Feb. 21 (Bloomberg) -- With eight days left before automatic federal budget cuts begin, Republicans and President Barack Obama are spending more time trying to sway public opinion and blaming each other than negotiating an agreement.
Obama and congressional Republicans continued their political messaging feud yesterday, seeking to assign blame to the other party over who would be at fault if the automatic cuts, known as sequestration, take effect.
The approach signals that a deal before the March 1 deadline is doubtful. Instead, the back-and-forth in television interviews and newspaper opinion pieces indicates that lawmakers expect public pressure on Congress and the administration to shape the outcome in the weeks ahead.
“Everybody seems to be resigned that sequester is going to occur,” said former Representative Tom Reynolds, a New York Republican who said Obama’s public campaign against the cuts has given him a short-term advantage over an unpopular Congress. “Just the messengers, between the president and Congress, make it kind of an advantage for the president.”
If Congress doesn’t act, federal spending will be reduced by $85 billion in the final seven months of this fiscal year and by $1.2 trillion over the next nine years. By the end of 2013, inaction would lower the gross domestic product by 0.6 percent and cost 750,000 jobs, according to the non-partisan Congressional Budget Office.
Obama telephoned House Speaker John Boehner and Senate Minority Leader Mitch McConnell today, White House press secretary Jay Carney said. Carney said the president and the two Republicans had “good conversations” while declining to give details.
It was the first time Obama contacted McConnell since New Year’s Eve, said Don Stewart, a spokesman for the Kentucky senator. Boehner spokesman Michael Steel confirmed the conversation took place without providing any other information.
When Congress returns from a recess next week, Senate Democrats are planning a vote on a $110 billion proposal that would end some farm subsidies, impose a 30 percent minimum tax rate on the highest earners and delay the cuts until 2014. That would meet Obama’s requirement that higher taxes for top earners or companies be part of a plan to delay the cuts.
Republicans, meanwhile, want Obama to accept a plan that would lead to a balanced budget within a decade without raising additional revenue. They are seeking to link him to the origin of the across-the-board cuts and make him look inflexible.
“The president’s sequester is the wrong way to reduce the deficit, but it is here to stay until Washington Democrats get serious about cutting spending,” Boehner of Ohio wrote in an opinion article in The Wall Street Journal yesterday. “The government simply cannot keep delaying the inevitable and spending money it doesn’t have.”
The gap between the parties’ positions has led to the public-relations battle and the fiscal stalemate. Republicans control the House and have the ability to block Senate Democrats from acting unilaterally.
So far, public opinion favors Obama. According to a Bloomberg National Poll, 43 percent of Americans blame Republicans in Congress for “what’s gone wrong” in Washington compared with 34 percent who blame Obama and Democrats in Congress. Another 23 percent aren’t sure who to blame, according to the poll, which was conducted Feb. 15-18.
At the same time, Americans disapprove of Obama’s handling of the federal budget deficit by 55 percent to 35 percent.
During budget showdowns in 2011 and 2012 over the debt ceiling and the fiscal cliff, Americans tended to blame Boehner and congressional Republicans rather than Obama, according to Michael Dimock, director of the Pew Research Center.
“The Republicans did take the brunt of the public’s anger,” he said. “People’s default was to see the Republicans as the party unwilling to compromise. I don’t know we’ve seen anything fundamentally different in this instance.”
Republicans are trying to overcome the popularity of a recently re-elected president who can command a national audience. Obama had eight interviews with local television stations yesterday, including broadcasts in Wichita, Kansas, Charleston, South Carolina, and Oklahoma City, Oklahoma, in states won in November’s election by Republican presidential nominee Mitt Romney.
The Republican strategy has focused on the origins of sequestration in mid-2011, in the final days before Congress voted to raise the debt limit. Using the Twitter hashtag “#Obamaquester,” they emphasize that the administration proposed the automatic cuts to ensure the deficit was reduced and to push the need for another debt limit increase until after the 2012 election.
“The House has acted twice to replace the president’s sequester with common-sense cuts and reforms that protect our national security, and it’s why I’ve been calling on the president for more than a year to press his Democratic-controlled Senate to do the same,” Boehner said in a statement yesterday.
Congress should replace sequestration with spending cuts and no new revenue, Republicans maintain, because more than $600 billion in tax increases on top earners took effect last month.
As the public sees the effects of sequestration, Reynolds said, Republicans can overcome Obama’s short-term advantage and focus on the tax increases he’s seeking.
“That is going to be where Congress can begin to have the public say, ‘Jeez. Isn’t there waste, fraud and abuse? Isn’t there other areas’” to cut, said Reynolds, now a lobbyist at Nixon Peabody LLP in Washington.
What Republicans don’t mention are the spending-only budget deals in 2011 that reduced deficits by more than $1 trillion. They play down their votes for the deal that included sequestration, which was designed to meet their requirement that spending cuts equal the size of a debt limit increase.
“Both sides want voters to think that the other side was responsible for it when in fact they both agreed to it,” said Peter Brown, assistant director of the Quinnipiac University Polling Institute, based in Hamden, Connecticut.
Republicans minimize the fact that the Republican-controlled House hasn’t passed a plan in this session of Congress to avert the cuts, though they did pass two bills last year. Republicans say they want the Senate to act first this time.
Democrats, meanwhile, are trying to repeat the public-relations strategy that contributed to House Republicans relying on Democratic votes to pass the year-end tax deal, aid for Hurricane Sandy victims and a short-term debt ceiling increase over the past two months.
Using Obama’s megaphone, they emphasize the importance of a “balanced” approach, saying they’re willing to accept further spending cuts along with tax increases. Jay Carney, the White House press secretary, yesterday mentioned frequent taxation targets such as corporate jets and oil and gas companies, though Senate Democrats didn’t include those items in their bill.
“The key is for them to go ahead to put forward a balanced, responsible approach, that will avoid cuts to things like Head Start programs, medical programs, help for the mentally ill, all these things that have an impact on people’s day-to-day lives,” Obama said in an interview with Boston’s WCVB yesterday.
Democrats play down the origins of sequestration and don’t mention that the Senate, which they control, hasn’t voted on a plan to replace the cuts, except for the two-month delay that was part of the tax-increase law signed by Obama on Jan. 2.
House Democrats today plan to hold an unofficial one-party hearing to draw attention to the potential effects of the cuts on teachers, families and health programs.
Both parties are trying to affix blame before the effects of the spending reductions are seen. Many of the changes won’t be immediate, because agencies had time to conserve money in the first few months of the fiscal year.
That may change if job losses start mounting and as voters encounter reduced service at the federal agencies they interact with most directly. Lines at airport security, longer hold times on Internal Revenue Service toll-free lines and reduced hours at national parks would be noticeable.
Half the cuts would come from defense programs, and the prospect of having less money has contributed to a reduction in contracts. The value of Pentagon contracts announced in January fell by 67 percent from the previous month and by almost half from a year earlier, according to data compiled by Bloomberg.
Ultimately, Carney said, those consequences will make Republicans cut a deal that includes higher taxes, just as they did on Jan. 1.
“The American people supported those positions that the president took,” he said. “And, in the end, Congress responded to the will of the American people. And we hope that’s what’s going to happen again this time.”
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