May 24, 2013

Analysis: A deep divide over the nation’s course ahead

e03c8d4dc79f05855336dd66c80cc6b2 Analysis: A deep divide over the nations course ahead

(Phatforums News / ) — TAMPA – President ’s populist-flavored Address on Monday night and the harsh reaction of Republican leaders to it reflect more than Washington’s typical partisan divide.

Their sharply divergent views about the causes of the country’s problems and the solutions to them are part of the most fundamental debate in a generation or more, perhaps even since the New Deal era, over what the government can and should do at a time of economic pain.

That deep disagreement isn’t likely to be narrowed before November.

PHOTOS: 2012 State of the Union
BLOG: Highlights from the president’s speech
MORE: Readers weigh in on state of the U.S.

The gulf between the two sides and the capital’s partisan undercut the traditional role of the State of the Union — that is, as an account of the legislative priorities the president will pursue this year. Instead, with limited prospects of major legislation passing, the speech and the reaction are election-year arguments that each side hopes will persuade voters to endorse its view of the world.

In his address to a , Obama portrayed the Republicans as advocates of what he has called “you’re-on-your-own economics,” determined to protect the wealthy at the expense of everyone else.

“We can either settle for a country where a shrinking number of people do really well while a growing number of Americans barely get by,” Obama declared, “or we can restore an economy where everyone gets a fair shot, everyone does their , and everyone plays by the same set of rules.”
Speech transcripts

President Obama: State of the Union Address
Indiana Gov. Daniels: GOP response

Republicans accused Obama of promoting and stoking the politics of envy.

“No feature of the Obama presidency has been sadder than its constant efforts to divide us, to curry favor with some Americans by castigating others,” Indiana Gov. Mitch Daniels said in the formal Republican response. “We Americans are all in the same boat.”

Earlier in the day, at an overflow rally in Sarasota, Fla., presidential hopeful Newt Gingrich derided Obama as “a Saul Alinsky radical,” a reference to an iconic Chicago community organizer. Mitt Romney, campaigning here in front of a banner that said “Obama isn’t working,” described the president as an economic naif who wants to transform the United States into “a European-style social welfare state.”

The task for a first-term president delivering his fourth-year State of the Union always requires striking a delicate rhetorical balance, especially at a time of travail, between bragging about achievements and acknowledging setbacks. In his 1996 address — after his party suffered historic losses in the 1994 midterms —President Clinton said “the era of big government is over,” drawing more applause from Republicans than fellow Democrats.

In his 2004 State of the Union, President George W. Bush focused in large part on the aftermath of the Sept. 11 attacks, saying “America is on the offensive” against terrorists and declaring victory over Saddam Hussein. “The people in Iraq are free,” he said.

GOP candidates respond

Here’s what the Republican presidential contenders said Tuesday about President Obama and the State of the Union. Rep. Ron Paul did not make public appearances Tuesday.

Mitt Romney: “Tonight will mark another chapter in the misguided policies of the last three years, and the failed leadership of one man. But Americans know that our future is brighter and better than these troubled times.”

Newt Gingrich: “A friend of mine says, ‘He has shifted from Yes We Can to Why We Couldn’t.’ ”

Rick Santorum: “You are going to hear a bunch of flowery rhetoric and all this stuff about all the things he has done. But what he has done? He has grown the tax burden on the American public through Obamacare, through Dodd-Frank [Wall Street overhaul law] and through other bills. He has grown the size and scale of government to an unprecedented level. He has grown the deficit in this country to absolutely immoral lengths.”

Contributing: The Associated Press, CBS News

This time, Obama blamed the nation’s woes on the policies of his predecessors.

“Long before the recession, jobs and manufacturing began leaving our shores,” he said. “Folks at the top saw their income rise like never before, but most hardworking Americans struggled with costs that were growing, paychecks that weren’t and personal debt that kept piling up. In 2008, the house of cards collapsed.” (That would be before he was inaugurated in January 2009.)

Romney blamed the president’s own policies for making “these troubled times last longer,” mentioning in particular Obama’s signature health care overhaul — “a -dollar entitlement we don’t want and can’t afford” — and curbs on domestic energy production.

When it comes to what to do now, Obama proposed tax changes to encourage manufacturing jobs, steps to encourage natural-gas production, and the use of half of the “peace dividend” from winding down wars in Iraq and Afghanistan to invest in infrastructure. He also embraced the principle that millionaires and billionaires should have to pay an effective income-tax rate of 30%.

Speaking for the Republicans, Daniels called for a simpler tax system and “a pause in the mindless piling-on of expensive new regulations that devour dollars that otherwise could be used to hire somebody.” He derided what he called “the extremism that stifles the development of homegrown energy, or cancels a perfectly safe pipeline that would employ tens of thousands.”

That was a reference to Obama’s decision against allowing the Keystone XL pipeline to be built to carry oil from Canada to the Gulf of Mexico. To underscore the point, House Speaker John Boehner, invited three officials from energy companies affected by the decision to sit in the House gallery.

Sitting with Michelle Obama was billionaire investor Warren Buffett’s secretary, Debbie Bosanek, to personify the president’s call for “the Buffett rule,” aiming to make the wealthy pay tax rates higher than their employees who make much less.

The image of the two sides on opposite sides of the aisle may no longer be adequate to illustrate their divide.

Harvard economist Kenneth Rogoff says they seem to be operating in separate worlds. “The whole debate has a men-are-from-Mars, women-are-from-Venus feel to it,” he says, raising questions about realities each side overlooks.

“The debate over the role of government in our economy is as acrimonious as it’s been since the 1930s,” reflecting the severity of the Great Recession, says Mark Zandi, chief economist at Moody’s Analytics. “It is such a fundamental debate, it needs to be ultimately decided by the American people on Election Day.”

Obama to lay out debt reduction plan

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U.S. President Barack waves after his address to a joint session of Congress in the House Chamber of the U.S. Capitol February 24, 2009 in Washington, DC. In his remarks addressed the topics of the struggling U.S. economy, the budget deficit, and health care. (Photo by -Pool/Getty Images) *** Local Caption *** Barack
(February 24, 2009 – Photo by Pool/Getty Images North America)

NEW YORK () — President Obama’s is set to land Monday in the of the 12 members of the Congress’ bipartisan debt committee.

In recent weeks the president has said his plan would offer specific proposals that can achieve savings “more ambitious” than the committee’s $1.5 . He said it would be “balanced,” involving both spending cuts and tax increases. And he promised it would “stabilize debt in the long run.”

But those phrases offer wide berth for interpretation.

“Ambitious is in the ,” said longtime budget expert Stan Collender. “[Is it] ambitious because you use the word ‘Medicare’ twice in your proposal? Or is it ambitious because you call for savings over eight years instead of 10?”

What seems a sure bet, though, is that Obama’s plan won’t satisfy everyone.

Democrats will want him to go light on entitlements, especially since many felt the president caved too easily in failed debt negotiations with Republicans this summer. And they’ll want to see tax increases on high-income earners.

The wants to hold the line against any revenue increases and instead lean solely on spending cuts.
Debt committee urged to ‘go big’

And serious fiscal experts, meanwhile, know that meaningfully and credibly reducing the debt will require crossing everyone’s .

What “ambitious” may mean: Back in April, Obama released a debt reduction framework that would save $4 trillion over 12 years.

That’s the minimum amount fiscal experts say is needed to stabilize debt as a percentage of the economy over a decade.

What most observers expect is that his plan on Monday will top the debt committee’s $1.5 trillion, but by how much isn’t clear.

“Three trillion would be tremendous,” said Maya MacGuineas, president of the nonpartisan Committee for a Responsible Federal Budget.

But hitting that target almost certainly means tackling entitlements and tax reform. And in both cases expectations aren’t high.

Obama promised in his jobs speech last week that his plan would include “modest adjustments to health care programs like Medicare and Medicaid.” Some have taken that to mean that he may recommend savings in the program’s administration and payment reimbursement rather than changes to benefits directly.

Recently the White House has made clear that the president’s plan will not include Social Security.

“It is not a driver of our near-term deficit problems, and it can be pursued on a parallel track,” White House spokesman Jay Carney said Thursday.

Many Democrats’ blood pressure will hit the roof if Obama proposes raising the eligibility age for Medicare

Fiscal hawks, on the other hand, would applaud an increase in the retirement age for both Medicare and Social Security because if done gradually and in a way that protects workers in physically demanding jobs, it’s a comparatively easy way to contribute to the programs’ long-term solvency.

In terms of tax reform, the president may outline what he could support but without many specifics. If he offers any, said Sean West, a U.S. policy analyst at Eurasia Group, he might endorse a reduction in top marginal tax rates to roughly 28% for individuals and corporations in conjunction with the elimination of many deductions and credits.

Clint Stretch, managing principal of federal tax policy at Deloitte Tax, doesn’t think the plan will offer anything but the broadest guidelines for tax reform. Instead he thinks the president will continue to recommend that many of the Bush-era tax cuts be allowed to expire for high-income households, which could raise about $700 billion or so over a decade.

“I’m not expecting a heavy lift,” Stretch said.

How the debt committee may react: Expectations aren’t high that the president’s plan will alter the already difficult politics facing the super committee.

Indeed, Collender — who is very pessimistic about the group’s chances for success — thinks the only way it may have an effect is if “he goes really big on Medicare, Medicaid and Social Security.” Otherwise, he said, the members are likely to look at Obama’s proposal and say, “Thanks very much, we’ll get back to you.”

But even if it doesn’t alter the committee’s deliberations, West thinks the president’s plan will “take on an importance for laying the groundwork for the types of provisions a second-term Obama will seek in a deficit grand bargain in 2013.” To top of page

Mid-East: Obama and Netanyahu to hold Washington talks

44a5e936b49dd252d2372b6f34f007ca Mid East: Obama and Netanyahu to hold Washington talks

(Phatforums Blog/ BBC News) – US President is to meet Israeli Netanyahu in Washington shortly amid sharp differences on the way forward for the process.

Mr has said a future Palestinian state must be based on the borders that existed prior to the 1967 war.

He said “mutually agreed swaps” would help create “a viable Palestine, and a secure Israel”.

But said the pre-1967 borders were “indefensible”.

An estimated 500,000 Israelis live in settlements built in the West Bank, which lies outside those borders.

The settlements are illegal under international law, although Israel disputes this.

In a on Thursday on the future of US policy in the Middle East, President Obama said: “The United States believes that negotiations should result in two states, with permanent Palestinian borders with Israel, Jordan, and Egypt, and permanent Israeli borders with Palestine.

Analysis
Wyre Davies BBC News, Jerusalem

In many ways the Israeli Prime Minister, Benjamin Netanyahu, should be a man content with his lot. He is on a high- to Washington where he will be met with a firm handshake and warm words from President Barack Obama.

In a historic address to a joint-session of Congress next week, he can expect to be repeatedly applauded as he describes how his government tirelessly searches for peace.

And at the annual conference of Aipac – the American pro- – he will be feted as a hero and beacon of light in an otherwise hostile region.

But at home, in a dramatically changing Middle East, the appears increasingly out-manoeuvred and out of step with the attempts of others to resolve the frustrating and long-standing stalemate in the .

Pressure heaped on Netanyahu

“The borders of Israel and Palestine should be based on the 1967 lines with mutually agreed swaps, so that secure and recognised borders are established for both states.”

In a statement, Mr Netanyahu’s office said he appreciated Mr Obama’s “commitment to peace” but that for peace to endure, “the viability of a Palestinian state cannot come at the expense of the viability of the one and only Jewish state”.

The statement called on Mr Obama to reaffirm commitments made to Israel by the US in 2004.

“Among other things, those commitments relate to Israel not having to withdraw to the 1967 lines which are both indefensible and which would leave major Israeli population centres in Judea and Samaria beyond those lines,” it said.

“Those commitments also ensure Israel’s well-being as a Jewish state by making clear that Palestinian refugees will settle in a future Palestinian state rather than in Israel.”

One Israeli official travelling to Washington on the plane with Mr Netanyahu said: “There is a feeling that Washington does not understand the reality, doesn’t understand what we face.”

‘Arab Spring’

The BBC’s Wyre Davies in Jerusalem says that while Mr Netanyahu will be warmly welcomed in the US, he is coming under increasing international pressure to ease his objections to a Palestinian state following the unity deal signed between rival Palestinian groups Hamas and Fatah earlier this month.

If the unity project holds, says our correspondent, Mr Netanyahu could find himself foundering while other countries embrace fresh Palestinian initiatives.

Israel’s claim to being the only democratic state in the region has also been undermined by the dramatic developments of the “Arab Spring” anti-government uprisings, our correspondent adds.

db1849a7f37482b63573d47e22f683dd Mid East: Obama and Netanyahu to hold Washington talks

Map

Obstacles to peace: Borders and settlements
Mid-East media lukewarm on Obama speech

The push for democracy began with the overthrowing of Tunisian President Zine al-Abidine Ben Ali in January. Egyptian leader Hosni Mubarak was later toppled in Egypt, with demonstrators in Libya currently working to overthrow Muammar Gaddafi.

Similar uprisings are also taking hold in Bahrain, Yemen and Syria.

The Palestinian leadership is split between the Palestinian Authority, which is dominated by the Fatah political faction and governs the West Bank, and the Islamist movement Hamas, which runs the Gaza Strip.

Palestinian Authority President Mahmoud Abbas is due to meet colleagues to decide on the next move, with senior officials saying they have been ordered not to speak to reporters beforehand.

A senior member of Hamas, Foreign Minister Mohamed Awad, told the BBC that tangible steps were needed from the US president, not mere slogans.

“Obama didn’t say anything about the suffering of the Palestinian people, who are suffering for more than 63 years,” he said.

“He didn’t say that the peace process had already reached a dead end… He tried to please everyone but he didn’t try to please the Palestinian people.”