Last night I read an op-ed by Jonathan Rauch suggesting that President Obama should (a) adopt the Simpson-Bowles long-term deficit reduction plan, (b) propose some short-term fiscal stimulus, and (c) ask Congress to raise the debt ceiling for at least two years, so we don’t go through last year’s idiocy again for a while.
I thought about writing a response, mainly wondering why so many people fetishize Simpson-Bowles even though there are plenty of better plans out there, but I got lazy and didn’t. And a good thing! Today Ezra Klein makes what’s really the most obvious point of all:
Here’s the thing: The White House already released this plan. It was called “Living Within Our Means and Investing in the Future: The President’s Plan for Economic Growth and Deficit Reduction.”
They sent it to the Special Joint Committee on Deficit Reduction — better known as ‘the Supercommittee’ — back in September 2011. It included a large short-term stimulus in the form of the American Jobs Act, a longer-term fiscal retrenchment component based loosely on Simpson-Bowles, and, because the ‘Supercommittee’ was empowered to raise the debt ceiling when it greenlighted a plan, an end to further debt-ceiling shenanigans. You can read the whole thing here (pdf). The White House continued to push this proposal in its 2013 budget, which included most of the stimulus and deficit-reduction proposals included in this plan.
I don’t think this kind of plan is the political winner Rauch thinks it is. I suspect he’s mistaking Beltway conventional wisdom (and his own preferences) for the preferences of the rest of the country. But that’s arguable. What’s not really arguable is that Ezra is right: Obama has basically already done what Rauch wants him to do. We can quibble over the details — Is the AJA a big enough stimulus? Does Obama’s plan reduce long-term spending enough? — but any way you look at it, Obama’s plan is roughly what Rauch says he wants to see.
So why doesn’t he know about it? Probably because it never got any love from the pundit class and it died as soon as Obama sent it to Congress. Nonetheless, Beltway centrists continue to think that if only Obama proposed another plan just like the one that already sank like a stone, this time it would really catch fire. But we never learn why.
In any case, here’s my guess. The Rauch/Obama/Simpson/Bowles plan is going nowhere because (a) spending cuts are unpopular, (b) the masses don’t really believe in Keynesian stimulus, and (c) the masses also don’t really believe in promises to reduce the deficit “a few years down the road.” That makes plans like this a very heavy lift. Whatever it is that voters are looking for, this isn’t it.
