I watched the President’s speech tonight, and I found it to be quite interesting for a number of reasons.
The first part of the speech seemed like “same old, same old,” and I think it will generally be perceived as such. It appears to be more of the “stimulus” concept that has been tried and — in the views of many people, at least, including me — has been found wanting. We’ll see what the bill itself says, but funding road and bridge construction projects to benefit construction firms and construction workers, extending unemployment benefits for yet another year, and arguing that the federal government should pay for the hiring of teachers, among other proposals, all sounds very familiar. How is any of this different from the massive 2009 stimulus bill that has come, been borrowed and spent, and gone, and nevertheless left unemployment above 9 percent?
The middle part of the speech, in contrast, was much more interesting. I think the President was signaling that he still wants to try to agree on a grand bargain. He didn’t say specifically how he would pay for his new, “Stimulus Jr.” proposal — those details will be coming in a week or so — but he did talk about the need to revisit and reform Medicare and Medicaid and the need for tax reform as well. If the President was serious in making those suggestions, there may be a basis for a meaningful compromise that actually puts those expensive programs on sounder long-term footing and gets rid of silly, outdated, tax breaks and special treatment.
The last part of the speech, with its vigorous defense of collective bargaining, government regulation, and government spending, sounded like a campaign speech and, like many campaign speeches, set up and knocked down some straw men. And, indeed, the President promised to take his message to the country. What’s wrong with that? I hope that he does so, and I hope that the country responds with its honest reaction to the President’s proposals. After we get the details of his plan and how to pay for it, let’s let the President’s ideas, the House Republicans’ ideas, and the ideas put forth by anyone else contend for support in the marketplace of ideas. That is how America should work.
The Bush-era tax cuts expire on December 31, so the deal needs to make it through Congress promptly. There is some question about whether the “grand compromise” will be sufficiently well received — particularly among President Obama’s liberal base — to be passed in the lame duck Congress. The concept of extending “tax cuts for the rich” is anathema to them, and they feel like President Obama weakly gave up far more to Republicans than he got in return.
