---------------------
By ROSS DOUTHAT
NY Times Op-Ed Columnist
Published: September 11, 2011
A week after President Obama took the oath of office, Alice Rivlin, budget chief to President Bill Clinton, testified before a Congress that was about to consider sweeping stimulus legislation. In her remarks, Rivlin voiced her support for a swift and substantial federal intervention to prop up the sagging economy. But she offered lawmakers three warnings as well.
The first warning was about the design of the stimulus. The ideal anti-recession package, Rivlin told Congress, would include aid to state governments, extended unemployment benefits, money for genuinely “shovel ready” projects and a payroll tax holiday. But she urged Congress to resist the temptation to combine these kinds of short-term recession-fighting measures with a larger and more costly investment in energy, education and infrastructure. Trying to rush a long-term spending package through in an atmosphere of crisis, she cautioned, would only guarantee that its contents would be poorly designed, and much of its spending wasted.
The second warning was about setting expectations. Given the nature of the financial crisis and the nasty overhang of debt it left behind, any recovery would probably be slow even with a stimulus bill. Policy makers “should be skeptical of all forecasts,” she told Congress, “and especially conscious of the risk that things may continue to go worse than expected.”
The third warning was about how to handle the problem of deficits, which already shadowed the stimulus debate. “We do not have the luxury of waiting until the economy recovers before taking actions to bring down projected future deficits,” Rivlin said. Instead, she urged Congress to take action “this year” on entitlement spending, and to prioritize Medicare reforms over a more comprehensive health care overhaul.
With these three warnings, Rivlin anticipated everything that the Obama White House and the Democratic Congress would do wrong over the next two years.
First, instead of passing a targeted antirecession package, Congressional Democrats crammed the stimulus bill with spending on everything from Head Start and Pell Grants to high-speed rail and renewable-energy projects. The hope was that the legislation would do more than just kickstart a recovery: It would lay a new foundation for the economy, with an electric car in every garage and a Solyndra solar panel on every roof. The result, predictably, was a bill that looked less like a temporary exercise in crisis management and more like the Democratic Party’s permanent wish list.
Second, instead of emphasizing the severity of the recession, the White House offered sunny — and, as it turned out, wildly mistaken — projections about how swiftly the stimulus would bring down the unemployment rate. Even once it became clear that the recovery wasn’t happening nearly as quickly as promised, the administration stuck to its Pollyannaish script, sending the president and the vice president out on an embarrassing “recovery summer” tour in 2010 and repeatedly projecting economic growth that failed to materialize.
Finally, instead of pivoting from the Recovery Act to deficits and entitlement reform, the Democratic majority spent all of its post-stimulus political capital trying to push both a costly new health care entitlement and a cap-and-trade bill through Congress. Both policies were advertised, intermittently, as deficit reduction, but neither came close to addressing the real long-term drivers of the nation’s debt. And they left Congressional Democrats to campaign for re-election in 2010 as the custodians of record deficits as well as sky-high unemployment.
Now, nearly three years after Rivlin’s warnings went unheeded, President Obama has groped his way to an agenda that looks more like what she originally recommended. His speech to Congress last week suggested that he intends to campaign for re-election on what should have been the blueprint for his first four years in office: a short-term stimulus highlighted by a payroll tax cut, a medium-term push to overhaul the tax code and a plan for long-term entitlement reform.
To Republicans, this agenda holds out the possibility that a second Obama term might feature more opportunities for compromise and common ground. But to voters pondering whether to make that second term happen, it amounts to a request for a presidential do-over — a tacit admission that the White House’s first-term agenda has been less than successful, and a plea for a second chance to get things right.
If the answer to that plea turns out to be “no,” then President Obama’s political epitaph should be taken from the Victorian verse of Dante Gabriel Rossetti:
“Look in my face; my name is Might-have-been; I am also called No-more, Too-late, Farewell.”
No comments:
Post a Comment