Obama's Big Budget Battle: There Will Be Blood
Policy + Politics

Obama's Big Budget Battle: There Will Be Blood

iStockphoto/The Fiscal Times

Time is supposed to heal all wounds, but the battle between President Obama and GOP lawmakers has only grown bloodier over the past four years.

Obama gave a speech Wednesday claiming that some Republicans “privately agree” with his economic plans, but these unnamed Capitol Hill denizens have been bullied into silence. The other Republicans, the president said, callously believe that income “inequality is both inevitable and just.”

Ahead of the next round of dysfunctional budget talks that could crush the economy, those words were a declaration of war, rather than an olive branch. Following the president’s remarks, Rep. Darrell Issa (R-CA) captured the mood of the GOP by tweeting: “Zero jobs created from Obama’s speeches.”

By Oct. 1, the White House and Congress must hash out a 2014 budget, or the government shuts down. At roughly the same time, these two feuding parties must raise the $16 trillion-plus debt ceiling, or risk a historic default. This requires either a compromise between Obama and congressional Republicans, a temporary stay of execution, or one side beating the other into total submission.

Yet there is alarmingly little sense of urgency as Congress prepares to depart for a month long vacation in August. When lawmakers return in September, there will be only a handful of legislative days left to work out an agreement to avert the potential fiscal disaster. Instead of lining up meetings to lay the foundation for an agreement, the administration and congressional Republicans are content to talk past one-another.

When the country last wrestled over these issues in 2011, the recovery stalled, consumer confidence plunged, and the economy seemed to be on the verge of lurching back into recession. On Wednesday, the president called it a “fiasco” that “we can’t afford to repeat.”

Neither side is hedging their rhetoric. Both are speaking in the kinds of absolutes that used in a bitter political campaign. Public opinion has yet to pressure the president and congressional Republicans to compromise. Obama’s approval rating stands at a less than spectacular 44.8 percent, according to an average of polls by Real Clear Politics. Congress’ favorability is a dismal 15.2 percent.

Almost a year after his reelection, Obama has shown no desire to compromise on his principle that government programs can help the middle class. This makes it extremely hard to see how the president could meet Republican demands that discretionary spending be cut further and that Obamacare—which could extend health insurance to more than 20 million Americans—gets disowned and abandoned.

House Speaker John Boehner (R-OH) said on Sunday that his key metric for success would be votes to overturn the president’s agenda, not new measures that cement Obama’s legacy.

“We should not be judged on how many new laws we create,” Boehner told CBS News. “We ought to be judged on how many laws that we repeal. We've got more laws than the administration could ever enforce.”

There have been recent glimmers of bipartisanship—such as the deal in the Senate on immigration and the confirmation of Obama’s nominees to run agencies including the Environmental Protection Agency, the Labor Department, and the Consumer Financial Protection Bureau.

But none of that goodwill extends to the federal balance sheet, a point that several Republicans have repeated over the past month. Obama already received a tax rate hike on wealthier Americans earlier this year with the fiscal cliff deal. Even though the agreement protected about 99 percent of the country from higher income taxes as rates set in 2001 and 2003 were set to expire, House Republicans are determined not to yield a penny more.

Obama’s 2014 budget proposal would raise another $1 trillion over 10 years, about half of which would come from capping tax breaks on families with incomes above $223,050.

House Republicans passed a budget that leaves revenue levels unchanged, while removing all expenditures for Obamacare and trimming non-defense discretionary spending in order to generate a surplus by 2023.

In the appropriations process, the House is voting to butcher programs that Obama supports. A House subcommittee proposed on Tuesday to cut the EPA budget by 34 percent and remove its newly announced regulations on carbon emissions. The Fish and Wildlife Service would lose 27 percent of its funding, while the National Endowments for the Arts would be halved.

Some GOP lawmakers claim to be the victims of Obama’s bully pulpit, portrayed as villains instead of a legitimate branch of the government.

“The president is flying around the country today giving another one of those same stale speeches that he’s given over and over again,” vented Rep. Steve Scalise (R-LA). “But instead of flying around the country, he should park Air Force One and sit down and talk to our leaders in Congress to work out a resolution on the budget, government and on the debt ceiling. But he doesn’t want to do that. He wants to play politics.”

But House Republicans have yet to show much flexibility on the budget, so it’s not clear what Obama would gain from abandoning his public outreach.

Boehner has largely surrendered control of his caucus to several dozen of its most conservative members who talked on Wednesday about how they  see the budget and debt ceiling playing out.

Their chief demand for any debt and budget agreement is the defunding of Obamacare, the 2010 law that the administration has struggled to implement, having delayed by one year the start of an employer coverage mandate that supposed to begin in 2014.

“What we’re suggesting here is that we agree with the President that he cannot get it implemented on time and they will not make the deadlines,” said Rep. Tim Huelskamp (R-KS). “And what we’re suggesting here is that we fund the remainder of the government.”

Rep. Raul Labrador (R-ID) said that Republicans do not wish to shut down the government, saying the fault rests entirely with an Obama administration that refuses to cut spending as much as GOP lawmakers would like.

“If the government is shut down, it will be because the other side does not want to cut government spending,” Labrador said. “If his economic agenda is to raise taxes and spend more money, then the answer is going to be that we can’t work with him.”