Budget dilemma pits raising revenues vs. spending cuts

“We can’t deal with the deficit until we’re willing to get our arms around spending and have a strong economy,” Mr. Boehner said Wednesday, laying out an argument that top Republican congressional leaders immediately backed.

He called for leaving all of the 2001 and 2003 Bush tax cuts in place for two more years, and called on Congress to limit next year’s discretionary spending to the same level it was in 2008, before the stimulus and the Wall Street bailout bill passed.

He said that would come to $1.029 trillion, or nearly $100 billion less than Mr. Obama’s budget proposal to spend $1.128 trillion next year.

Still, Mr. Boehner would leave a lot of spending - entitlement programs such as Social Security and Medicare, as well as defense, homeland security and veterans funding - untouched, which means Congress would have the near-impossible task of squeezing $100 billion in savings out of the rest of the budget.

Judging by the polls, Mr. Obama should be getting the better of the argument.

A Newsweek survey taken at the end of August found voters strongly support more spending now to create jobs, rather than reducing the deficit, by a 57 percent to 37 percent margin. And asked what should happen to the Bush tax cuts for wealthier taxpayers, voters wanted them to expire, by a 52 percent to 38 percent margin.

But another poll, conducted by Ipsos Public Affairs, found some nuance in the tax question: 15 percent said let all the tax cuts expire, including for lower-income earners, while 31 percent said let only the higher-income tax cuts disappear, and 49 percent said extend them all.

Mr. Riedl said Republicans can strengthen their claim to a mandate from this year’s elections by offering more specific proposals.

“The mandate would be bigger the more specific their proposals are, and right now the Republicans have not offered much more than vague platitudes on how to rein in spending, with the exception of Paul Ryan’s plan,” he said.

Mr. Ryan, Wisconsin Republican, has offered a broad blueprint for changing Social Security and Medicare and holding down costs in those programs in order to bring the long-term budget into balance.

But Republican leaders have been reluctant to embrace the plan and have instead ducked questions about it.

Mr. Horney said there’s no way to say in advance what the right level of spending and taxes should be, but the discussion about how to bring them into balance is long overdue.

“At the end of the day, what budgeting is all about is determining what are the appropriate services and benefits provided by the government, given that we need revenues to pay for them,” he said.

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