely change the political equation.

Yesterday, President Obama argued that the debate about the federal budget is actually about two very different visions of American society:

  • Are we all in this together -- or do we believe in a society where everyone is out for himself and himself alone?
  • Should we simultaneously take responsibility for ourselves and look out for each other -- or should the strongest and most clever among us simply be allowed to dominate and exploit the rest?
  • Do we aspire to hope and possibility -- to the belief that we can shape a better future for our kids? Or are we ready to concede that we can no longer afford to assure that every child has the education she needs to fulfill her potential =- or that seniors should be denied a dignified life in their retirement -- or that if you're sick and poor, you're just out of luck?

Our religious traditions make it clear which side of this value debate embodies the true aspirations of most Americans -- as does our choice of heroes and heroines.

We uniformly admire men and women who embody our belief that the highest calling is standing up for each other. We honor people like Martin Luther King, Ghandi, Mandela, Lincoln, Kennedy, Roosevelt, Elizabeth Cady Stanton -- people who fought to broaden the realm of freedom -- who embody the view that all people are created equal and that our society should provide everyone opportunity.

The list does not include robber barons or defenders of slavery.

When we proudly assert our progressive values, we win.

Second, the elements of the president's budget program are immensely popular.

The beltway pundits would have you believe that to have a "serious" budget plan you have to do things that are "painful" and "unpopular." The only reason that would be true is that they often advocate taking actions that are beneficial only to the top two percent of the population at the expense of everyone else.

They say that to be "serious" we have to cut Social Security for seniors who make an average of $19,000 a year and give tax breaks to people who make tens of millions -- sometimes billions a year.

It's easy to see why that would be pretty unpopular with most people. To make it palatable to ordinary people you have to convince them that they need to take the "bitter medicine now" so they can have a better life -- or avoid an even more dire fate -- in the future. This, of course, is self-serving hogwash. To have a better life in the future we don't have to give more wealth to Wall Street and the rich, and sacrifice investments in education, research, infrastructure and a decent life for senior citizens. Just the opposite.

Of course we need to do what is necessary to pay for what government does. But the choice we face is not between short-term pain and long-term prosperity. It is between a better life for most people and the greed of a few people.

President Obama's proposals are very popular because if we clearly lay out the true choices, normal people are smart enough to understand their own interests. Eighty-one percent of the population favors increasing taxes on millionaires. Huge percentages oppose cuts in Medicare and Medicaid. They oppose eliminating Medicare and replacing it with vouchers that steer you to buy private insurance. They certainly oppose increasing out-of-pocket costs for seniors on Medicare by $6,400 -- which the non-partisan Congressional Budget Office says is the direct consequence of the Republican budget. They support making smart, appropriate cuts in defense spending. They support investing more, not less, in education and scientific research. They support more money -- not less -- for Head Start, nutrition programs, to pay for police and fire protection, to build schools and bridges and high-speed rail. They support investing more money in clean energy.

Democratic budget priorities are popular precisely because they reflect the progressive values that are shared by the vast majority of Americans.

Third, the president established two additional important framing points:

  • Eliminating the budget deficit is not inconsistent with progressive priorities. This should be obvious to anyone with an ounce of memory, since the last time the budget was balanced was just ten years ago and that was done under Democrat Bill Clinton. However, it was necessary to make this point clear by presenting a plan to achieve fiscal balance that also embodies progressive values.
  • Controlling health care costs -- which is a major driver of increased spending -- is not the same as simply shifting these costs to seniors and the disabled. Controlling costs is about actually controlling increases in the costs of delivering health care -- chief among which are the outrageous costs of prescription drugs. Obama reintroduced a major way to cut health care costs into the debate: Allow Medicare to use its buying power to negotiate lower drug prices. But that of course would lower the profits of the drug companies.

Finally, Obama has outmaneuvered the Republicans.

Obama's strategy was to settle the short-term 2011 budget battle in order to eliminate the Republican weapon of the short-term government shutdown. That was a key leverage point because it was very much in Obama's interest to avoid the economic damage that a shutdown would cause to the fragile recovery. He wanted to get the best deal he could in terms of pure dollars and cents. But his main goal was to come to an agreement that avoided a shutdown, but did not compromise structural or policy issues that would reshape the political and economic landscape far beyond the September end of the fiscal year. In that, he was largely successful.

By coming to an agreement before he launched the broader policy debate he also had the opportunity to see exactly how far the Wall Street/CEO faction of Republican Party and the party's political elite would allow the Tea Party faction to go in pursuit of its program. Turned out that they were unwilling to shut down the government over the Tea Party social agenda.

Obama also wanted to wait to seriously join the debate until after the Republican budget chair, Paul Ryan, had unveiled the details of their budget plan that lays bare the real contours of the right-wing vision for everyone to see. That allowed him to clearly contrast a progressive vision with a fully articulated Republican blueprint.

Obama has changed the terms of negotiation -- the benchmarks -- from pure dollars cut, to questions involving the purpose of government and our vision of society. That makes it much easier for him to draw clear lines in the sand -= as he did yesterday. He pledged unequivocally not to privatize Medicare, not to block grant Medicaid, and not to sign another extension of the Bush tax cuts for the wealthy.

At the same time, his proposals allow him to take off the table the issue of how much Democrats want to reduce the deficit. He presented a plan that matches -- and actually exceeds -- the Republican deficit reduction goals. That leaves the only question for debate the issue of how that goal is achieved, which is the strongest Democratic political ground.

What about Republican claims that they will hold an increase in the debt ceiling hostage to their budget demands? They are nothing but bluster. If the Wall Street/CEO faction were unwilling to allow the Tea Party to shut down the government, they certainly are not going to allow them to explode the economy and financial markets with government default.

Obama Senior Advisor David Plouffe has said that both Republicans and Democrats know that we have to increase the debt ceiling so that it's really not an issue. In other words, the administration simply plans to call the Republicans' bluff. That eliminates any leverage provided by the debt ceiling vote.

The Congress does not need a "budget" for fiscal 2012 and beyond. To continue operating, the government does need new appropriation bills for 2012. Those will become the focal point of the next "shutdown" drama, but that will once again likely involve numbers and spending levels -- not the long-term structural questions posed by the Republicans and Obama budget plans.

Many Progressives are wary that the budget negotiation process the president announced yesterday could ultimately lead to a deal that does in fact yield ground on these structural issues. They point out correctly that, as long as there is a Republican-controlled House, any long-term deal would of necessity involve bad outcomes.

I agree with that concern. Luckily, I am about as likely to be reincarnated as a frog as the Republicans are to agree to increase taxes on the wealthy. This is the holy grail of Republican's policy world. It is, in fact, the principal raison d'etre of the party's existence.

That being the case, the odds of a true, long-term global budget deal this year are, I believe, very slim. In all likelihood that must await the next election where Democrats will regain control of the House, maintain the Senate and the White House.

The president's speech yesterday made that kind of electoral outcome much more likely. It also increased the odds that the country will actually get a long-term budget plan that simultaneously reduces our federal deficit and allows us to win the future.

Robert Creamer is a long-time political organizer and strategist, and author of the book, Stand Up Straight: How Progressives Can Win, available on Follow him on Twitter @rbcreamer.