Obama budget marks beginning of new battle

4:40 PM, Mar 2, 2014   |    comments
President Obama speaks at the Democratic National Committee winter meeting in Washington on Feb. 28.
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(USA TODAY) WASHINGTON - When President Obama unveils his budget request Tuesday, it will mark a starting point for Obama and Republicans to begin framing the choice facing voters ahead of mid-term elections.

Americans hoping to see a renewal of broad talks to cut the nation's debt will be disappointed. And the conversation surrounding the budget release already has taken a partisan edge.

"I will send Congress a budget that will create new jobs in manufacturing and energy and innovation and infrastructure, and we'll pay for every dime of it by cutting unnecessary spending, closing wasteful tax loopholes," Obama said in a speech to the Democratic National Committee on Friday. "Now, Republicans have a different view."

Already, the White House has said the president will step back from his earlier attempt to persuade Republicans to accept a grand bargain to reduce the soaring national debt that would include entitlement changes (something liberals abhor) and raising tax revenues (something conservatives hate).

Instead, Obama's proposal will detail $28 billion in new domestic funding, including funding for new manufacturing hubs, job training and early childhood education that will be offset by cost savings elsewhere. The Defense Department will get an additional $28 billion in its 2015 budget, but the administration is also calling for the Pentagon to begin reducing the size of the Army by 10,000 soldiers by 2019.

The plan will take off the table what is known as "chained-CPI", a proposal that would lead to less generous increases in Social Security benefits annually. The White House and its allies are using that decision to attempt to underscore that House Speaker John Boehner and his fellow Republicans have shown a lack of willingness to negotiate on reducing the deficit.

"The president included that in last year's budget, as part of an agreement ... where he said 'Republicans you should join me in at least closing some tax loopholes,' even one for the purpose of reducing our long-term deficit," Rep. Chris Van Hollen, the top Democrat on the House Budget Committee, said on Fox News Sunday. "Republicans could not not even identify a single tax loophole they would close."

Polls suggest that stepping back from the deficit conversation is good politics. Only 8% of Americans identified budget or deficit issues as the top issue facing the country, according to a Gallup Poll in February.

Republicans stood down last month when they allowed a one-year suspension of the debt ceiling without trying to win any cost-cutting concessions from Democrats as they have in past fights over the nation's borrowing limit.

Notably, the White House has made the case that the immediate pressure to slash the deficit has been somewhat mitigated by a projection that the deficit will come in at $514 billion in the current year, the lowest it's been since Obama took office five years ago.

But Republicans and some budget analysts say the White House is downplaying the independent Congressional Budget Office's calculation that the annual deficit is projected to balloon to over $800 billion by 2022, as Medicare costs are projected to rise.

"They are more worried about their next election than the next generation," Sen. Rob Portman, R-Ohio, said in a speech last week at the American Action Forum in Washington. "It's hard to imagine a worse abdication of our responsibility to the people we are elected to represent."

Maya MacGuineas, president of the bipartisan Committee for a Responsible Federal Budget, said Obama has underplayed that the deficit was halved largely through across-the-board spending cuts known as sequestration, the product of Democrats' and Republicans' inability to cut a long-term deficit deal.

"Republicans don't want to do revenues, the Democrats don't want to do spending cuts," MacGuineas said. "We're going to have to get real on both sides."

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