In Sunday's column, I wrote that the Obama administration has no plan to avoid the sequester save raising taxes on the rich. That was unfair. The White House approach is not what I would like, but it is more balanced than I described.
Humiliation is a good teacher. So, I've been trying to think through my dissatisfaction — and clarify what I think the administration should do.
First, I don't believe that President Barack Obama should become a Bill Clinton-style centrist. The Clinton policies were fine for their time. But, since then, we've had two decades in which inequality has gotten worse, the structural problems slowing growth have accumulated and debt levels have exploded. We simply need more robust policies than anything modeled in that era of centrism.
Second, I don't think it's in Obama's interest to be the liberal Reagan. This is more or less the mode he has fallen into so far in his second term. The Republicans attack government, so the Democrats defend government. The Republicans champion the individual, so the Democrats champion the collective. This allows Obama to stay within the confines of Democratic orthodoxy. He can make gestures toward balance but doesn't really crusade for anything that fundamentally challenges his electoral coalition.
The problem is that this approach locks us into the same debate framework we've been stuck in since 1980, which has produced so much gridlock. If politics is framed in this way, then the country divides and policy stagnates. We will keep having these endless budget squabbles. The dysfunction will metastasize.
My main complaint with Obama is that he promised to move us beyond these stale debates, but he's, instead, become a participant in them.
My dream Obama would take advantage of the fact that only the president can fundamentally shift the terms. He'd take advantage of George Santayana's observation that Americans don't solve their problems; they leave them behind.
My dream Obama would abandon the big government versus small government argument. He'd point out that in a mature, aging society, government isn't going anywhere. The issue is not size but sclerosis. The future has no lobby, so there are inexorable pressures favoring present consumption over future investment. The crucial point is not whether a dollar is spent publicly or privately, it's whether it is spent on the present or future. The task today is to reform institutions and rearrange spending so we look like a young nation and not a comfort-seeking, declining one.
My dream Obama would nurture investment in three ways. First, he would take spending that currently goes to the affluent elderly and redirect it to the young and the struggling. He would build on the means-testing Medicare idea that Yuval Levin described recently in the New York Times. Older people with higher lifetime earnings would have fewer benefits, and they wouldn't kick in until age 70.
That money could be used to reduce our children's debt burden and to fund early education, community colleges, research and infrastructure projects. Obama thinks the Democratic base would reject this shift. I'm not so sure. Democratic interest groups generally care more about discretionary spending than entitlement spending for the affluent. Moreover, I think Republicans could be persuaded that it's crazy to harp on discretionary spending, which is a deficit sideshow. They should focus their energies on entitlements.