High-stakes negotiations force people to reveal what they really care about, and in the 11th-hour deal to stave off a federal financial default, President Obama and congressional Democrats and Republicans each made clear their top priorities. For Republicans, it was preventing any tax increase to upper-income families.For Democrats, it was ensuring no cuts to Social Security, Medicaid and a handful of other programs that aid the elderly and the poor.
And for Obama, it was getting a deal that would end the threat of an economy-shaking default until after the 2012 presidential election.
None of the key players was willing to go all out to actually solve the nation’s long-term financial problems. As a result, the deal doesn’t, said the Los Angeles Times in an analysis Tuesday.
Over the next two years, the final compromise comes very close to the initial request by Obama a “clean” debt ceiling increase that allows the government to pay its bills and does nothing else.
In the government’s 2012 fiscal year, the cut would be $21 billion, or less than 1% of a nearly $3.7-trillion federal budget, according to the Congressional Budget Office.
The bulk of the projected $2.1 trillion or more of cuts does not start kicking in until after the next election when a future Congress and president could choose to rewrite the plan a point that many conservatives have worried about.
“Enforcement is the key to whatever we do. It’s always in the out years and it never happens,” said Sen. Michael D. Crapo (R-Idaho), using the budget lingo for the latter years of a long-term deal.
The bill almost certainly defers until after next year’s election the central choice most budget experts say the country eventually must make: higher taxes or deep cuts in Medicare, the nation’s huge and fast-growing health program for the elderly.
What the agreement leaves unaccomplished will remain high on the agenda of whoever is elected preisdent in November 2012. The George W. Bush-era tax cuts will expire barely two months after the election, virtually guaranteeing a new debate over taxes. And whoever takes the oath of office in January 2013 will inherit a debt still rising and another debt ceiling vote just a few months away.