March 25, 2013

Obama set to OK cuts he despises

The spending pullback will undercut his vision for the economic recovery and is likely to impede growth.

Zachary A. Goldfarb / The Washington Post

(Continued from page 1)

Politics poll: Spending cuts

Do you agree with President Obama's decision to lock into place deep spending cuts he says will slow the economy?



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President Obama is set to sign a government funding measure that leaves in place the across-the-board cuts that undermine many of the goals he laid out during the 2012 presidential campaign.

2013 file photo/The Associated Press


Lawrence Mishel, president of the liberal Economic Policy Institute, said Obama shoulders part of the blame for his situation. Since 2010, he said, Obama has spent too much time focused on the debt, including agreeing to significantly shrink domestic spending as part of his own budget proposals.

"I think they brought it on themselves to the extent that they validated the deficit issue," Mishel said. "It was always the case that the actual budget policy being pursued contradicted the rhetoric in the campaign. Now it's even worse."

White House officials say they will continue to press forward on proposals that would not require new federal funding, such as raising the minimum wage, opening manufacturing institutes, revamping housing policies and overhauling immigration laws.

Advisers say they say also won't give up on replacing the sequester, rejecting the notion that it will be permanent. The budget measure expires at the end of September, and another battle is already brewing for the summer. Obama will continue to nurture relationships with Republicans potentially willing to compromise.

The sequester undermines Obama's vision for middle class-driven economic growth in two significant ways, economists and his allies say. First, it takes tens of billions of dollars out of the economy in the next six months. The Congressional Budget Office, echoing other analysts, says that will slow the economy by 0.6 percentage points this year and destroy 750,000 jobs.

Second, the sequester reduces non-defense discretionary spending, a budget category with a mouthful of a name but a central role in the president's plans. This is the part of the budget where government invests in programs that pay off in the future, like education or clean-energy research.

The sequester cuts more than $25 billion from discretionary spending in the next six months, a 5 percent reduction.

Obama's supporters say he has already accomplished a lot toward his vision of helping the middle class -- namely by securing the revenues from $600 billion in tax hikes at the start of the year and through his health care overhaul.

Some say that might have to be enough, given that the Republican opposition in Congress is intent on dramatically shrinking government services.

"He has to be the firewall presidency," said Alan Brinkley, a historian at Rice University. "All he is really ultimately trying to do is protect the progressive legacy of the New Deal."


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Politics poll: Spending cuts

Do you agree with President Obama's decision to lock into place deep spending cuts he says will slow the economy?



View Results


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