Who’s Winning The Budget War?

Kimberley A. Strassel
Wall Street Journal

Republicans are forcing Democrats to acknowledge that voters want spending reform.

Here’s the Washington headline of the week that nobody in America got to read: Paul Ryan, 40. Barack Obama, 0.

Forty is the number of Senate votes that went in favor of Mr. Ryan’s reformist budget, a tally that included nearly every Senate Republican. Zero is the number of votes President Obama got for his own tax-and-spend budget, a blueprint that not one of his own party had the backbone to support. It went down, 97-0.

Washington is in a game of high-stakes chicken over raising the debt limit, though so far only one side is flinching. According to the headlines (and Democrats), Republicans are on defense over Mr. Ryan’s plan, are risking America’s creditworthiness, and are delaying sensible compromise by refusing tax increases. It is only a matter of time, goes the betting, before the party swerves.

This has little relation to reality, in which it is Democrats who keep calling their own bluffs. It was Mr. Obama who first swerved, submitting a “do-over” of his initial, embarrassing budget. It is Democrats who have since swerved on the debt-limit debate, agreeing to spending-cut negotiations, then continuing to up the size of a package.

By refusing to blink, Republicans keep forcing Democrats to acknowledge a very simple political reality: Voters do want spending reform, and do not want tax hikes. That’s why this debate has so far moved in the GOP’s direction.

The White House’s first bluff was its argument that America would crater if the GOP did not immediately hold a “clean” debt limit vote, allowing the administration to continue freely borrowing — no spending-reform attached. Treasury Secretary Timothy Geithner was betting markets would respond to his public warnings and exhibit some turmoil in fear of “default.”

The GOP instead refused to back down, and Treasury keeps finding money to make payments. The markets have concluded that nobody will actually allow a default, and interest rates haven’t budged. If anything, financial players are in line with a recent Washington Post poll showing far more Americans worried about America’s debt levels than about an immediate risk of default.

These stats are why the White House swerved from its “clean” vote demand and dispatched Vice President Joe Biden to negotiate spending cuts. It’s why Democrats have gone from insisting they couldn’t cough up more than a few hundred billion to Mr. Biden this week floating a $1 trillion figure.

It’s also why Democrats are cringing from the very “clean” vote they once demanded. “I will not vote for a clean debt limit extension if no Republicans vote for it and instead use it just to demagogue,” complained Democratic Minority Whip Steny Hoyer. Democrats were happy to demand a clean vote when they hoped to scare Republicans into voting with them. They aren’t so keen to go it solo in favor of more borrowing and no reform.

Now comes the bluff that Republicans risk derailing negotiations if they don’t agree to “revenue” (Democratic code for “tax hikes”). Obama National Economic Council Director Gene Sperling insists House Republicans are completely “isolated” on this issue. “Serious people doing serious discussions do not take an absolutist position that you cannot have a penny of revenue,” he said.

Really? If tax hikes are so serious, presumably serious Senate Democrats would this week have finally put out a serious budget, outlining their serious tax hikes.

They didn’t. They instead swerved and took the punk route of all voting against Mr. Ryan’s plan. That’s because serious Senate Democrats have worked out that the only way to get the “revenue” they need to cover their spending is to seriously hit up the middle class. And with 23 seats up for re-election, no serious Senate Democrat wants to go on the record voting for that. Seriously. Unless they can scare Republicans into going along with them.

This week’s GOP loss of a special election in New York (which revolved around Mr. Ryan’s reform) has reinforced another Democratic bluff—that any discussion of entitlement reform is politically “toxic.” The left knows entitlements are where the big spending reforms are, and they are eager to get them off the negotiating table.

Yet the GOP once again refused to swerve. One day after the special-election loss, nearly every Senate Republican voted for Mr. Ryan’s plan. Democrats, by contrast, didn’t have the pluck to cast one vote for their president’s reform-less plan.

Such abdications are beginning to gain notice. On NBC’s “Meet the Press” last weekend, host David Gregory put this to ranking House Budget member Chris Van Hollen: “[Mr. Ryan] is saying, accurately, that you Democrats don’t have a plan, and we have a budget crisis.” Mr. Van Hollen was left to stumble on about “some” Democratic reforms, such as to “incentivize” more “value” in health care.

Republicans should know this: Nobody would even be asking these questions of Democrats if the GOP had blinked.

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