Republican House Speaker John Boehner calls President Obama’s new budget “irresponsible.” A New York Times headline calls it a “populist wish list.” But it’s neither of those things. The White House’s fiscal proposal is a cautious foray out of the president’s reflexive “compromise” mode.
Unfortunately, it also repeats and reinforces the deficit-reduction rhetoric which has misdirected the political debate for the last four years. It is limited in its scope and overly cautious in its sweep.
The nation is still in an economic crisis – a crisis of jobs, social mobility, wages and growth. We need to start focusing more on the lives that are being devastated by this crisis, and less on the artificial crisis of “debt reduction.” President Obama’s budget does too little, both rhetorically and economically, to address this crisis. At the same time, it contains changes that demonstrate populism’s growing power and influence, and it’s good to see that the President finally recognizes that the GOP will reject anything he proposes – even their own ideas.
How should the independent left respond? Unaligned populists and progressives must not lose sight of the need for a more transformative economic vision. The Democratic Party, and especially President Obama’s wing of it, must not define the leftmost boundary of political debate. If we are to see a “dream budget,” we need to dream bigger than this.
But it’s self-defeating for the left to ignore the victories that come its way, whether small or large. We should acknowledge these growing signs of populist influence and capitalize upon them as we work to effect change that is real and not merely rhetorical.
Politico reports that administration officials describe this as “a budget (the president) would present in an ideal world.” That’s probably right, but that doesn’t mean it’s strong enough. In fact, many of its provisions would have been at home in Republican budgets of previous decades. The fact that they’re labeled “liberal” or “populist” today reflects the rightward shift in elite discourse – a shift that must be reversed.
On issue after issue, this budget is an improvement from previous years, and on issue after issue it falls short.
A case in point: The president’s proposal to expand the Earned Income Tax Credit for households without children, together with an expansion of child- and dependent-care tax credits, is clearly a good thing for suffering lower- and middle-income Americans. But there is no proposal for addressing the source of that suffering, for healing an economy that is increasingly skewed in favor of the wealthy as most Americans fall further behind. Measures like these won’t save the middle class – or the American economy – unless we address the top 0.01 percent’s hijacking of our national income.
The $302 billion earmarked for infrastructure repair is a good thing. But it’s less than one-tenth of the $3.6 trillion in repairs that the American Society of Civil Engineers tell us is needed in the next six years.
Similarly, the “Buffett rule” is a step in the right direction. But a society in which a billionaire like Warren Buffett pays the same tax rate as his secretary is a still society with an un-progressive and unjust system of taxation. We shouldn’t just bring billionaires’ taxes up to their secretaries’ level. We should double them.
The Buffett rule, and the President’s other proposed changes in high-earner taxation, could make sense as part of a short-term compromise (were such a thing possible with today’s Reublican Party). But they fall far short as an “ideal world” solution.
The End of Austerity?
It’s disappointing at best to hear the White House say that these new revenues are earmarked for deficit reduction, especially given the White House sources who said that this budget would mark “the end of the era of austerity” for President Obama.
Apparently not. Deficit figures have plunged, but wages remain stagnant (at best) and long-term unemployment figures are devastating. This budget is a hypothetical exercise. As such, it’s also a statement of values and priorities – and our highest priority should be millions of struggling human beings, not tweaking better percentages out of already-improving balance sheet numbers.
When it comes to corporate taxation, there’s no question that the system is broken and needs to be fixed. But to do so in a way that would be “revenue neutral,” as the president has promised to do, is a tragic mistake at this point in our economic history – a time when tens of millions of Americans are struggling, corporate profits are at record highs, and actual corporate tax rates are at or near record lows.
It’s worth celebrating the decision to drop the “chained CPI” cut to Social Security benefits (although the White House confirms the president still supports it in principle and would be willing to include it in a “grand bargain”).
But, as Michael Hiltzik of the Los Angeles Times points out, the President’s budget also includes a gratuitous cut to Social Security disability benefits. This move would link Social Security to general budget needs for the first time, while reinforcing the false austerity-era notion that entitlement recipients are somehow “undeserving.”
Republican Rep. Paul Ryan says that President Obama’s new budget is a “campaign brochure.” He’s right about that – and that isn’t a bad thing. While the White House may have not produced a “populist wish list,” that’s what the public clearly wants. As the Populist Majority website documents, voters across the political spectrum are seeking “left” solutions. Some examples:
- 73 percent say they are dissatisfied with the current state of the economy.
- 72 percent think the state of our economy is “not so good” or “poor.”
- 65 percent think the recovery is weak.
- 81 percent are concerned that their income isn’t keeping up with the cost of living. (They’re right.)
- 43 percent say employment or “the economy” is our biggest problem.
This budget doesn’t do nearly enough for the Americans – Democrats, Republicans, and independents – who hold these views. But it’s a substantial improvement over previous years, and that’s an auspicious sign of the populist movement’s growing influence.
It’s also why victories like the chained CPI shouldn’t be taken lightly. Sure, the president could still include it in some future deal. But it just became less likely, thanks to a lot of hard work on the left. If that keeps millions of disabled and older Americans from seeing a $50 or $80 or $100 cut in their monthly benefit someday, that’s a victory worth savoring – and building upon.