MICHAEL GOODWIN: Obama's Living In Fiscal Fantasyland

By Michael Goodwin

Elections have consequences, we are told, but the admonition usually refers to how results shape subsequent events. Yet as last week’s huge battle over puny budget trims proved, America already is suffering from an election that is still 18 months away.

Blame President Obama. By waiting until Republicans offered a bold plan to address the staggering debt and deficit problems, then countering with a partisan attack that lacked any serious reforms, he signaled that no major changes will happen until voters speak in 2012.

Indeed, he defined his sketchy financial plan in pure political terms, saying it is “an attempt to clarify the choice that we have as a country right now.”

Like many of Obama’s claims, this one is both technically accurate and not true. Voters have a “choice” only to the extent that they must choose between fantasy and reality.

Obama’s plan resides firmly in the fantasy camp. His vision is that America’s financial problems can be fixed by raising taxes on 2 percent of the population. Everything else will take care of itself, or Congress will do something about it down the road.

His is not a plan as much as it is a placeholder while he tries to rally his party’s ultra-liberal, anti-business base. He is already in cheap populism mode, telling supporters at a Chicago fund-raiser he “reformed Wall Street so you won’t get cheated when you apply for mortgages or take out credit cards.”

Contrast that with the more realistic vision of Republican Congressman Paul Ryan of Wisconsin. While Ryan’s plan, passed Friday by the House, is incomplete and far from perfect, his starting point is honesty: The nation cannot continue on its current path because entitlement spending, especially for health care, will take the country over the cliff. No amount of tax hikes can keep up with the explosion of climbing costs and existing debt, or, as Ryan puts it: “We don’t have a problem with our budget because Americans don’t pay enough taxes. We have problems with our budget because we spend too much money.”

He proposes fundamental changes to save nearly $6 trillion over a decade, including making Medicaid a block-grant program so states can administer it more efficiently. He also proposes a voucher program for Medicare for those under 55. Those already in the program or age 55 and above would not see any reduced benefits.

While both Republicans and Obama are guilty of pushing plans they know the other side won’t accept, they are not equally guilty with regard to the fundamental problem. As Ryan argues, comparing his plan to what exists now, as Obama does, is “measuring us against a fiscal fallacy . . . against a future that’s not going to happen.”

Changes are necessary because the current programs will bankrupt the nation in less than a generation. In fact, some economists warn that a debt crisis could happen in less than five years.

The only choice, then, is what the changes are and how we get there. By failing to be honest about that basic fact and refusing to work now to build a consensus, Obama shows he is willing to forfeit the responsibility of leadership and waste the remainder of his term. Even worse, he intentionally distorts the GOP plan to scare voters.

“Under their vision, we can’t invest in roads and bridges and broadband and high-speed rail,” Obama told the Chicago crowd. “I mean, we would be a nation of potholes, and our airports would be worse than places that we thought — that we used to call the Third World.”

He went on to say: “That’s what the 2012 campaign is going to be about.”

His hard-line stance is an admission that nothing significant will change as long as he is in the White House.

Which is pretty amazing when you think about it: He’s now the candidate fighting to protect the status quo. And Republicans are the Party of change.

True story.

Michael Goodwin is a New York Post columnist.

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