One way to judge the merits of the budget Barack Obama unveiled this week is by the comments of his political allies. "It's not enough to focus primarily on the non-security discretionary part of the budget," said Senate Budget Committee Chairman Kent Conrad.
Erskine Bowles, the Democrat whom Obama appointed as co-chairman of his fiscal commission, said the budget goes "nowhere near where they will have to go to resolve our fiscal nightmare."
"The president punted," began the editorial of The Washington Post, which endorsed Obama in 2008. The paper noted tartly that he "chose to duck" the fiscal commision's recommendations.
"I don't need to tell you what I think of the budget: It's disastrous," wrote Atlantic economics blogger (and Obama voter) Megan McArdle. "I'm starting to think it's time to panic."
There was a little countervailing opinion, but not much. The New Republic's Jonathan ("I hate George W. Bush") Chait headlined his comment, "Why Obama's budget is OK." He thinks it might be a successful political ploy.
In his Tuesday press conference, Obama was reduced to calling for "patience" and saying he wanted to have an "adult conversation" with Republicans on entitlement spending.
To understand what may be ahead, it's useful to distinguish between budgets for three periods -- fiscal year 2011, fiscal year 2012 and the out-years thereafter.
For fiscal year 2011, which began last Oct. 1, the government is now being funded by a continuing resolution that expires on March 4. House Republican leaders initially promised to cut that by $57 billion, arguing that that fulfilled their campaign promise to chop $100 billion since the fiscal year is already five months old. But the freshmen objected, and the leadership agreed to cut the full $100 billion.
The conventional wisdom is that the parties won't be able to agree on funding levels for the remainder of fiscal 2011. This could result in a government shutdown, like the one that occurred in 1995-96 when Bill Clinton and Newt Gingrich failed to agree on terms for continuing to fund government operations.
That was supposedly disastrous for the Republicans. Actually, it worked out well both for Clinton and for House Republicans, who lost only nine seats in 1996 -- a lot fewer than the 63 that the Democrats lost last November. Moreover, in 1995-96, we had healthy economic growth and the case for cuts was much weaker. Now there's a much stronger argument that we can't afford the increased spending Obama and Nancy Pelosi produced in 2009-10.
In Honor of His 103rd Birthday, Here Are The 20 Best Quotes From The Late, Great Milton Friedman | John Hawkins