Finger Pointing As Obama, Republican Lawmakers Take No Action To Stop Sequestration
Friday, March 1, 2013
WASHINGTON (AP) — A combative President Barack Obama blamed Republican lawmakers Friday for failing to stop automatic spending cuts from beginning to kick in late in the day, arguing he can't perform a "Jedi mind meld" to get Republicans to agree on a deal. But he and GOP leaders displayed no appetite for letting the fight shut the government down later this month.
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Meeting on the day that $85 billion in federal spending cuts were to begin to take effect, the nation's top government officials made no progress on how to avoid what they all agreed would be damaging reductions in defense and domestic spending.
Obama conceded after the session that he hadn't been able to persuade Republicans to accept his proposal to reduce deficits with a blend of tax hikes and long-term reduction in entitlement spending.
Pressed on whether he bears some responsibility for the stalemate, Obama expressed frustration — and mixed his sci-fi metaphors.
"I'm presenting a fair deal, the fact that they don't take it means that I should somehow, you know, do a Jedi mind meld with these folks and convince them to do what's right," Obama said. The Jedi reference comes from Star Wars, and the mind meld from Star Trek.
Still, following a nearly hour-long meeting in the White House, Obama and the top four leaders in Congress generally agreed not to create a crisis out of a March 27 deadline when federal authority to spend on government operations runs out.
"It's the right thing to do to make sure we don't have a government shutdown," Obama said following the meeting. "And that's preventable."
Republican House Speaker John Boehner's office said participants in the meeting agreed legislation should be enacted this month to continue government operations while lawmakers and the administration work separately to find ways to replace the automatic cuts.
The cuts were to take effect by the end of Friday despite a parade of administration officials warning of grim consequences.
But while Obama called the cuts "dumb" and predicted they would hurt the economy, he also said: "This is not going to be a apocalypse."
Obama is seeking a big fiscal deal that would raise taxes and trim billions from expensive and ever-growing entitlement programs. But with automatic federal spending cuts ready to start taking their toll, the path toward that grand bargain Obama campaigned on last year has significantly narrowed.
"The president got his tax hikes on January First," Boehner said bluntly after the meeting. "The discussion about revenue in my view is over. It's about taking on the spending problem here in Washington."
For Obama, Friday's session was the first opportunity this year to spell out his 10-year, $1.5 trillion deficit reduction plan in a face-to-face meeting with congressional allies and adversaries.
His chances are squeezed by anti-tax conservatives, by liberals unwilling to cut into Medicare and Social Security, and by a Republican leadership that has dug in against any new revenue after acceding to Obama's demands two months ago for a higher tax rate for top income earners.
The White House is still betting that once the public begins to experience the effects of the $85 billion in cuts the pain will be severe enough to force lawmakers to reconsider and negotiate. But the consequences of the cuts —the so called sequester — are likely to be more of a slow boil. Obama this week said the effect "is not a cliff, but it is a tumble downward."
Indeed, much of the impact won't be felt for weeks or more than a month; some effects, like possible teacher layoffs, wouldn't take place until the new school year in the fall.
Polls also show that the public is not as engaged in this showdown as it has been in past fiscal confrontations. And an NBC-Wall Street Journal survey indicates that Obama has lost some ground with the public on his handling of the economy.
Still, White House officials also say they believe Republicans will once again give way to additional tax revenue in part to avoid drastic cuts and in part to win reductions in Medicare and Social Security spending from Obama that they have been unable to get from Democrats before.
Given Washington's entrenched partisanship, Obama's effort could be dismissed as either another failed attempt at negotiations or as simply an effort to lay blame on Republicans for blocking compromise.
The odds aren't with the president.
Many conservatives are willing to accept the automatic cuts as the only way to reduce government spending, even though the budget knife cuts into cherished defense programs. Likewise, many liberals are beginning to embrace the cuts as a way to protect revered big benefit programs that have long been identified with the Democratic Party.
Moreover, many programs for low-income Americans are protected from the immediate cuts while the Pentagon — whose budget has long been a target of the left — faces across-the-board cuts of 8 percent and up to 13 percent in some of its accounts.
More than 20 Democrats in Congress, including veteran Rep. Ed Markey, a candidates for the Senate from Massachusetts, have signed a letter pledging not to cut Medicare, Medicaid or Social Security benefits in efforts to reduce the deficit.
Obama's plan calls for $580 billion in new revenue over 10 years by limiting the value of itemized deductions and certain tax exclusions to no more than 28 percent. That means taxpayers with a tax rate greater than 28 percent would face a tax increase.
While Obama also regularly talks about closing loopholes to gain more revenue, his tax plan would close many corporate loopholes to lower corporate tax rates, not to generate more revenue. He aims to drop corporate tax rates from 35 percent to 28 percent for most corporations and down to 25 percent for manufacturers.
In exchange for new tax revenue and a tax overhaul, Obama has offered to reduce spending in health care programs such as Medicare by $400 billion over 10 years, change an inflation formula for government benefits that would result in lower cost-of-living adjustments for Social Security and other programs, and reduce other spending for total reductions of $900 billion over 10 years.
Those cuts, together with about $2.5 trillion in deficit reduction already achieved over the past two years through spending cuts and a year-end tax increase on taxpayers making more than $400,000 would achieve a $4 trillion deficit reduction target.
Republicans though are unimpressed, and Boehner rejected the plan when Obama first offered it in December.
At the other end of the spectrum, liberals are seeking to silence White House talk about cutting entitlements.
"They're almost on a daily basis talking about Social Security benefits," said Adam Green, founder of the liberal Progressive Change Campaign Committee. "There's no rational or political reason to do so, except some ill-conceived idea that Americans would value a grand bargain, even one that robs their grandparents of thousands of dollars."