by
Russell Berman Sphere
(Dec. 22) — President Barack Obama’s first year in the White House is ending with a heavy dose of compromise. His administration has given its blessing to the public-option-less health care reform package now inching toward passage in the Senate, which while still sweeping in scope is disappointing to his liberal base. Friday in Copenhagen, he helped hammer out a global accord on climate change that makes progress but lacks the teeth he’d sought.
And those items, however significant, are only two entries on the president’s lengthy agenda. To accomplish his other goals, Obama will likely have to keep up the give and take. A sampling of what his 2010 compromises could look like:
1) A New Jobs Bill
If it’s all the same, they’d prefer you not call it Stimulus II. But the president and his Democratic allies in Congress will vigorously push a jobs bill to try to push the stubbornly high unemployment rate below 10 percent and strengthen the party’s precarious position in advance of the 2010 midterm elections.
What Obama wants: In a speech this month, the president outlined four targets for a jobs package: tax breaks for small business to spur hiring; another infusion of infrastructure spending on roads, bridges and other projects; more aid to low-income Americans, through direct money to states and an extension of unemployment and other benefits; and tax incentives for energy-efficiency initiatives like home weatherization, which has earned the (inevitable) nickname “cash for caulkers.”
What he could get: Aid for small businesses. One of the few remaining things that Democrats and Republicans agree on in Washington is that pledging support for small business is political gold. Extensions of unemployment insurance have become common-place during the recession, so that should also make it into the bill, while a version of the weatherization measure could survive if packaged in the same way as last summer’s popular “Cash for Clunkers” program. The president and Democrats will have more trouble adding additional spending for infrastructure projects. Republicans will argue that with most of the billions of dollars allocated during the first stimulus still unspent, why start spending more already?
2) Financial Regulatory Reform
The president has been accelerating his push for a regulatory overhaul, criticizing Wall Street for opposing more regulation and exhorting Congress to move faster.
What Obama wants: A new Consumer Financial Protection Agency, more power for the Federal Reserve, controls on excessive executive pay, and much stricter oversight of hedge funds and complex financial tools like derivatives, among other items.
What he could get: Despite intense opposition from industry and the U.S. Chamber of Commerce, the new consumer protection agency survived a House vote, though its fate in the Senate is uncertain. Obama will most likely have to stomach more scrutiny — and potentially less power — for the Federal Reserve, which has been subject to a populist backlash led by Rep. Ron Paul, R-Texas. As with health care, Obama should get a bill in the new year, but an aggressive lobbying campaign by Wall Street will have taken its toll.
3) Climate Change Legislation
At some point in 2010, the Senate will consider far-reaching climate change legislation to create new investments in alternative energy and set nationwide limits on carbon pollution. The House passed its version of the bill in June.
What Obama wants: After the yearlong soap opera that was health care reform, the president would probably settle for any kind of Senate vote on a climate change bill. What he would really love — and importantly, what he campaigned on — is a measure that includes an industrywide cap-and-trade program to regulate carbon emissions.
What he could get: Cap-and-trade is fast becoming the climate change version of health care’s “public option.” Republicans have already labeled it “cap-and-tax” and warned of skyrocketing energy costs if it is enacted. Cap-and-trade is included in the House bill, and Democrats will try to keep it on the table as long as possible, but few political observers expect it to pass the Senate.
4) Deficit Reduction
Obama’s biggest looming dilemma is the dual and seemingly contradictory need to boost the economic recovery with government spending while controlling the exploding deficit, which now stands at $1.4 trillion.
What Obama wants: The president has promised to tackle the growing red ink, though he has also warned that deficit reduction will be a goal for the medium and long term, not the immediate future. What that will mean is the creation of a commission to recommend a combination of tax hikes and spending cuts for congressional approval. The White House will want as much say in the panel’s membership as possible, and it would demand that the commission recommendations receive an up-or-down vote in Congress, without being watered down by endless amendments.
What he could get: Momentum is building on Capitol Hill for a debt commission, but how much power it should have is a sticking point sure to produce a fight. The House and Senate will want most if not all commissioners to be sitting members of Congress, and the Democratic leadership is expected to oppose efforts to restrict its ability to alter whatever recommendations the panel makes. A possible compromise would be allowing the commission to work through all of 2010, so the Obama administration and Congress can project the image that they are tackling the deficit without being forced to consider tax increases in an election year.
5) Expansion of Gay Rights
Gay rights advocates who enthusiastically supported Obama in 2008 were among the first to be disappointed in 2009, when he did not move aggressively to end the military’s “Don’t Ask, Don’t Tell” policy.
What Obama wants: The president and his advisers have insisted that he supports ending “Don’t Ask, Don’t Tell,” as well as a repeal of the Defense of Marriage Act, which President Bill Clinton signed into law in 1996. Obama may make a renewed push on either of those efforts at least in part to rejuvenate the Democratic base, which has been deflated by the administration’s compromises on health care.
What he could get: The escalating war in Afghanistan complicates Obama’s desire for a major change in military policy, but ending “Don’t Ask, Don’t Tell” may be the option with more widespread support, including from some Republicans. A push to overturn the Defense of Marriage Act means re-igniting the culture wars in an election year, a move that could be especially risky given the gay rights movement’s recent setbacks in ballot initiatives in California in 2008 and in Maine this November.
What Obama Will Compromise On in 2010
