Budget fight becomes Obama's big gamble

ANALYSIS

WASHINGTON - President Obama's budget gamble has only gotten bigger, even as Washington's response to the self-inflicted crisis has gotten smaller.

Now that the sequester has gone into effect - bringing on the spending cuts Obama once guaranteed would never happen - the president is in the awkward place of rooting for it be felt as he and his administration has predicted.

At stake is the president's credibility in the latest round of the seemingly endless budget wars, which seem poised to dominate if not subsume his second term. Even before the cuts began, the president and his top aides were caught stretching the truth of their impact a few times, feeding his critics' argument that the nation can afford budget trims.

Beyond that, the president's vision for governance is being put to an extraordinary test. With the two sides drained and declaring something of a weary truce, the president's entire strategy for restoring the latest cuts depends on the public rising up and rejecting cuts to government services.

"The question is, can the American people help persuade their members of Congress to do the right thing?" Obama said Friday, in announcing that the once-unthinkable sequester cuts had become unavoidable.

Politicians Settle in for Sequestration Long Haul

If pressure forces the GOP-led House to capitulate, the president may yet win the war with tea party forces that have irrevocably altered the course of his time in office. Get the public engaged in this fight enough to convince Republicans who've worked with the president on virtually nothing, and that's a bright spot in a beleaguered Washington.

If he loses this battle, though, he'll find himself locked in perpetual spending crises at least through next year's congressional elections. The president may ultimately have to cater to Republican demands for even deeper spending cuts, with new tax revenues all but off the table.

That's where the president's awkward position comes in. As leader of the federal government, he of course wants to mitigate the real-world impact of budget cuts, to make sure people feel as little disruption as possible in their day-to-day lives.

Sequester: What Will Happen

But the $85 billion in cuts that are now coursing their way through the federal bureaucracy will have real impact. The fact is the president needs that to be the case, to exert the kind of political pressure on Republicans over spending cuts that hasn't been there to date.

"My belief is that as this pain starts to gradually spread to communities affected by military spending, to children who need mental health services, to people who care about our border security, I believe that more Republican colleagues who are concerned about this harm to their constituents will choose bipartisan compromise on revenue raising tax reform with serious entitlement reform," White House economic adviser Gene Sperling said on ABC's "This Week with George Stephanopoulos."

Republicans have their own problems when it comes to the sequester, both on the substance and in messaging. House Speaker John Boehner has raised alarms about the sequester's impact on Defense spending, and in an interview that aired today said he wasn't sure whether it would "hurt the economy or not."

Sen. Kelly Ayotte Keeps Door Open for 'Big Agreement' on Budget

Other Republicans, meanwhile - including many aligned with the tea party - see the sequester as an important step toward what they say is fiscal sanity. Rep. Steve Scalise, R-La., last week called the sequester "a big victory" for the GOP.

The one thing Republicans aren't budging on is taxes. That would seem to close out avenues of compromise; any plan to replace the sequester, the president is saying, must include ridding the tax code of loopholes that primarily benefit the wealthy.

The president's Friday news conference included an extraordinary admission: that he lacks the direct powers to do much about the current state of affairs in Washington.

"What more do you think I should do?" he asked reporters, not entirely rhetorically.

There are no easy answers to that question. So, with a policy in effect that was designed to be so awful as to force an alternative, all he and his critics can do is wait.

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Source: http://news.yahoo.com/budget-fight-becomes-president-obamas-020009050.html

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