Washington Post (paywall):
Senior White House officials are discussing a budget strategy that could lead to a government shutdown if Republicans continue to demand deeper spending cuts, lawmakers and Democrats familiar with the administration’s thinking said Thursday.
The posture represents a more confrontational approach than that of this spring, when President Obama decided not to escalate a fight over across-the-board reductions known as sequestration in an earlier budget battle with Republicans.
The change in tone has been evident in repeated and little-noticed veto threats over the past few weeks by Obama, who has rarely issued the warnings with such frequency. He has made it clear that he will not sign into law Republican spending bills that slash domestic programs even more deeply than sequestration.
I'm not sure this is much of a change in substance as it is a change in emphasis. Earlier this year, President Obama said that if Congress passed appropriations bills that were consistent with spending levels in the 2011 Budget Control Act, he would sign them, even though he preferred higher spending levels.
In saying that, the president was also implicitly saying that if Congress cut spending more deeply than the 2011 agreement, he would not sign it. Now that House Republicans have started moving forward with legislation that would violate the 2011 agreement, President Obama is following through on what he had implicitly said.
There is, however, something potentially new:
White House officials also are discussing a potential strategy to try to stop the sequestration cuts from continuing, the lawmakers and Democrats said. Under this scenario, the president might refuse to sign a new funding measure that did not roll back the sequester. No decision has been made.
But some of Obama’s top economic advisers fear that they may not be able to stop what they consider damaging cuts without a sharper confrontation, the sources said. Other advisers are urging a more cautious course, saying it would be better for Obama to seek a more targeted agreement that would increase funding for a smaller set of priorities.
If Obama were to insist on repealing the sequester, it would indeed set up a major confrontation with Congress—and I believe it's a confrontation he would win. The deficit isn't nearly as bad as was during the debt limit crisis in 2011, but the economy still isn't growing fast enough. When it comes to fiscal policy, we really do have to choose between a misguided obsession with deficits or making national investments that will fuel economic growth and security. I wouldn't bet the farm on President Obama deciding to have this fight, but I sure hope he does.