Wednesday, February 13, 2013

Obama Kicks off the 2014 Campaign

The President's Plans
Obama offers an genda aimed at electing a Pelosi House.

WSJ Editorial, February 13, 2013

The big question of President Obama's second term is whether he wants to forge bipartisan compromises in the next two years, or whether he wants to spend these years campaigning against Republicans to regain Democratic control of the House in 2014 and then finish his Presidency with another liberal crescendo. Judging by his inaugural address and Tuesday night's State of the Union, we're guessing he's going for Speaker Nancy Pelosi.

Mr. Obama's second inaugural was a clarion call to "collective action," as he put it, and Tuesday's speech showed what he thinks that should mean in practice. "The American people don't expect government to solve every problem," he said, while proceeding to offer a new government program to solve every problem.

Not enough job creation? Have the feds set up 15 new "manufacturing hubs" where business can get government advice.

Decaying public works? How about a "Fix-It-First" plan to pay the unemployed to repair roads and bridges? Thus do the "shovel-ready" stimulus projects of the first term become the "most urgent repairs" of the second.

Lousy K-12 results? Have the feds finance pre-school for "every child in America." A government study only recently found that any benefits from the current pre-school program, Head Start, wear off by third grade. But he'd still make it a universal entitlement.

Not enough money to subsidize electric cars or more Solyndras? Create a new Energy Security Trust, funded by taxing oil and gas companies.

Not all women earn as much money on average as men? Pass the Paycheck Fairness Act so government can unleash the trial lawyers to enforce equal pay.

Climate change? Congress must "soon" pass the Lieberman-McCain version of cap and trade that couldn't pass the Democratic Senate in 2010, or he'll unleash his regulators at the EPA.

Stagnant wage growth? Raise the minimum wage to $9 an hour and index it for inflation. But if a higher minimum wage can conjure middle-class prosperity, why not make it $20 an hour—or $50?

There was so much more, but the common thread is that this is what a Democratic President might expect to pass in a liberal Democratic Congress. It is not an olive branch for bipartisan deal-making with the House GOP. In its ambition and partisan framing, the agenda sounded like the opening bell in the 2014 Congressional campaign, an attempt to mobilize the new liberal majority he believes he has forged in his first four years.

That was also the theme of his proposals on the budget. He embraced "tax reform," though he defined it as lower taxes for businesses that do what he likes (manufacturers) and higher taxes for those that don't (oil and gas companies). He also spoke of "entitlement reform," but his only two concrete ideas were price controls on drug companies and more means-testing for affluent seniors. These won't come close to solving the health-care entitlement problem that even he admits is unsustainable, which is why Republicans don't think he's serious.

The one possible exception to his partisan agenda was immigration reform, on which Mr. Obama wisely laid down no red lines that might kill a deal. His brief statement of principles sounded similar to the Senate bipartisan outline, save for his notable omission of a guest-worker program. That omission will please the AFL-CIO, but we hope Mr. Obama realizes that reform without a flexible, expansive guest-worker program will lose business support.

Mr. Obama has never lacked for confidence, and perhaps he is right that he can steamroll his opposition in Congress, or in the 2014 midterms. But it's also possible that his re-election and a fawning press have made him too confident that the country wants as much new government as he seems to believe. The polls show voters think spending is a bigger problem than lack of revenues.

And for all his bragging Tuesday night of economic progress, his policies have produced a recovery with a mere 2% growth and falling middle-class incomes. Without faster growth in the private economy, his grand liberal plans will vanish faster than he imagines. 

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