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Joe Peyronnin

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Obama's Jobs Pivot

Posted: 08/02/11 07:14 PM ET

Senate Republican Leader Mitch McConnell of Kentucky has said that making President Barack Obama a one-term president is his top priority. Now that the president has signed the debt-ceiling bill that was shaped in part by Senator McConnell it appears that the senator has outmaneuvered the president and left him badly damaged.

Few members of Congress are happy with the final measure. Moreover, there were no winners following weeks of acrimonious and frustrating debate. According to polls the president's job approval has taken a beating. But Republicans have taken a bigger hit. Meanwhile, the global perception of America has been further diminished.

President Obama found himself in a difficult position following the 2010 midterm election. Republicans won a majority in the House of Representatives. They also gained enough seats in the Senate to head off a cloture vote that would end a GOP filibuster. Even more problematic for the president was the election of the fiscally conservative Tea Party faction of the Republican Party, whose sole focus is to "get government spending under control."

The president decided late last year to continue the Bush tax cuts for the wealthiest Americans in exchange for extension of much needed unemployment benefits. He also decided not to take on the debt ceiling at that time because of Republican resistance, even though Democrats still controlled Congress. That decision ended up giving Republicans enormous leverage and they would come to use it to their advantage.

Earlier this year President Obama said he wanted a clean debt-ceiling bill but the Republicans instead demanded linking budget cuts to its passage. The president then took the position that budget reform would have to be balanced between spending cuts and a smaller amount of increased revenues from the richest Americans and businesses by closing tax loopholes. He even said he would consider finding future savings in cherished social programs, a decision which drew ire from progressive Democrats.

As the August 2 deadline neared the partisan rhetoric heated up. Many experts predicted that failure to pass a debt-ceiling bill would have disastrous consequences on the U.S. and global economies. And while Americans would blame everyone in Washington for the fallout, most of the blame would be directed at President Obama. For the good of the country and his political standing the president had to have a deal. In the end he had to forego his revenue demands and accept a "cuts only" budget bill.

The good news for the president is that he got the debt ceiling extended until 2013 and he avoided cuts in entitlement programs. However, the budget bill calls for $1 trillion in cuts over 10 years, and another $1.7 trillion more to be identified by a special committee of Congress, equally staffed by Democrats and Republicans, later this year. And Senator McConnell has said none of his appointees will vote to raise taxes. If the committee fails to come to an acceptable proposal automatic cuts in domestic and defense programs are triggered. Of course they won't come to an agreement!

With the U.S. economy struggling and unemployment stuck at an unacceptable level, Republicans shifted the debate to government spending. They blamed President Obama for increasing the national debt by 47% since he has been in office. They do not mention that the nation's debt increased by 200% during President Ronald Reagan's two terms, and more than 100% in President George W. Bush's term. And much of today's deficit is due to President Bush; two wars, an unfunded prescription drug bill and his tax cuts.

Republicans fiercely protect the Bush tax cuts and fight to radically cut the size of government and eliminate many corporate regulations. This is their jobs plan, even though the Bush tax cuts have not added jobs. And GOP leaders have effectively used every bit of their leverage to get their way.

Speaking at the White House following the Senate vote, President Obama pivoted from debt to jobs saying he would take steps to get the U.S. economy back on track. He then called on Congress to extend middle class tax cuts and unemployment benefits, to pass pending trade deals and he again called for rebuilding the nation's crumbling infrastructure. "There is no reason for Congress not to send me these bills right a way," the president said. But by putting the onus to act on Congress the president may again be playing into Senator McConnell's hands.

Mr. President, why would you think that Republicans, who control the House and can prevent cloture in the Senate, will ever do anything that may help get you re-elected? Job number one for you is job creation -- please take the lead.


 

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