Monday, March 16, 2009

Democrat Gamble makes Republicans Scramble

Harry Reid has criticized Republican's for not being bipartisan enough, claiming that they want President Obama to fail. But how can they be "bipartisan", if by definition it means jumping off a cliff with the Democrats? Is not agreeing to mutual suicide really "wanting Obama to fail"?

Ironically, I think if the Democrats would have worked on a truly bi-partisan approach to solving the crisis, they could have, with Republican help, insured Obama's success for improving the economy and creating jobs. Instead, they are taking a terrible gamble that seems suicidal to many of us.

This article in the San Francisco Chronicle attempts to make a very positive pitch for Obama's budget and the Democrat's agenda. But even with all the gushing and praise, it acknowledges many of the risks being taken:

Obama taking big political risk with budget
[...] After two years of protecting her conservative Blue Dog Democrats by signing off on farm subsidies and avoiding immigration votes, Pelosi has signaled a leftward shift, warmly embracing the Obama budget as the culmination of a vision she has fought years to achieve. "We are very excited, I guess is the word," Pelosi told liberal media representatives last week. "Now we have a president who shares our values and has the right priorities."

Like former President Reagan, who inherited an economic calamity from a deeply unpopular predecessor, Obama is using the crisis to change government's role in the economy. "We are at an extraordinary moment that is full of peril but full of possibility," Obama told PBS' Jim Lehrer, "and I think that's the time you want to be president."

If the polls are accurate, the economic meltdown has altered public attitudes about government, be it the appetite for health care reform, regulation of banks or higher taxes on the wealthy.

"What you've got is a context that makes a very ambitious budget strategy possible in a way that wouldn't be possible in times we would call normal," said Bruce Buchanan, a presidential scholar at the University of Texas. "This is a rare moment." [...]

I read the whole thing. I can follow the logic of the arguments being put forth in favor of what's being done. Yet I can't see that it's going to work, because it's the same flawed logic that got us into this mess. Even the article warns there are a number of pitfalls that could cause it to fail:

[...] Historically, a president's first year is almost always his most productive. "If you can't do it in your first term with your first budget, you almost never get a chance to do it later," said Stan Collender, a veteran budget expert now with Qorvis Communications, a Washington public relations firm. And when a new president comes from a different party than his predecessor, big changes are expected. [...]

President Obama's $3.6 trillion spending and tax plan is the most ambitious effort to shift the federal government's role in the economy since former President Ronald Reagan's in 1981. But instead of rolling back government, Obama advocates spending in three key areas, each dependent on the others. If Congress declines to raise taxes on carbon emissions, for example, money for the middle-class tax credit vanishes, forcing the deficit even higher. [...]

If Obama would only cut taxes to create jobs and increase investment, he would increase the tax revenue from new and expanding businesses, which could fund many of his programs. A true bi-partisan compromise could have achieved that. The problem is, in the name of "fairness", he's instead punishing business with higher taxes, causing investors to sit on their money, shrinking the tax payer base, and borrowing trillions to pay for the Democrat's massive budget agenda. It's growing a bubble that's bound to burst.

Debt is the problem, not the solution. Many Republican's turned against George Bush and the Republican Party for continuing to spend money we don't have, increasing our debt massively and weakening the dollar. And now ironically, Obama is compounding that problem.

If it works I'll eat these words, but I honestly don't see how it can. Jimmy Carter threw endless money at problems, with very bad consequences. It's looking more and more like Barack Obama intends to do the same.

This Administration is still new, and they could conceivably learn from their mistakes. Carter didn't learn from his mistakes, and had one term. Will Obama?

Related Links:

More than a bad day: Worries grow that Barack Obama & Co. have a competence problem

Is Obama taking on too much at once, at economy's expense?

President Obama: a "Leader" or a "Figurehead"?

Does Obama Know What He Is Doing?

HANSON: Maxing out a crisis card

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