Hold a Washington news conference and you'll be sure to hear a lot about Washington obsessions.
Two big ones dominated President Barack Obama’s prime-time encounter with the White House press corps: budget deficits, and growing criticism in the Congress that the new president is biting off more than he can chew.
Obama fluently answered the questions, sometimes at considerable length. But his responses were typically variations on a single-word theme: Whatever.
He made it clear that he believes that his success or failure depends above all on whether he is able to make seismic shifts—and expensive ones—in the nation’s health care and energy policies. And he is fairly easy-going about the precise legislative path these initiatives take, or whether certain details fall out along the way.
Most of all, he’s entirely comfortable with his bet that he and the country can worry about certain inconvenient facts—like a 10-year deficit total of $9.3 trillion under his plan — some time later.
Obama’s desire to simultaneously engage and brush off these Washington obsessions resulted in a news conference with a lot of code words and between-the-lines answers. Here is POLITICO’s translation of What Obama Said and What Obama Meant:
ON VETO THREATS:
What he said: “Now, we never expected, when we printed out our budget, that [Congress] would simply Xerox it and vote on it….The bottom line is—is that I want to see health care, energy, education and serious efforts to reduce our budget deficit.”
What he meant: Chill out. I’m just not going to get all worked up about the fact that Kent Conrad and some other moderate Democrats are upset about the cost of my plans. If they want to tinker, go ahead. But you watch—I’ll get nearly everything I want.
Obama’s answer came to a question from ABC’s Jake Tapper noting that a version of the budget being drafted by Senate Democrats does not include a middle-class tax cut (beyond the short-term version included in the recent stimulus package) or a “cap-and-trade” program to reduce greenhouse gasses. Obama signaled that he is not going to get in a big argument about the middle-class tax cut if he can defer that for a couple years. On energy, he was more forward-leaning: “It’ll be authorized. We’ll get it done. And I will sign it. Okay?”
ON HIS BUDGET:
What he said: “At the end of the day, the best way to bring our deficit down in the long run is not with a budget that continues the very same policies that have led us to narrow prosperity and massive debt. It’s with a budget that leads to broad economic growth by moving from an era of borrow-and-spend to one where we save and invest.”
What he meant: There is no way I am going to lose the language wars in a budget battle. My budget may borrow more and spend more than any in history. But I am going to frame this plan with appeals that emphasize sobriety and responsibility. That may be a bit brazen, but no more than Republicans who rubber-stamped huge deficits under Bush.
At every turn, Obama presented his plan as one that will create “secure and lasting prosperity,” and provide an antidote to an era of “reckless speculation, inflated home prices, and maxed-out credit cards” that created an “illusion of prosperity.”
It is an obvious question to ask why the answer to a society that spent and borrowed too much is a massive spending program financed with borrowed money. Which is why Obama found himself dealing with so many deficit questions.
ON LONG-TERM DEBT
What he said: “A budget is a snapshot of what we can get done right now, understanding that eight, 10 years from now we will have a whole series of new budgets.”
What he meant: Give me a break. As Keynes said, in the long run we are all dead.
The country is a wreck right now. We can worry about 2020 later.
Although he spoke in anodyne language, Obama was probably as candid as he has ever been about his theory of the case regarding federal spending and long-term deficits. He said that the big engine of the deficit over time is health-care spending. If the country makes an expensive move now to expand access to health care, with a much bigger role for the federal government, it can move to clamp down on the growth in Medicare and Medicaid spending down the road.
The main variable on deficits, he noted, is economic growth and the tax revenues that result. His bet is that he has produced a growth budget that will allow him eventually to make the deficit worrywarts look irrelevant. While making the case, he noted that his budget forecasts 2.6 percent annual growth, while the Congressional Budget Office estimates that growth will be only 2.2. percent. He described these as “small differences,” though in fiscal terms they represent an enormous gulf.
ON AIG BONUSES:
What he said: “You know, there was a lot of outrage and finger-pointing last week, and much of it is understandable….At the same time, the rest of us can't afford to demonize every investor or entrepreneur who seeks to make a profit. That drive is what has always fueled our prosperity, and it is what will ultimately get these banks lending and our economy moving once more.”
What he meant: Put the pitchforks down, folks. AIG outrage is last week’s story. This week’s story is my plan to use generous federal subsidies to convince investors to clean up the banks by buying their toxic assets. The plan won’t fly if I am seen as anti-capitalist.
He returned to the issue when CNN’s Ed Henry pressed him on why if he was so mad about AIG bonuses, he waited days to express his outrage, and why he’s letting New York Attorney General Andrew Cuomo hog the spotlight on the issue.
“It took us a couple of days because I like to know what I'm talking about before I speak,” Obama said.
Translation: Put a sock in it, Ed.
ON HIGHER TAXES FOR THE AFFLUENT
What he said: “It's not going to cripple them. They'll still be well-to-do. And, you know, ultimately, if we're going to tackle the serious problems that we've got, then, in some cases, those who are more fortunate are going to have to pay a little bit more.”
What he meant: Suck it up, rich folks, and welcome to your post-Bush tax code.
Obama is not entirely comfortable with either the politics or economics of tax hikes. If he were, he would be moving immediately to end George W. Bush’s 2001 tax cuts. But, it’s a sign of how far the political pendulum has swung that this president is notably non-euphemistic and non-remorseful about his plans to hit up high earners, and the fact that he doesn’t want to hear a lot of whining from them. The rub, of course, will come later, in the debate about whether he really intends to stick with his definition of $250,000 as rich.
The answer came when he was pressed on whether he still thought it was a good idea, as he proposed in his budget, to limit tax deductions for gifts to charity by the rich. At one point, Obama seemed to slip by referring to the idea in the past tense—possibly reflecting the political reality that charitable groups hate the idea and lawmakers are expected to kill it.
ON ASKING AMERICANS FOR “SACRIFICE”:
What he said: “With respect to the American people, I think folks are sacrificing left and right. I mean, you've got a lot of parents who are cutting back on everything to make sure that their kids can still go to college. You've got workers who are deciding to cut an entire day -- an entire day's worth of pay so that their fellow co-workers aren't laid off.”
What he meant: I know that Washington reporters and think-tank experts think all politicians are weak and irresponsible unless they are cutting entitlements or asking the middle-class to suffer. Well, I know a political trap when I see one.
This question was a little trickier than it seemed. Obama knows that most voters want to know what their government is going to do for them, not the other way around. On the other hand, he also did not want to echo George W. Bush, who looked frivolous when he told Americans after the September 11, 2001 attacks that they should “go shopping.”
ON PROSPECTS FOR PEACE BETWEEN ISRAEL AND THE PALESTINIANS:
What he said: “How effective these negotiations may be, I think we’re going to have to wait and see. But, you know, we were here for Saint Patrick’s Day, and you’ll recall that we had what had been previously sworn enemies celebrating here in this very room; you know, leaders from the two sides in Northern Ireland that, you know, a couple of decades ago or even a decade ago people would have said could never achieve peace.”
What he meant: Please refer all non-emergency foreign policy questions to Secretary of State Clinton – and in the meantime please accept this heartwarming story as down payment on an Israel policy.
Obama knows there’s a big difference between Northern Ireland and Israel-Palestine. But while he’s straining to manage a global economic meltdown and complete his Afghanistan policy, he isn’t particularly focused on coming up with a new take on this old crisis.
Lucky for him, the press corps isn’t focused on foreign policy, either: only this question and one about Mexico raised an international subject unrelated to the economy. That’s right—exactly zero questions about the wars in Afghanistan and Iraq.
ON DEFENSE SPENDING
What he said: “Kevin Baron, Stars and Stripes. Is Kevin here? There you go.”
What he meant: You have to admit, I am clever. I get to call on a reporter who is not from one of the big news organizations, whose subject is going to be easy to predict, and whose question I can answer by pointing out that I want to improve health care for veterans.
Obama also told Baron he supports reforming military procurement policies, a bipartisan goal, but acknowledged it is hard to do.
He also called on reporters from other niche outlets, such as the Hispanic network Univision, while stiffing reporters from the New York Times, Washington Post, and Wall Street Journal.