About the Republican request for a balanced approach

Ezra Klein posted this today

This is a very sharp point by Josh Barro:

The Republicans’ main problem in this negotiation is that they know President Barack Obama will not agree to cut in the area they want to cut: aid to the poor. The signal Obama has sent is that he is willing to make a deal that cuts old-age entitlements, meaning Medicare and Social Security, and Republicans are internally conflicted over those programs.

He’s right. Think back to Mitt Romney’s proposed budget. Medicare and Social Security were held harmless for at least 10 years. Defense spending got a lift. PBS and the National Endowment for the Arts were on the table, but they cost so little it hardly mattered.

And there is the Ryan budget problem which remains the basic Republican budget outline.  It is what they ran on.

These are, however, classes of cuts the White House won’t even consider. A year ago, they were open to modest cuts in Medicaid, but after the Supreme Court’s health-care decision, even that door has shut. As for discretionary spending cuts, so many of those were made in 2011, there’s just not much left to do.

That leaves Medicare and Social Security. It’s possible that the negotiators will enact a backdoor, but significant, cut to Social Security by changing the government’s measure of inflation. But they’re not going to come at Social Security from the front. It’s too politically potent. Even Ryan’s budget left Social Security alone.

As for Medicare, as Barro says, if “Republicans ask for near-term Medicare cuts, that will mean reversing a position that is popular with a core constituency (old white people) and giving up a cudgel that they feel they have used effectively to beat up the president since 2009.” It’s a pickle.

In addition, as Steve Benen on the Rachel Maddow blog reminds us, the President has already offered spending cuts, of about 1.7 trillion over 10 years.

The White House keeps saying it wants a ‘balanced approach’ but this offer is completely unbalanced and unrealistic,” a Capitol Hill Republican said yesterday. “It calls for $1.6 trillion in tax hikes — all of that upfront — in exchange for only $400 billion in spending cuts that come later.”

Let’s put aside, for now, the irony of hearing Republicans talking about “balanced” debt-reduction plans. Instead, the importance of complaints like these is that they overlook everything that happened a year ago. Jonathan Cohn had a good piece on this.

…As part of the 2011 Budget Control Act, Obama agreed to spending  reductions of about $1.5 trillion over the next ten years. If you count  the interest, the savings is actually $1.7 trillion. Boehner should have  no problem remembering the details of that deal: As Greg Sargent points out, Boehner at the time actually gloated about the fact that the deal was “all spending cuts.”

And now, with this latest offer, Obama is proposing yet more spending  reductions, to the tune of several hundred billion dollars. Add it up  and it’s more than $2 trillion in spending cuts Obama has either signed  into law or is endorsing now. That’s obviously greater than the $1.6 trillion in new tax revenue he’s seeking. (And that doesn’t even take into account automatic cuts  from the 2011 budget sequester, which Obama has proposed to defer, or  savings from ending the wars in Afghanistan and Iraq.)

I can understand the temptation to block 2011 from memory, but what transpired is clearly relevant to the current debate. Obama wanted a “balanced” approach last year — some cuts, some new revenue — but didn’t get it. Instead, faced with the prospect of Republicans crashing the economy on purpose, the president accepted a deal with a whole lot of spending cuts.

How much new tax revenue came as the result of last year’s deal? Zero. The entire package came in the form of spending reductions and savings.

So with the new tax revenues and the already proposed budget cuts, President Obama is offering exactly what the Republicans keep asking for:  a balanced approach.  I’m not sure what they are waiting for.  Senator Harry Reid is mystified and so am I.

We need a comprehensive solution that lasts for a couple of years at a minimum because this non-economist doesn’t think the economy will improve as long as we seem to be in a continuous a budget or debt ceiling crisis.

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