In the on-going discussions between leaders from both parties on whether or not to raise the debt ceiling, one important question needs to be examined. Has President Obama been a leader on this issue? Critics of the president would obviously answer with a resounding "no." I happen to believe that the president has shown extraordinary leadership in dealing with this situation. First and foremost, the president, from the beginning, has been willing to compromise with congressional republicans on key issues within the Democratic Party such as Medicare, Medicaid, and Social Security. The willingness to compromise, the willingness to give up something you want (spending on these entitlement programs) to get something that would be of benefit to the entire nation (reducing the national debt and deficit) is the mark of a true leader. I can't necessarily say the same for congressional republicans who have yet to offer any compromise in return. Republican leaders have repeatedly said that tax hikes (which the president supports in addition to spending cuts), will not be a part of any deal. The age old argument against tax increases in poor economic times is that tax increases will kill jobs. Spending cuts alone will not solve our nation's huge financial problem. Revenues must increase as well. For those who say tax increases will not help the economy recover should study the presidency of Bill Clinton. Inheriting a recession in 1992, President Clinton not only cut spending, but increased taxes as well, and the country experienced the greatest economic growth it had seen in 50 years. Why can't this work again? Perhaps the greatest example of President Obama's leadership on the debt ceiling issue is the fact that he himself has said he is willing to lose his job to ensure the national government doesn't default on its loans. Someone who is willing to risk it all, including his own political future has my respect and admiration. We just don't see very many politicians today willing to do what is tough, what is difficult. This president, throughout this process has shown a willingness to do just that. With both sides unwilling to budge, Democrats and Republicans are taking a huge political risk. If a deal is not reached, and the nation does default, many will blame the president and it could indeed cost him his job. On the other hand, if a deal does not get done, many will blame congressional republicans for their unwillingness to work with the president. The President is banking on the latter. As a student and teacher of history, my experience has taught me that elections are all about perception. At this point, the president likes where he's at in the battle over public perception. The president believes when all is said and done, the American people will see that he is the one who has been willing to work on behalf of the American people, the one who has been willing to compromise in order to get a deal done. A recent MSNBC poll asked viewers who they would blame more if a deal doesn't get done. 48% said congressional Republicans while 34% said the President. Is the truth in the numbers? The President sure hopes so.
Kinda got the Republicans in a pickle here. I would agree that next November will favor the President if the Republicans hold a hard line. It would also favor the President if the Republicans give in and allow taxes to increase. I know tax increases will hurt the economy but I think the question needs to be asked, would defaulting on the national debt hurt worse?
ReplyDeleteIt should be noted that the majority of the tax increases that took place before the "Clinton Boom" were made before he was elected and by George HW Bush (who lost his job because of it). Bill Clinton then benefited from increased revenue combined with dramatically less military spending initially and then dramatically less entitlement spending (after the 1994 elections).
A slightly different situation here. Regardless of what the fickle and typically moronic public opinion concludes, I don't see any way out of increasing taxes to reign in the national debt. Republicans need to hold out until the cuts made to entitlement spending equal their initial demands (which would enable a balanced budget) and then concede to a tax plan that hurts business as little as possible (enabling a reduction in the debt that is such a burden on the budget).
How easy would it be to balance the budget if we weren't spending 2 of every 10 dollars in interest? Debt is studpid for individuals, families, and nations.