Tuesday, January 26, 2010

Obama Decides to Validate Republican Criticisms and Embrace McCain-Style Spending Freeze

As there is more talk today of President Obama's expected plans to announce an overall spending freeze on discretionary items during his State of the Union Address tomorrow, this video surfaces (h/t Ezra Klein):

That was then candidate Obama rejecting Sen. John McCain's call for an "across the board" spending freeze on all programs except those that are military in nature. Now the Obama Administration is going to argue that what they are proposing is not the same as McCain's proposal during the campaign. The difference being that McCain would have frozen ALL spending on non-military programs while Obama is apparently wanting to increase some programs and cut others; the net result of which would be an overall freeze of spending (on items that are not military in nature of course).

Even if this is the case, the Obama Administration has really backed themselves into a corner not only politically, but on the various policies that they have been trying to pass since Obama took office just over a year ago. Not only that, but if you thought Obama was angering his political base on the issue of health care reform, then there is every reason for them to be enraged now. Not only is Obama embracing Republican thinking on spending cuts, but he is literally embracing the ideas of the candidate that he defeated and that the voters rejected in the 2008 election. Paul Krugman:

A spending freeze? That’s the brilliant response of the Obama team to their first serious political setback?

It’s appalling on every level.

It’s bad economics, depressing demand when the economy is still suffering from mass unemployment. Jonathan Zasloff writes that Obama seems to have decided to fire Tim Geithner and replace him with “the rotting corpse of Andrew Mellon” (Mellon was Herbert Hoover’s Treasury Secretary, who according to Hoover told him to “liquidate the workers, liquidate the farmers, purge the rottenness”.)


A correspondent writes, “I feel like an idiot for supporting this guy.”

With much emphasis on the actual "freezing" of spending, it is also necessary to take a look at what will not be frozen: military spending. In fact, military spending is rarely even considered for cuts even when there is vast evidence to support the notion that U.S. military spending is off the charts. Glenn Greenwald:

In sum, as we cite our debtor status to freeze funding for things such as "air traffic control, farm subsidies, education, nutrition and national parks" -- all programs included in Obama's spending freeze -- our military and other "security-related" spending habits become more bloated every year, completely shielded from any constraints or reality. This, despite the fact that it is virtually impossible for the U.S. to make meaningful progress in debt reduction without serious reductions in our military programs.


The clear fact is that, no matter how severe are our budgetary constraints, military spending and all so-called "security-related programs" are off-limits for any freezes, let alone decreases. Moreover, the modest spending freeze to be announced by Obama tomorrow is just the start; the Washington consensus has solidified and is clearly gearing up for major cuts in Social Security, Medicare and Medicaid, with the dirty work to be done by an independent "deficit commission."

So, in short, this move by the Administration makes little sense and could cause quite a rift with progressive elements that would want to see strong progressive challengers to Obama in 2010 and 2012.

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