President Obama’s strategy for governing during his second term now seems pretty clear. It is exactly the same as his strategy for winning his second term: Get out in front and define the position of his adversaries early, in the simplest and most unfavorable terms possible, and stick to the message until he wins. Whether it is the right outcome for the country would seem to be a secondary consideration.
It was the same strategy on the “fiscal cliff.” It was never about spending, fiscal responsibility or any of the other factors that led to it. It was all about cutting taxes on the middle class. The president became the champion of the 98 percent of George W. Bush’s tax rates that Democrats used to rail against, and he defined Republicans as the party willing to hold the middle class hostage to the selfishness of the greedy rich in the 2 percent. He defined the issues early and stuck to the script. As in the election, he won — sort of.
He passed up the chance to negotiate, in good faith, a grand bargain for the good of the country. House Speaker John A. Boehner was willing to do that, at some obvious political risk. The president was not. In the end, he left the negotiating to Vice President Joseph R. Biden Jr. and nothing important was accomplished. Not even the “chained CPI” reform Republicans proposed and the president had endorsed could get done. It was a deal no one could be proud of. Then, Mr. Obama left for Hawaii to play golf.
Now the game is beginning again, this time over the debt ceiling. The president has gotten out in front again and defined the issue in terms of whether Congress should pay the tab for a bill they’ve already racked up. It isn’t his bill, of course, and it is not about him. It is all about his adversaries. Moreover, unsurprisingly, he has said he will not negotiate. Nevertheless, it is not supposed to work this way. Elected officials are supposed to govern, working together to confront the nation’s threats and challenges. That process is not supposed to be a perpetual contest to best each other. Unfortunately, it is now pretty clear this is the way it is going to be, so everyone else is going to have to adjust.
In the case of the debt ceiling, what the president is proposing is this: A Congress that hasn’t been able to agree to a budget as required by law for the last three fiscal years should get a blank check to borrow more money, and lots of it.
Authorizing more debt for any entity that cannot even write a budget is, not to put too fancy a term on it, just plain reckless. Every American who has ever borrowed money knows that. The federal government does not have enough income to pay its ongoing expenses and the interest on its debt, so it does not even meet the standards ordinary Americans have to meet to get a mortgage. Would a bank officer just shrug his shoulders and give someone a loan because he has spent the money already? Dream on.
This is the critical part: The government is not borrowing money on its own credit. It is borrowing on the credit of the people of the United States — the same people who have to show they have the income to pay their debts before they can borrow more. After all, it is they who will have to pay the interest on the president’s debt, fiscal year after fiscal year, in perpetuity. How much debt is that? Under the president’s proposed budget, the interest alone is projected to be more than $800 billion a year in 10 years. That is the cost of the interest on money that will have been spent by this president and his friends in Congress. That is more than the defense of the Free World costs today. It is more money than was authorized by TARP, and far more than was actually spent on it. For all that money, what will the American people get? Absolutely nothing. It will make bankers richer, but everyone else will be poorer.
The president and his allies in Congress must come up with a framework for authorizing the debt the government actually needs to function for the remainder of Mr. Obama’s term — once they decide what that actually is. Existing law, the Congressional Budget Act of 1974, already requires Congress to do that. It is really simple: All Congress has to do is follow the law, just like the ordinary Americans whose money they are spending, must do every day. Pass a budget, get borrowing authority and pay the bills — in exactly that order. The Democratic Senate, which has not approved a budget in more than three years, would have to do its job. The ball is in its court.
They have the numbers already in the president’s budget submission. The House and Senate, in a remarkable display of bipartisan consensus, unanimously rejected the president’s numbers last year, which only means they have work to do. If they do not like the president’s deficits (who does?), then they have to decide what they do like. The debt the president wants is just the sum of those deficits.
It can be done. Under the law, Congress has until April 15 to pass a budget, the same day Americans have to pay the taxes that fund the interest on the debt. If Congress expects ordinary Americans to meet their statutory deadline, it is not too much to expect our distinguished senators to meet theirs.
It takes a little while to fill out your tax return, and it will take a little while for Congress to pass a budget. The American people will understand if Congress gives the Treasury temporary borrowing authority that expires on April 15. Yet there must be no more borrowing of money after that without a budget. This time, the game should be different. It will be a contest between the American people and their president. Play ball.
Warren L. Dean Jr. practices law in Washington, D.C, and is an adjunct professor of law at Georgetown University Law Center.
By Douglas Holtz-Eakin
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