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Posts Tagged ‘budget’
April 11th, 2013 at 2:16 pm
Podcast: Social Security, Obama’s 2013 Budget Proposal and Other Horror Stories for Taxpayers
Posted by Print

In an interview with CFIF, Pete Sepp, Executive Vice President of the National Taxpayers Union, discusses Social Security, President Obama’s 2013 Budget proposal and the need for tax reform.

Listen to the interview here.

April 5th, 2013 at 3:52 pm
HHS Refuses State Requests for Medicaid Expansion Flexibility

States looking for flexibility under ObamaCare in how to structure and pay for expanding Medicaid can take a hike, according to an analysis by the Heritage Foundation.

States like Arkansas and Indiana have requested waivers from the health reform law’s expansion formula that creates millions of new enrollees at an eventual cost of billions of dollars to states.

The hope was to use existing state-based models like Indiana’s successful health savings account for low-income Hoosiers to increase Medicaid enrollment while retaining cost certainty for state budget writers.

But those hopes were dashed after the federal Department of Health and Human Services released a frequently asked questions (FAQ) sheet that flatly denied any request to deviate from ObamaCare’s one-size-fits-all, open-ended spending commitment for Medicaid.

With this announcement, the Obama administration has definitively articulated its idea of bipartisan reform.  Republican governors who capitulate and get in line are welcomed with open arms.  Those like Indiana’s Mike Pence can take their policy entrepreneurship somewhere else.

April 2nd, 2013 at 12:40 am
Private Philanthropy Saves Easter Egg Roll

If corporate welfare is subsidies paid by government to businesses, then is government welfare subsidies (voluntarily) paid by businesses to government?

According to the Washington Post, a $25,000 corporate donation from the parent company of the popular Airborne cold tablets played a big role in funding the annual Easter Egg Roll, a 135-year-old tradition the White House threatened to cancel over budget sequestration.  Other funds came from the sale of commemorative eggs sold at the event.

Maybe this could be the beginning of a trend.  With the sequester lopping off between $42 to $85 billion from the federal budget this year, perhaps it’s worth exploring which government programs could generate enough private support to ease the strain on current and future taxpayers.

Who knows; maybe we’ll get to see signs at the entrance of national parks saying, “Supported by Wal-Mart,” or “Brought to You by Whole Food Markets.”

April 1st, 2013 at 2:49 pm
Indiana’s Pence Makes Progress with Innovative Medicaid Expansion

The Indianapolis Star reports that Indiana Republican Governor Mike Pence, a possible 2016 presidential candidate, cleared an important hurdle today when the state’s House Public Health Committee approved a bill to expand Medicaid eligibility without relying on ObamaCare’s open-ended spending incentives.

Pence’s plan would increase Indiana’s Medicaid enrollment by an estimated 400,000, but within the state’s Healthy Indiana initiative begun in 2007.  As a health savings account, Healthy Indiana allots a certain amount of money to qualifying Hoosiers who then shop for doctors and treatment options within their budget.  In effect, it transfers the decision making process for health care away from government bureaucrats to private citizens.  By capping the amount, Healthy Indiana also gives state budget writers more certainty about the cost of Medicaid expansion in future years.

Contrast this with the unlimited spending commitment envisioned by the Medicaid expansion system under ObamaCare, and conservatives will see why Pence’s proposal should be watched closely.  Under ObamaCare, states would pay no cost for expanding their eligibility pool up to 138 percent of the federal poverty line.  But starting in 2017, those that expanded enrollment would pay for 10 percent of the increase.  Though seemingly a small percentage, the costs will run into the billions, with even more likely if the federal government decides to reduce its 90 percent subsidy, as President Barack Obama has already hinted at doing.

The future of health insurance reform looks like it will include some mix of government-regulated exchanges, subsidies, and cost controls.  The question dividing conservatives like Mike Pence and Paul Ryan on one hand from liberals like Obama on the other, is who gets to make the lion’s share of the decisions on how health insurance dollars are spent.  Conservatives value individual choice, while liberals favor centrally planned mandates.

Ironically, if the President wants ObamaCare to be fiscally sustainable, he’ll have to accept that the only way to do it is allowing conservatives like Pence and Ryan to inject into it as much personal freedom as possible.

March 30th, 2013 at 9:42 pm
Obama Should Call an Audible with Late Budget Proposal

With President Barack Obama’s legally required budget proposal arriving two months late (April 10 when it was due February 4), here’s a suggestion to ensure the document is something other than a White House-approved paper weight.

Because of the President’s unprecedented delay, both the Republican House and Democratic Senate have passed budgets, each with only party-line support.  Now that both sides have put their opening bids on the table, it would be wise to make the White House version a kind of third way compromise that includes some elements that both sides like.

One example would be to incorporate Paul Ryan’s idea for putting Medicare plans on a state-based, federally-regulated health insurance exchange.  Then, make the now obvious point that this plan, coupled with ObamaCare’s exchange for non-seniors indicates bipartisan agreement on a major aspect of health insurance reform.  Doing that would help change the focus of the debate on what Republican and Democrats have in common when it comes to moving forward on this issue.

March 22nd, 2013 at 12:18 pm
Tom Coburn Axes Taxpayer Money for Absurd Research

From Quin’s lips to U.S. Senator Tom Coburn’s ears…

Yesterday, Quin highlighted one of the many wasteful uses of taxpayer money funded by the National Science Foundation, a federal government agency that subsidizes some pretty dubious projects. (Such as the sex lives of ducks.)

Also yesterday Coburn, a Republican from Oklahoma and a committed budget cutter, persuaded a majority of his Senate colleagues to limit NSF political science grants to only those studies that are certified as “promoting national security or the economic interests of the United States.”

Citing just one example, Coburn said that “There is no reason to spend $251,000 studying Americans’ attitudes toward the U.S. Senate when citizens can figure that out for free.”

As I understand it, Coburn’s amendment only curtails political science-related research, meaning that the project Quin cited may still be allowed going forward. Even so, it’s a hopeful sign that Coburn established a precedent for at least one part of the federal budget that aligns national spending with the (true) national interest.

March 21st, 2013 at 8:54 pm
House Passes Ryan Budget 3.0

It’s a busy week on Capitol Hill for votes on the federal budget. Earlier today, House Republicans passed the third iteration of Budget Chairman Paul Ryan’s Path to Prosperity plan, 221-207.

In past years, House passage of Ryan’s plan would be the first, and last, serious congressional action on the federal budget, since Senate Democrats refused to support President Barack Obama’s proposal or submit one of their own.

But not this year. Tomorrow, Senate Democrats will begin debate on their first budget outline in four years. As an added twist, the Democrats will offer amendments that resemble Ryan’s plan to see if Senate Republicans will go on the record to support it.

Voting will likely stretch into the wee hours of Saturday morning before Congress adjourns for a two week recess.

Politics aside, the Miami Herald shows just how far apart the sides are from a bipartisan resolution:

Total spending

Senate Democrats: $46.5 trillion

House Republicans: $41.7 trillion

Total revenue

Senate Democrats: $41.2 trillion

House Republicans: $40.2 trillion

10-year deficit

Senate Democrats: $5.4 trillion

House Republicans: $1.4 trillion

National debt at end of 2023

Senate Democrats: $24.4 trillion

House Republicans: $20.3 trillion

Social Security

Senate Democrats: $11.3 trillion

House Republicans: $11.3 trillion

Medicare

Senate Democrats: $6.8 trillion

House Republicans: $6.7 trillion

Health, including Medicaid and the State Children’s Health Insurance Program

Senate Democrats: $6.6 trillion

House Republicans: $4.0 trillion

Check out the entire list here.

March 5th, 2013 at 1:18 pm
Pennsylvania Next Medicaid Expansion Domino to Fall?

Pennsylvania Republican Governor Tom Corbett may be wavering on his refusal to expand Medicaid under ObamaCare’s bait-and-switch funding scheme.

I don’t envy him.  He’s surrounded by states like Ohio and New Jersey, whose GOP governors opted to indulge the fantasy that they can accept the federal government’s promise of full funding at face value.

To his credit, Corbett isn’t allowing himself to act like there are no costs associated with agreeing to so-called “free” Medicaid expansion for the next three years.

Here’s some refreshing honesty from Corbett’s spokeswoman Christine Cronkright:

The Corbett administration has estimated that participating in the Medicaid expansion that would add 800,000 people to medical assistance would cost Pennsylvania $1 billion through 2014-15 and a total of $4.1 billion. Advocates maintain that the Medicaid expansion would pay the way for $43 billion in federal contributions, beginning with three years in which the federal government would pay 100 percent of the expansion.

“Regardless of the federal government’s claims, the presumption that they will cover 100 percent of the costs of full expansion is simply not true. Regardless of any other costs under the (Affordable Care Act) that we’d have to bear, there are still IT and staffing costs, costs for additional clients coming into the system that may have been eligible before, and costs for those we believe will drop employer-based coverage,” Cronkright said.

So it turns out “free” really means $1-4 billion.

The simple truth about ObamaCare’s Medicaid expansion is that it establishes a one-way street toward greater federal intervention in every individual’s health care decisions. Democrats know this, and are using the “free” money trope to lure weak-willed Republicans into a federally-dominated system from which a state will not be able to extract itself.

GOP governors who agree to expansion and believe that they will have the political support to simply cut off access to Medicaid when the feds pull back funding are deluding themselves. Besides, what kind of leadership is it to support welfare expansion on the condition that someone else pays for it with their debt-laden credit card?

So far, Governor Corbett is standing firm in the face of tremendous opposition to fiscal sanity.  Let’s hope he continues.

March 1st, 2013 at 2:10 pm
Paul: Sequester is a 5% Cut on a 17% Increase

U.S. Senator Rand Paul (R-KY) shines a spotlight on the true impact of today’s sequester cuts:

If the sequester were to take effect, our spending would only be cut by 2.3%. Let me repeat that — these “eviscerating” cuts will leave our country with 97.7% of our current spending, cutting a mere $85 billion from this year’s $3.6 trillion budget.

The sequester barely begins to skim the surface of the problem. Since taking office, President Obama has increased federal domestic agencies’ budget by 17%. This 17% increase since 2008 will have to endure a 5% cut.

Even with the sequester, the federal government will spend more in 2013 than it did in 2012 — or more than $15 billion.

An editorial in Investor’s Business Daily spells out in greater detail just how much federal spending has grown during the Obama Administration:

…here are some examples — using the OMB’s data and projections — showing the growth in spending for various federal functions since 2008 (percentage increases are inflation-adjusted):

• Transportation: up $36.6 billion, an increase of 37.5%.

• Education: up $30.8 billion, or 25%.

• Housing assistance: up $16.4 billion, or 31.4%.

• Community and regional development: up $11 billion, or 36.5%.

• Natural resources and environment: up $9.5 billion, or 21.3%.

• Farm income stabilization: up $6.8 billion, or 39.5%.

• General government: up $5.9 billion, up 26.6%.

This doesn’t exhaust the list of nondefense discretionary spending; it leaves out energy boondoggles and the burgeoning food stamp program, among others.

Other important budget items immune from sequester are federal entitlements like Social Security, Medicare, and Medicaid, to name just the most recognizable three.

While any budgets cuts are going to be painful, the $85 billion on the chopping block now is, to use Paul’s word, a “pittance” when one considers that for the fifth year in a row the federal budget is likely to carry a $1 trillion deficit.

February 27th, 2013 at 2:55 pm
Chris Christie to Expand Medicaid

The key passage from Governor Chris Christie’s budget speech yesterday speaks volumes about where the New Jersey Republican stands on principle:

Let me be clear, I am no fan of the Affordable Care Act. I think it is wrong for New Jersey and for America. I fought against it and believe, in the long run, it will not achieve what it promises. However, it is now the law of the land. I will make all my judgments as governor based on what is best for New Jerseyans. That is why I twice vetoed saddling our taxpayers with the untold burden of establishing health exchanges.

But in this instance, expanding Medicaid by 104,000 citizens in a program that already serves 1.4 million, is the smart thing to do for our fiscal and public health. If that ever changes because of adverse actions by the Obama Administration, I will end it as quickly as it started.

Almost all of the same criticisms I leveled at Florida Governor Rick Scott this weekend apply to Christie and his reasoning.

The Governor’s characteristic bluntness, though, merits one further point.

By claiming that the Affordable Care Act (aka ObamaCare) “is wrong for New Jersey and for America,” and that “in the long run, it will not achieve what it promises,” Christie is admitting that he has decided to entangle New Jersey in a fundamentally flawed program that will fail to achieve its goals.  But don’t worry.  In the meantime, New Jerseyans can breathe easy because Christie, like Scott and the other Republican capitulators, will make sure to gobble up as much “free” federal taxpayer money as possible until he decides to pull the plug rather than help cover the costs.

One of the first rules of persuasion is to be coherent.  Christie’s tortured, self-serving logic doesn’t come close.

February 25th, 2013 at 1:37 pm
White House Tries to Avoid Sequester by Shaming the Public

As usual, Ezra Klein’s Wonkblog has an interesting series of graphs that show the power of the federal government in granular detail.  Today’s installment, courtesy of the White House, provides a state-by-state assessment of how the coming budget sequester will impact a range of federally-funded, state-run programs.

These include popular spending on initiatives such as teachers and schools, work-study jobs, Head Start, job-search assistance, military readiness, law enforcement, child care, vaccines for children, public health, nutrition assistance for seniors, STOP Violence Against Women Program, and clean air and water.

But while the White House is putting out these details to (ostensibly) convince the public that 10 percent across-the-board cuts in discretionary spending will be devastating to popular programs, there’s also a bit of subtle public shaming thrown in as well.  Reading through the graphs it becomes painfully obvious just how much of modern American life is subsidized by federal tax dollars (and in some cases, also supported by state taxes).  Getting confronted with that reality isn’t comfortable; especially when many people have come to rely on this kind of help.

And yet, something has to change.  We simply can’t raise enough taxes to cover the cost of every liberal social experiment, or even to pay for every good idea.  Instead, we as a country need political and other leaders to think carefully about how to modify the social contract we’ve been under since the New Deal so that the generations to come will not be cheated out of their inheritance.

Much like how they react to any reasonable reform ideas to Medicare (see any number of ‘Medi-scare’ tactics), liberals can’t lead on this modification project because they refuse to acknowledge that America has a spending problem in the first place.  It thus falls to conservatives to improve on what we have, preserving what’s good and making it better.

Part of the reason I’m optimistic about the future is that I don’t believe that details about our nation’s financial problems will shame a majority of citizens into zero-sum taxation.  Rather, I think that once people become aware of how overextended is our current welfare state, they will reward politicians who can show how to scale back the public sector so that the private sector can flourish.

February 5th, 2013 at 5:25 pm
CA’s Brown Faces Big Test over Shale Oil Fracking

It’s an interesting time to follow California politics.

Last month, Democratic Governor Jerry Brown announced that, thanks to the voter-approved tax hikes from last November, the state looks poised reap budget surpluses for the first time in years.

But instead of using those projections as an excuse to restore funding for programs pared back by budget cuts, Brown is promising to set aside the money in a rainy day fund.

Moody’s and S&P rewarded Brown’s announcement by upgrading California’s credit rating.

Now Brown faces an even bigger test.

There’s an estimated 15.4 billion barrels of oil in California’s Monterey Shale formation, or four times as much as North Dakota’s Bakken Shale reserves.  Another way to put it is that California is home to two-thirds of America’s projected shale oil reserves.  Opening it up would be a game changer for the nation’s oil security and California’s economy.

But here’s the rub, according to Walter Russell Mead:

The intrigues in this drama are many. Does California’s Democratic Party come down on the side of low income Californians, who desperately need the jobs and state services new oil extraction will fund? Or does it come down on the side of a green lobby that is heavily backed by some of the wealthiest people in the state? To what extent does the wealthy coastal elite control the future of the inland poor in California? Can the GOP use the issue as a wedge to rebuild its credibility in a state it once dominated? Will black gold bail out big blue California?

Bring lots of popcorn. This is going to be a terrific show.

January 23rd, 2013 at 8:01 pm
Senate Dems to Pass First Budget in Four Years

The Hill posted a jaw-dropping lead to describe just how broken is the federal budget process:

Senate Democrats on Wednesday said they will move a budget resolution through the Budget Committee and onto the Senate floor for the first time in four years.

Despite protests to the contrary, the move is in response to a House-approved measure to move the nation’s debt ceiling back from late February to early May.

It’s hard to applaud a group of adults for finally getting the regular budget process going in the Senate.  Still, it’s a sign of progress that a budget may actually be produced in accordance with federal law.

January 16th, 2013 at 8:12 pm
Calif. Has $1 Trillion in Oil, But Would It Stop Govt. Spending?

Mark Mills writing in The Wall Street Journal says that projections about California’s latent shale oil reserves could be the silver bullet for the state’s fiscal woes:

The overall economic benefits of opening up the Monterey shale field could reach $1 trillion. One can only imagine the impact on California’s education system, social programs, infrastructure, and even energy-tech R&D. Moreover, with that kind of revenue, Sacramento tax collections could wipe out debt and deficits.

But is it really plausible that California’s big-spending political class would use the $1 trillion windfall to pay off the state’s debts and seed a rainy day fund?  Call me cynical, but it seems way more likely that state spending would increase above and beyond whatever windfall comes from oil drilling.

That said, I’d love for Sacramento to prove me wrong.  Let the fracking begin!

January 14th, 2013 at 6:58 pm
Obama Misses Budget Deadline, Again

The Hill provides the text of a letter sent by the White House Office of Management and Budget to House Budget Chairman Paul Ryan (R-WI).

In it, the OMB’s Deputy Director for Management blames the late resolution of the “fiscal cliff” negotiations for causing the White House to violate the law by missing the February 4 deadline for submitting a budget to Congress.

But as The Hill notes, that excuse is nonsense when considered in light of the Obama Administration’s record on budgets:

Under the law, President Obama must submit a budget by the first Monday in February, but he has met the deadline only once. The annual budget submission is supposed to start a congressional budgeting process, but that has also broken down. The Senate last passed a budget resolution in 2009.

Left out of that tidy little summation is the fact that the House Republicans have never failed to pass a budget resolution during the entire time Obama has been president.

The failure of Washington to “work” in the Obama Era is not a failure of substance; both parties are relatively clear about their policy visions.  What’s grinding the system to a halt is the liberal disregard of legal procedures like statutorily defined deadlines.  Throw out the rules, and suddenly no one knows how to play the game.  As I said last week, unless the budget process is amended to enact meaningful punishment on parties who violate it, nothing else is likely to change.

January 9th, 2013 at 1:50 pm
Amend Budget Act, Not Constitution to Cut Spending?

Here at CFIF we’ve promoted the idea of a Balanced Budget Amendment to the U.S. Constitution that would require Congress to pass balanced budgets every year with certain 60 percent supermajority thresholds for raising taxes or the debt ceiling.

The idea comes with a stellar pedigree since conservative icons like Ronald Reagan, Jack Kemp, and the Contract with America all supported various Balanced Budget Amendments.

Alas, the BBA has yet to become law, and with the current lineup of liberals running the U.S. Senate and White House, it will be awhile before such an idea can be seriously discussed in Washington.

That said, Byron York says that Republicans might have an opening in the coming fight over raising the debt ceiling to get closer to a balanced budget; albeit by amending a statute, not the Constitution.

On its face, the Congressional Budget Act of 1974 sets out a clear deadline for passing a budget by April 15 every year.  The problem, however, is that there is no enforcement mechanism to punish Congress if it fails to do so.  With Harry Reid (D-NV) and Senate Democrats failing to pass a budget for the last 1,351 days as of today, the budget law’s impotency is on full display.

York reports:

“The law doesn’t have teeth,” says a Senate aide involved in the fight.  “Sen. Sessions and others have proposed process reforms to give the budget law teeth (one reform would make it harder to pass spending bills without a budget), but the debt ceiling is the strongest leverage we have on this. This is the opportunity.”

In other words, it is precisely because the budget law has no enforcement provision that Republicans believe they need some other form of leverage, in this case the debt ceiling deadline, to force Reid and his fellow Democrats to move.  In addition, whatever happens in the debt ceiling standoff, it seems clear that the original budget law should be amended to include some sort of enforcement method.

This strategy strikes me as a great way to get real value in return for raising the nation’s debt ceiling.  Imagine how much different Obama’s first term would have been if instead of ignoring the House Republicans’ Paul Ryan-inspired budgets, the President and Senate Democrats had to negotiate its terms up against a hard deadline.  Liberals would have been forced to debate conservatives on specifics instead of substituting scare tactics for policy.

So far, Republicans have said they want entitlement reform in exchange for upping the ceiling, and for good reason since spending on Social Security, Medicare, and Medicaid alone account for about 44 percent of the federal budget (other entitlements push the total to 62 percent).  Moreover, since entitlement spending is not discretionary, meaning it isn’t determined in the normal appropriations process but by eligibility formulas, reining in federal spending will require statutory changes that can only be gotten when the stakes are very high.

But if York is right, then Republican strategists would be wise to include changes to the Congressional Budget Act along with spending reforms to entitlements.  Winning both would improve the nation’s long-term fiscal outlook by helping conservatives change the way Washington does business.

January 7th, 2013 at 12:16 pm
Sizing Up the Hagel Nomination

Former Nebraska Republican Senator Chuck Hagel is poised to be nominated as the next Defense Secretary.  Politico’s Josh Gerstein has an interesting round-up of the five constituencies most likely to oppose Hagel, but I want to see how President Barack Obama’s pick articulates his position on military spending cuts.

After the fiscal cliff mess, Republicans are aiming to reform entitlements, while Democrats would prefer to ax the Pentagon.  If Hagel can give a reasoned defense for eliminating some unnecessary programs – such as projects that serve to stimulate local economic development rather than national security – then a way could be opened for responsible spending reductions over a wider array of budget areas.  Unlike the automatic spending sequester scheduled to reappear at the end of February, a Hagelian contribution like the one I’m imagining could go a long way to getting on the table real cuts that the broader public can accept.

We’ll see if Hagel makes good on the opportunity.

January 1st, 2013 at 11:36 am
Why House Conservatives May Vote Yes

In a very lengthy post at The American Spectator, I explain why the castor oil produced last night might be more good than bad for conservative digestions — by just a tiny amount, to be sure, and even then only if conservatives start playing their cards better in the coming months, but still an amount worth considering.  Please do take the time to follow the link and read the whole thing, but for now, the main point is that this deal actually does retain the lower spending levels (on discretionary spending) that conservatives had wanted. This fact should not be lost in the din of wailing and gnashing of teeth.

For purposes of this post, let me add to that AmSpec mini-essay to focus on two aspects of this deal that conservatives should truly celebrate.

Both involve “permanent” (in legislative lingo) solutions to vexing tax issues that conservatives have long sought.

First, this bill would permanently establish a $5 million threshold before the death tax kicks in. This is a huge achievement, protecting the vast majority of small businesses and family farms from this horrible tax. Even better, it indexes the threshold to inflation — so the exemption from the death tax will only grow over time. This is terrific. It is good economics, good policy… in short, a very good win.

Second, this bill permanently protects tens of thousands, probably hundreds of thousands, of taxpayers, from the evil Alternative Minimum Tax. How? Again, by permanently indexing the current threshold for inflation. Rather than leaving this hidden time bomb ticking, forever threatening to explode, subject to repeated “fixes” at the last minute by harried congressmen, this now enshrines into law the protections that all current taxpayers still below the AMT level now enjoy.

These are not achievements to scoff at. Sometimes it makes sense to bank some gains and come back to fight another day for other things of importance.

November 19th, 2012 at 2:06 pm
Will 2013 Be Like 1937?

If you’re a conservative looking for reasons to be thankful this November, don’t read Amity Shlaes’ column at Bloomberg today.  In it, the author of books on Calvin Coolidge and the Great Depression identifies four factors that make 2013 seem like 1937 – a pre-election government spending spree; talks of deficit reduction thereafter; presidential attacks on high-income earners; and the economic fallout from first-term “comprehensive reforms” like Social Security and Obamacare.

According to Shlaes, the combination caused “the depression within the Depression.”  Not something one wants to think about this time of year.

September 29th, 2012 at 6:11 pm
Obama’s Clinton Conundrum

Politico on why the Obama campaign is using former President Bill Clinton so often:

As the campaign acknowledges, Clinton brings credibility to the connection between an Obama presidency and a strong economy, reinforcing the idea that there’s a straight line between Obama’s proposals and Clinton’s legacy of budget surpluses and middle class prosperity.

It’s only a credible connection if you don’t consider the wildly differing contexts.

As Tim pointed out earlier this month, “the so-called “Clinton surpluses” didn’t arrive until 1998, four years after Newt Gingrich and the Republicans captured Congress for the first time in four decades, and six years after Clinton was elected.  Given the fact that Congress controls the budget under our Constitution, it is therefore disingenuous for Clinton and his apologists to claim sole credit.”

Thus, if in 2012 the Obama camp really wants to make the case that a national economic recovery is just around the corner, it should have prayed for a complete conservative takeover of Congress in 2010.  Had he been faced with an entire branch of government – not just the House – passing real budgets, chances are the Obama White House would have had a Clintonesque opportunity to make a deal.

Instead, Obama has had no incentive to move to the middle for the sake of compromise because Senate Majority Leader Harry Reid (D-NV) has been willing to abdicate his chamber’s constitutional responsibility to pass a new budget for the last three years of Obama’s term of office.  And so the President dithers while the economy sputters.

Call it the Clinton Conundrum.  Both Clinton and Obama are doctrinaire liberals whose policy impulses created pushes to nationalize health care.  Both prefer to raise taxes and spend money.  But Clinton, unlike Obama, was saved from oblivion when Republicans took over both houses of Congress in 1994 and (implicitly and unintentionally) made him an offer he didn’t refuse: either adopt our reform agenda or face defeat in reelection.  Clinton accepted and has benefited ever since.  Obama’s choice was between Senate Democrat dithering and House Republican reform.  He sided with his party and hasn’t governed since.

If Barack Obama wants Bill Clinton’s success, he’ll have to adopt Bill Clinton’s policies.  In large part, that means adopting conservative budget reforms so that he can claim credit for a rebounding economy.