It’s only on the New York Times’ blog (not sure if these things ever make their way into the paper), but thanks to David Firestone for taking the right lesson from the Obama Administration’s proud boasts in favor of spending cuts:
“Do not buy into the b.s. that you hear about spending and fiscal constraint with regard to this administration,” (White House Press Secretary Jay Carney) demanded. “I think doing so is a sign of sloth and laziness.”
This trumpet blast would seem to indicate that Mr. Carney has bought into a standard Republican line: restraint is good and spending is bad, even when government dollars are desperately needed by a struggling economy. When Mitt Romney and other Republicans claim the president is a big spender (as they do every waking minute), the administration’s first instinct is to say they’re wrong on the facts, not that they’re wrong on the principle.
Firestone goes on to explain that Republicans in Congress have “constrained Obama’s desire to spend more,” but that’s not quite right. Federal fiscal policy became a drag on the economy in mid-2010, before Republicans took power in the House. It’s true that we had spending cuts in the FY2011 budget and spending caps in the 2012-2021 budgets due to Republican demands. It’s also true that the Administration is proud of that. As Firestone notes, the investment in discretionary spending has moved from 5% of GDP to less than 2%, and that includes the kinds of programs – education, housing assistance, transportation, job training – that enables upward mobility. And he adds that a time of economic fragility and headwinds at all corners actually needs some stimulus if you’re going to reduce the unemployment rate. “Apparently, though, you have to leave the administration to favor a stimulus program, because everyone there would rather talk about austerity and restraint. Just like Mitt Romney,” Firestone concludes.
It’s refreshing to see a traditional media reporter taking this approach. And it will be important for the coming battles over the fiscal cliff. Because you have this strange situation of Republicans, while admittedly defending tax cuts for the rich and defense contractor giveaways, using the language of Keynesianism, while Democrats are using the opposite.
In an interview with POLITICO, Reid said he was open to a compromise that would salvage about four-fifths of the Bush-era tax cuts. But absent some concession on revenues, the $110 billion in spending cuts ordered by the debt agreement last August would go into effect.
“I am not going to back off the sequestration,” Reid said. “That’s the law we passed. We did it because it wouldn’t make things easy for us. It made it so we would have to do something. And if we didn’t, these cuts would kick in.”
“To now see the Republicans scrambling to do away with the cuts to defense, I will not accept that,” Reid said. “My people — in the state of Nevada and I think the country — have had enough of whacking all the programs. We’ve cut them to a bare bone, and defense is going to have to bear their share of the burden.”
It’s not that I disagree with Reid on the defense cuts – I think they’re more than achievable. But the rhetorical shift is notable, for starters, and also, Reid is happy to make a deal to trade revenues for defense spending. Overall, there’s nobody arguing for the position that we need a bounce-back in the economy and that can be achieved by running a higher deficit.