GOP, Obama Draw Battle Lines Over Budget

President Barack Obama’s State of the Union message proposed more than a dozen new spending programs despite spiraling federal indebtedness, revealing a vast gulf between Democrats and Republicans over the urgency of U.S. solvency.

The sharp divergence also suggests that the two sides will fight a running battle over the austerity issue all the way through the 2012 presidential election.

While leaving it up to Congress to be “responsible” and to “make the hard choices now to rein in our deficits,” the president called for new spending on roads, bridges, high-speed rail, the Internet, and education.

That left his conservative critics almost marveling at a president who sees the state of the country in starkly different terms than do grass-roots conservatives.

“I was very disappointed in that,” says GOP Rep. Jim Jordan, chairman of the Republican Study Committee, in an exclusive Newsmax.TV interview. “This is not going to get us where we need to go and put us back on the right fiscal path.”

A report Wednesday from the Congressional Budget Office (CBO), which the administration has relied on so often to provide rosy projections about the flood of federal red ink, supported the dire GOP view, delivering a rat-tat-tat of ominous findings:

• The budget deficit expanded from a record $1.3 trillion last fiscal year to a record $1.5 trillion in the current budget year.
• At current spending levels, the national debt that represented 40 percent of GDP in 2008 will rise to 70 percent by the end of 2011, according to TheHill.com. That figure does not include state and local debt and obligations, however.
• The CBO director, Douglas Elmendorf, wrote that Congress must raise taxes or cut spending “to prevent debt from becoming unsupportable.”
• The CBO projects continued chronic high unemployment. The jobless rate would drop to 9.2 percent by September and still would be over 8 percent by the fall of 2012.

If any of that was particularly alarming to the president or Democrats on Tuesday night, however, there was little evidence of it.

Obama left Washington on Wednesday morning to visit a high-tech energy firm in swing-state Wisconsin, where he made jokes about the Green Bay Packers football rivalry with the Chicago Bears and declared: “We need to win the future.”

By couching his renewed stimulus plans in bipartisan rhetoric, the president did not avoid brickbats from both Rep. Paul Ryan, who delivered the official GOP response, and Rep. Michele Bachmann of the House Tea Party Caucus.

“We believe the days of business as usual must come to an end,” Ryan warned. “We hold to a couple of simple convictions: Endless borrowing is not a strategy. Spending cuts have to come first . . . Our nation is approaching a tipping point. We are at a moment where, if government's growth is left unchecked and unchallenged, America's best century will be considered our past century.”

“Each day going forward, we must work hard to dismantle the massive government expansion that has happened over the past two years,” Bachmann said.

In his speech, the president did call for a five-year freeze in discretionary federal spending. Fox News commentator Britt Hume remarked that his move would diminish the deficit by a “minuscule” amount.

And the president’s refusal to call for the adjustments to entitlement programs that his deficit commission recently embraced suggests a familiar strategy: He will let Republicans propose controversial cuts, and suffer the political consequences.

“That is the same old game that has been played in this town for a very long time,” Hume remarked Wednesday.

That Bachmann and Ryan agree on the urgency of sharply reducing government expenditures suggests the battle lines between Republicans and the administration have now been drawn in the run up to 2012. The president will present himself as a centrist while protecting the progressive agenda he hopes to institutionalize as bureaucratic rule-making on his major initiatives continues. And Republicans will move forward to show they are serious about reducing the deficit.

The latest move on the political chessboard came with the announcement that four leading members of the Republican Study Committee have introduced legislation that would direct the U.S. Treasury to avert any default if the debt ceiling isn’t raised to accommodate additional federal spending. It will do so by requiring the department to pay principal and interest due on the debt before making any other “investments.”

The move is designed to neutralize the alarms over a possible default, which Jordan called “a pitiful scare tactic.”

Some polls suggest the Obama strategy of calling for cuts while pursuing business as usual in Washington will work.

Voters overwhelmingly want a balanced budget, but when it comes to specific programs, they consistently appear allergic to actual cuts.

But Republicans appear willing to bet that, with the ongoing sluggishness of the recovery and high-profile European crises, the political calculus has changed.

A new Rasmussen poll supports that notion, showing that an overwhelming 68 percent of likely voters would prefer a smaller government with fewer services, if it led to lower taxes.

“Here’s the good news,” Jordan tells Newsmax. “In my time in public office, I have never seen the American people more ready, more receptive to the tough love measures that need to happen to fix our country, to put us back on fiscal path that’s actually sustainable.

“The American people understand it,” he says. “The question is whether the political class will have the courage to rise to the standards of the American people . . . and do what needs to be done.”