Obama stands his ground on fiscal debates

By Jim Kuhnhenn

Associated Press

Published: Tuesday, Jan. 22 2013 11:23 a.m. MST

"It's a matter of how you interpret it," said Jared Bernstein, the former chief economist for Vice President Joe Biden. "If you believe the Republicans will make the debt ceiling crisis a quarterly event, then this is a bad outcome. The White House playbook is that there are now enough Republican grownups in the room they can hammer out deals."

House Speaker John Boehner, R-Ohio, set a hopeful tone, declaring that the inaugural was a chance to "renew the old appeal to better angels." On Tuesday, Sen. Mitch McConnell of Kentucky, the Senate's Republican leader, urged Congress and Obama to make spending and the debt their top priority and called for an overhaul of entitlement programs.

"It's nice to say, as the president did yesterday, that these programs free us to take the risks that make our country great," he said on the Senate floor. "But if we don't act to strengthen and protect them now, in a few years they simply won't be there in their current form."

During negotiations last month aimed at avoiding a combination of spending cuts and tax increases, Obama presented Boehner with a proposal that would have reduced spending on Medicare and other entitlement programs by $400 billion; reduced non-entitlement programs by $200 billion over 10 years; and lowered cost-of-living increases for Social Security recipients and other beneficiaries of government programs.

But Obama also wanted some increased spending and still wants more tax revenue through changes in the tax code that would force the rich to pay more, proposals Republicans reject.

Even an ally like Bernstein pointed out that when it comes to spending outside of defense and entitlements, Obama has an incompatible goal of reducing the budget as a share of the economy to the lowest levels since President Dwight Eisenhower's administration.

"It is very hard for me to square those tight budget constraints on the non-defense discretionary side of the budget and many of the aspirations I heard today," Bernstein said. "That said, I think they are exactly the right aspirations."

And there was little about finding common ground in Obama's speech.

"We cannot mistake absolutism for principle, or substitute spectacle for politics, or treat name-calling as reasoned debate," he said.

It was not meant as a self-critique.

Follow Jim Kuhnhenn on Twitter: http://twitter.com/jkuhnhenn

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