President Obama wrapped up his bus tour with
a town hall in Alpha, Illinois on Wednesday
President Obama,
Wednesday afternoon at a town hall in Alpha, Illinois:
Over the course of the next few weeks, I’m going to be putting out more proposals to put people to work right now. And some of them—yes, some of them cost money. And the way we pay for it is by doing more on deficit reduction than the plan that we had to come up with right at the last minute in order to avoid default. We didn’t do as much as we could have.
When folks tell you that we’ve got a choice between jobs now or dealing with our debt crisis, they’re wrong. They’re wrong. We can’t afford to just do one or the other. We’ve got to do both. And the way to do it is to make some—reform the tax code, close loopholes, make some modest modifications in programs like Medicare and Social Security so they’re there for the next generation, stabilize those systems. And you could actually save so much money that you could actually pay for some of the things like additional infrastructure right now.
We can close the deficit and put people to work, but what’s required is that folks work together. That’s the big challenge. That’s the big challenge. (Applause.)
So the main thing is I’m here to enlist you in this fight for America’s future. I need you to send a message to your members of Congress, to your representatives that we’re tired of the games. We’re tired of the posturing. We don’t want more press releases. We want action.
From a policy perspective, this doesn't make any sense. Sure, you could enact long-term deficit reduction at the same time as you pass a short-term jobs bill, but it's the jobs bill that will create jobs—not the deficit reduction package. And if you reduce the deficit too quickly, you'll actually weaken the impact of the jobs bill.
So what we're looking at here is basically a political gambit. President Obama is betting that getting a big deficit reduction package enacted will give him the political capital to force action on a serious jobs creation package. I'd love to be proven wrong, but everything we've seen since Republicans took control of the House says that's a complete fantasy.
It's possible that President Obama could use the threat of a veto to force the super committee to extend the payroll tax cut and unemployment benefits in addition to effectively ending the Bush high-income tax cuts. If he did that, the super committee could end up having done some decent stuff. But extending the payroll tax cut and unemployment benefits falls into the "do no harm" category of policymaking. They don't represent a major new jobs creation initiative.
Unfortunately, even that scenario is wishful thinking. If President Obama continues to link his jobs creation package (whatever it ends up being) to a major long-term deficit reduction package, what will probably happen is that we'll end up with a deal that has lot of the latter, and almost none of the former and it will have President Obama's name stamped all over it, neutralizing his ability to push for any additional jobs creation measures.
If we weren't dealing with a totally unreasonable Republican Party, linking jobs and fiscal policy might be an effective political strategy for getting both done. But the GOP isn't reasonable—and this isn't a time to play political chess.