A balanced budget? Not in election year
“We don’t begrudge success in America,” Mr. Obama said. But, he added, “We do expect everybody to do their fair share, so that everybody has opportunity, not just some.”
Hardly controversial stuff; or so you’d think. On Monday President Obama announced his budget for the 2013 fiscal year and along with it large swathes of his manifesto for re-election. In a campaign that is likely to be defined by economic issues, this budget was always destined to be political in nature. Yet, opponents have still found it within them to express commendable faux-outrage.
The words of leading anti-tax campaigner Grover Norquist were indicative of the criticisms Obama faced. He claimed “this is not an economic document, it’s not a policy document, it’s a political document”. Of course, it goes without saying that a budget is, at least in the most literal sense, an economic document. Yet the measures announced by Obama are in some parts so lacking in excitement and originality that they will do little to change the economic course already set, and in others so flagrantly partisan that they have no chance of being passed. So in truth, the budget will have a minimal economic impact at best.
This may seem a strange tactic from anyone presiding over Obama’s mediocre economic record, but in fact it may be just the budget Obama needs to help secure re-election. This is where we see why the announcement was so very political.
The measures taken by Obama since he took office are finally coming to fruition. Unemployment is down to 8.3% and decreasing at every count. Economic forecasts, such as those of the CBI here in Britain, rely heavily on the apparent American recovery for their positivity. Even Obama’s opponents are struggling to formulate a narrative that still portrays him as truly weak on the economy, and while the American people may remain somewhat cynical amidst talk of a “comeback”, it certainly seems as though continuing along the same path is the sensible option for Obama, both fiscally and politically. While the likes of Norquist decry “more of the same” and Republican candidates pander to voters on the campaign trail with calls for a balanced budget, Obama can simply point to the figures and argue that that is just what America needs right now.
Of course, there are a number of substantive and relatively radical economic measures included in the budget. While the implementation of the ‘Buffet rule’, getting the country’s highest earners to pay at least the same in tax as those less wealthy than them, would no doubt do a deal of economic good, it is primarily intended as an openly political measure. Like other ‘progressive’ measures included in the budget, the Republicans are certain to oppose the tax rise. This will make it a cornerstone of Obama’s campaign. His rhetoric on the matter is already skilfully though out; “fair play”, “shared responsibility”, “common sense”.
Yet the most powerful argument of all is this. Obama’s book sales have made him a millionaire, and thus currently entitled to a portion of the tax breaks. Though floundering currently, his likely opponent in November remains Mitt Romney, who is among America’s richest 0.006%; an open goal which Obama is certain not to miss. As he stated on Monday, “Warren Buffett’s doing fine, I’m doing fine. We don’t need the tax breaks. You need them.” He didn’t mean Romney.
Increasing taxes on America’s wealthiest was always going to be a sensitive issue for the Republican Party at the time of an election. They almost brought the federal government to a standstill as they insisted upon the extension of the notorious Bush tax cuts, but would be understandably keen not to appear too elitist when they need the votes of those who can’t afford expensive financial advisors. Made all the more potent by the fact that his rivals’ presumptive nominee is rich and seemingly all too keen for everyone to know it, it isn’t difficult to see why the ‘Buffett rule’ will take a central role in Obama’s bid for re-election.
The Republicans can’t simply complain that the Democrats are focusing on issues over which they are weak. They will be forced to engage with the President’s electoral agenda in some way and the betting is not on compromise. Obama’s got more than most riding on that wager, reliant as he is on blaming an unhelpful Congress for the disappointment his first term has, fairly or unfairly, brought so many of those who voted for him in 2008. The economic recovery may have arrived at the opportune moment to lessen this burden. With his rivals preoccupied and lacking clear leadership, Obama is not searching for political consensus any more.
Republicans may claim that the President is peddling class warfare, covering for his own weaknesses and attempting to divide Americans at a time when unity is necessary. In truth it is they who have polarised the political agenda, set Americans on each other and sought to absolve themselves of all responsibility for the state in which Obama inherited power. Now the anger and vilification which they were briefly able to channel towards the White House look set to come back and bite them; if not in their pockets then at the ballot box.
Announcing a budget more political than economic in its significance, President Obama claimed that Americans do not begrudge success. To gain a second term, Obama’s success appears to be dependent on his ability to draw a stark contrast between the political messages of America’s two parties. With a divided opposition and a resurgent economy, the scales are tipped in the President’s favour.
Posted on February 16, 2012, in Comment, Foreign Affairs, General, Looking Forward, US Politics and tagged america, Barack Obama, budget, Bush, CBI, Democrat, economic record, Grover Norquist, Mitt Romney, Obama, president, Republican Party, usa, Warren Buffett. Bookmark the permalink. Leave a comment.