Sunday, April 14, 2013

More on Obama's Budget Plan

Obama's recent budget proposal may limit his bargaining power with the GOP. According to an article by the Associated Press, "In essence, Obama's spending blueprint is a final offer, a no-budge budget whose central elements have failed to persuade Republicans in the past." More specifically, Obama has already conceded to entitlement cuts, such as slowing the rise of the Social Security benefits, so he really couldn't make any further concessions if the Republicans were to enter a negotiation.

Furthermore, many of his fellow Democrats are not pleased with his move to touch the social security benefits, which the Democrats tout as one of the core achievements of their party; they feel more so when Obama proposed it even before the negotiation. "If he's trying to do it to show he is forthcoming as a negotiator, then why doesn't he wait until he gets to the negotiating table?" said Rep. Rush Holt, D-N.J. "There's a lot of talk about the fact that politically this is not a winner. Our brand is the party that brought you Social Security."

To please his own party, Obama proposed a tax increase for the wealthier people, which the Republicans, on the other hand, would openly reject. Senate Republican leader, Mitch McConnell,  while praising Obama's proposal to cut entitlements, said that the proposal does not "bridge the differences between the House and Senate passed budgets."According to the Senator, the proposal is hardly a compromise, but “[is] really just a pivot from left – to left.”

Just as a reminder, Obama's budget proposal would change the way government calculates the inflation rate, the CPI (Consumer Price Index); the new CPI would slow the rise of social security benefits. Do you think what Obama's doing (proposing entitlement cuts before the negotiation with GOP) is a wise move? Has he he screwed up this time?

4 comments:

Unknown said...

Well Kevin, I believe that in such situations, negotiations are very difficult due to faction ideologies clashing. Neither side is willing to concede defeat, and both drive a harsh bargain for their respective sides. I think Obama did what was necessary to please his party, while maintaining a not too much less than cordial relationship with the GOP. However, with Obama being on his last term, I don’t see too much reason for him flattering his own party so much since he does not need to worry about reelections.

Obama’s move regarding “proposing entitlement cuts before the negotiation with GOP” is obviously doomed for failure. With so much party antagonism, Obama’s negligence is likely to land him with much disfavor and opposition from the GOP. Through and through, I recognize that Obama is in a tough spot, and this move is probably a consequence of that. I don’t think Obama screwed up, but the situation was mainly the cause of fault.

Paniz Amirnasiri said...

I cannot predict how successful he will be, but I applaud Obama for proposing a plan rather than a suggestion. As far as I can tell, his plan manages to include factors that will please (and, inescapably, displease) both sides of the political spectrum. An attempt at pre-negotiation compromise is not something that I would consider a screw up. However, perhaps it is a bit too idealistic within our political system.

Robert Pollock said...

While making concessions before reaching the negotiation table might not have been the best idea, I'm glad Obama is going against his party and supporting Social Security reform. With the baby boomers retiring, Social Security costs are going to far exceed what the government can afford. It makes no sense to maintain the status quo when reform is desperately needed. While the democrats often use their support for maintaining entitlement programs as they are now to help get reelected, Obama doesn't have this problem, and thus is in the perfect position to take on the unpopular issue. Hopefully Republicans will recognize this as one of their few chances to make reforms and be willing to compromise on more issues, such as raising taxes on the rich.

Jessica Ding said...

I don’t think changing Social Security benefits hurts particularly the Democratic Party for the reason that it was the party who created Social Security. All Americans support Social Security in some shape or form, whether Republican or Democrat. The Democratic Party may be the party who brought Social Security but it is not the role of the party to make sure Social Security is untouched or to always support the growth of its benefits, nor is the party going to completely abolish the program. Obama has to cut something in order to minimize the financial crisis and any cut, though necessary (or, I guess, depending on what he’s cutting but I assume everything the United States is spending on has some importance), would have backlash against it. From the tax assignment in class, we’ve seen that we spend a significant portion of our money for programs directed toward the elderly as compared to other expenditures. I think Obama chose an informed decision and weighed the effects of cutting entitlement programs as opposed to other programs; in that way I do not believe he screwed up.

Negotiations with the GOP would slow the finalization of a budget proposal and the debate is too contentious to reach an agreement that everyone is in favor of. I think Obama was reasonable to already concede to a budget proposal though this adds to the antagonism from the Republicans.