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Will Obama Go Big or Base on Budget?

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Federal budget plans are about much more than dollars and cents. The proposals provide a glimpse into the types of policies a leader favors and how much he or she is willing to risk to advance them.

Recently, two men have come forward with big proposals in an extremely risk-averse Washington. The president's budget, which is due to be released on Tuesday, will provide him with the opportunity to go big as well. For the country's sake he should use the platform to show that he is able to come up with big ideas that can draw in both sides of a divided government.

The four major elements of our federal budget are taxes, entitlements, defense and non-defense discretionary spending. House Ways and Means Committee Chairman Dave Camp, R-Mich., has started the conversation on taxes by releasing a plan to overhaul the current system. Defense Secretary Chuck Hagel has proposed a plan to streamline the military to deal with today's threats. Both of those big ideas have elements that are unpopular with each party. Rather than weakening their arguments, this opposition is a positive development. It proves that they are willing to take a political risk for the greater overall good.

With non-defense discretionary spending already at its lowest levels as a percentage of GDP since the 1960s, the only element thus far unaddressed are entitlements. It just so happens that these are the biggest drivers of our long-term debt. Now is the optimum time for Obama to catch some of Camp's and Hagel's boldness and comprehensively address our nation's debt including entitlement reform.

The president's second term hasn't amounted to much so far. The jury is still out on the long-term policy impact of Obamacare, the major legislative accomplishment of his first term. What isn't in doubt is that the way in which the health care overhaul was passed served to strain our nation's political discourse.

Since then, Democrats and Republicans have managed to agree on several measures, such as the most recent debt ceiling bill, to avert an economic downturn. Preventing disaster doesn't have to be the only thing that both sides agree upon. As the chief executive, it is incumbent upon Obama to reach out first and say that he is willing to take a risk to improve the nation's long-term economic stability.

Republicans have indicated a willingness to work on entitlement reform. Obama should do all he can to engage. Doing it right will require appealing to the political opposition, which hasn't been the president's strong suit. It will also necessitate fulfilling a campaign promise to unite, and to show that "we remain more than a collection of red states and blue states. We are and forever will be the United States of America." In his second term the president has been an able orator, but a lackluster operator. He is running out of time to change that impression.

Unless he addresses the fiscal implications of the health care law and other entitlements, they will either prove to be an unbearable burden driving future deficits or get dismantled by future governments. Therefore enacting comprehensive fiscal reform, including cost saving alterations to Obamacare, would not only be a significant accomplishment in its own right, but also preserve his largest policy achievement to date.

So now the ball is in Obama's court. Is he going to present a big plan that tries to tackle the serious long-term fiscal problems the nation faces? Or will he trot out a proposal that panders to his liberal base, whom he recently chided at a Democratic Governors Association fundraiser for not paying attention to midterm elections because they weren't "sexy enough?" For the sake of the nation, here's hoping it's the former.

Hon. Mark R. Kennedy (@HonMarkKennedy) leads George Washington University's Graduate School of Political Management and is Chairman of the Economic Club of Minnesota. He previously served three terms in the U.S. House of Representatives and was Senior Vice President and Treasurer of Federated Department Stores (now Macy's).