In questioning whether President Obama was wise to choose Jacob (Jack) Lew as his new OMB director, Edmund L. Andrews proceeds from a questionable premise.
To be sure, Andrews -- in his new blog, The Vault -- gives Lew his due, describing his sparkling resume, his previous confirmation as deputy secretary of state, his experience as OMB director under President Clinton, and the respect he has earned from fiscal experts in Washington.
He also describes Lew’s less overtly political profile, as compared to two others who were said to be in the running for the job – Gene Sperling, a top aide to Treasury Secretary Timothy Geithner and, previously, to President Clinton, and Laura Tyson, also a former top economic aide to Clinton.
Andrews, however, then asks, “But is this the right time for a patient, diligent, and perhaps phlegmatic operative?”
Facing the twin challenges of finding common ground with Republicans over deficit reduction and finding the economically correct time to push for it, Andrews suggests the low-key Lew may prove less effective “in a capital dominated by strong egos and round-the-clock partisan warfare, much of it broadcast on television.”
Let me offer an alternative perspective.
Fiscal policy is quintessentially political. The political scientist Harold D. Lasswell defined politics as “who gets what, when, how.” Fiscal policy answers those very questions – who gets what public benefits and who pays what taxes, and when and how they get those benefits and pay those taxes.
With deficits due to explode in the coming years, the question for policymakers increasingly will be which Americans should receive fewer benefits, pay more taxes, or some combination thereof. How the political parties decide that question is far beyond the scope of a particular OMB director.
Obama has to convince his fellow Democrats to do more to rein in health care costs, restructure Social Security and limit other domestic spending. He also must break his pledge not to raise taxes on anyone earning up to $250,000 a year, for holding to it would eliminate 98 percent of taxpayers from the effort.
Republicans, who already have the votes to block legislation in the Senate and will have many more votes – if not outright control – in both chambers after November, must soften their obstinate refusal to consider any tax increases whatsoever, sign on to entitlement changes without attacking the Democrats on the issue, and work with Democrats to find viable savings in defense.
When the smoke clears after this coming Election Day, Obama and the congressional leaders of both parties will face the enormous fiscal challenges that lay ahead under the conditions of a new political terrain. They will have to balance their political and substantive agendas – deciding whether to cooperate with one another while, as each day passes, the risk of a deficit-induced economic crisis rises.
Yes, Obama will need economic spokesmen to make his case on TV and radio, in print and on the web. And, based on his earlier experience as Clinton’s budget director, Lew will do just fine in that role.
But, what Obama will really need as he navigates the tough economic and political terrain ahead is a seasoned budget expert, a person who knows OMB and is trusted on Capitol Hill from his days as a top congressional aide.
As for actually solving the enormous fiscal problems before us, and how quickly to act, that’s up to Obama and the 535 members of Congress.
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Lawrence J. Haas is former Communications Director to Vice President Gore and, before that, to the White House Office of Management and Budget. He's now a public affairs consultant who writes widely about foreign and domestic affairs, including fiscal policy.