Mitch Daniels' Lost Agenda: Compassionate Conservatism
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The Fiscal Times
May 26, 2011

So what would have been Gov. Mitch Daniels’s platform for slashing the deficit if he hadn’t decided against seeking the Republican presidential nomination? The mild mannered former Bush era White House budget director appeared on Wednesday at a fiscal summit in Washington just a few days after announcing that he wouldn’t run for president.  He pinned his decision to family reasons.

Because Daniels had so much success as governor in turning Indiana’s finances around and balancing the budget, it seemed like an obvious question to ask what a Daniels campaign fiscal agenda might have looked like.

“The guts of it would be to say that as a matter of arithmetic – not as a political philosophy, not as a commitment to any particular side—that if we’re going to preserve the American dream, and we can, we've got to do a few fairly straightforward things,” Daniels said. “And they need not hurt anyone; in fact they will save a lot of people, starting with preserving Medicare and Social Security for those [older Americans] in or anywhere near them today.”

“I say Medicare 2.0 and Social Security 2.0 so that those younger people will have something to rely on, too,” he added. “We ought to restructure them today to protect the most vulnerable, and to shift in a big way the available dollars to those who really need them or will need them. The rest of the federal government needs to be examined and reduced to an affordable level, and that includes looking at all of our defense commitments.”

"If you only weed the [tax code]
garden once in every 25 years it will be
a Washington you have a lot of
people running around planting weeds.”

Daniels arrived at the fiscal summit with a large bandage on his forehead that covered a huge gash he suffered when he was hit by a swinging door at a health club back in Indiana. He offered other observations during his appearance at the Peter G. Peterson Foundation second-annual Fiscal Summit:

  • Cutting spending is difficult and will prompt much grumbling and demagoguery by special interest groups, but “if you deliver results, you will not only survive but thrive.”
  • Imposing tough budget enforcement laws to force Congress and the White house  to adhere to long term spending reductions – much like the old Gramm-Rudman-Hollings law—“are very important but not always effective” because of loopholes and exceptions. Daniels said that some of the ideas now being kicked around to cap spending and automatically trigger across the board cuts when Congress veers from the path of deficit reduction are “blunt instruments” of “limited utility.’
  • Medicare, Medicaid and other costly entitlement programs that are the main drivers of the $1.5 trillion annual budget deficit must be reformed and scaled back, but without shredding the social safety net.
  • The federal tax code is a mess and needs to be shorn of many of its wasteful and unjustifiable tax breaks or tax expenditures. “If you only weed the [tax code] garden once in every 25 years it will be a mess,” but in Washington “you have a lot of people running around planting weeds.”

Daniels, in his second term as governor, had been courted by heavyweights in the GOP hoping to convince him to make the plunge into the presidential campaign. News reports circulated that former First Lady Laura Bush had made a personal appeal to Daniels’ wife, who reportedly was ambivalent about such a run. It also is no secret that many GOP power-brokers saw Daniels as the party’s most formidable challenge to President Barack Obama.

Last weekend, Daniels reluctantly announced that he wouldn’t be a candidate for the GOP presidential nomination because of opposition from his wife, Cheri, and their four daughters. “In the end, I was able to resolve every competing consideration but one -- the interests and wishes of my family," Daniels said in a statement emailed to supporters early Sunday morning. “If I have disappointed you, I will always be sorry.”

Washington Editor and D.C. Bureau Chief Eric Pianin is a veteran journalist who has covered the federal government, congressional budget and tax issues, and national politics. He spent over 25 years at The Washington Post.