The Vital Center
Friday’s job growth numbers, reported by the Labor Department, present a sobering picture for President Obama and the Democrats. With the pace of hiring down and the unemployment rate above 9 percent, the report suggests that the nation’s recovery is once again faltering. These numbers only underscore our continuing economic difficulties. And for a mix of political and policy reasons, the federal government has no significant new fiscal or monetary weapons left to deploy.
Over the past decade, both Democrats and Republicans have pushed major initiatives to restructure our health and entitlement systems, arguing that significant changes were necessary in order to keep them afloat. So far, their proposals have consistently lurched too far either to the left or to the right of the median voter, and they’ve paid for it dearly each time at the polls. But both parties are right about one thing: The status quo is unsustainable.
On a slow Friday afternoon, I settled in to read two lengthy reports—one from the West Virginia Governor’s Independent Investigation Panel on the Upper Big Branch/Massey Energy explosion that killed 29 miners, the other from the Urban Land Institute on the slow-motion crisis in U.S. infrastructure. On the surface, these reports seemed to have nothing in common. But as I plowed through them, I realized that they were addressing two sides of the same question—namely, what government does that nothing else can or will.
In his State Department speech last week, Barack Obama threw down the gauntlet to Benjamin Netanyahu. In the Oval Office a day later, and more fully in an address to Congress yesterday, Netanyahu picked it up and threw it right back. The question now is whether this clash can be turned into a new understanding between the United States and Israel that improves the prospects for the two-state solution both parties say they want. To bring this about, Obama will have to make further tweaks to his approach and rethink his declared stance on Palestinian refugees, among other matters.
Because my previous column on taxes stirred up some controversy, I thought it would be useful to put all the evidence on the table for everyone to consider. But before engaging the details, let me make my priors clear. First, I opposed the Bush tax cuts—all of them. As a good Clintonian, I thought we should use the surplus to make long-deferred social investment and to address the challenges of an aging population. Second, I favor significant income tax increases for the best-off Americans.
Because so much of what passes for political debate in this country takes place in a faux-fact zone, it is a welcome change to read Reihan Salam’s latest essay in the National Review. During the 2008 campaign, Barack Obama famously promised that taxes would either stay the same or go down for households making less than $250,000 a year.
Every five years, the Pew Research Center publishes a survey-based political typology, which uses attitudinal scales and cluster analysis to locate relatively homogeneous groups within the American electorate. This year’s survey found eight such groups—three at the core of the Democratic coalition (New Coalition Democrats, Hard-Pressed Democrats, and Solid Liberals), two Republican (Staunch Conservatives and Main Street Republicans), and the remaining three independent (Libertarians, Disaffecteds, and Post-Moderns).
Three recent items—two surveys and a news article—illuminate the current state of our country’s fiscal debate.
No later than the first year of the next presidential term, we’ll have to find a way of coming together around a plan to restore long-term fiscal sustainability. There are three principal impediments to agreement: the president’s health reform law; Medicare and Medicaid; and taxes. I don’t mean to suggest that other issues—such as defense and Social Security—are trivial, but only that the gaps on these issues seem easier to bridge. Of the three most difficult issues, one—the health reform law—will have to wait until 2013, because it will be a focal point of the 2012 presidential campaign.