Obama's Achilles' heel.

The history behind current events.
Jan. 29 2010 5:12 PM

Obama's Achilles' Heel

What the deficit-commission idea says about his politics.

The soaring campaign-trail rhetoric of change—to which Barack Obama returned this week, as if it were an old girlfriend, in his State of the Union address—has always rested on a faith in transcending factional interests. Since the 19th-century Mugwumps and the early-20th-century Progressives, reformers have placed hopes for building a new consensus in the high-minded invocation of a common good. Self-interested and partisan jockeying for advantage, they insist, corrupts Washington politics and impedes progress.

But constructing an environment free from those pressures of self-interest has always proved to be the Achilles' heel of this political outlook. In a campaign speech—or in a campaign book like The Audacity of Hope—calls to let go of partisan attachments in favor of unifying compromises can easily flourish. But in the halls of Congress, or in the ever-more partisan news media, devotion to interest or ideology invariably reasserts itself and renders the middle ground treacherous.

In his State of the Union speech, Obama nonetheless stated his intent to try to build just such an environment—a politics-free zone in which technocrats and statesmen could tackle a major policy problem without fear of electoral repercussions. Specifically, he said he would issue an executive order creating "a bipartisan fiscal commission, modeled on a proposal by Republican Judd Gregg and Democrat Kent Conrad," focused especially on restraining "the cost of Medicare, Medicaid, and Social Security."

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Pundits like to recall the 1982-83 Social Security Commission, led by Alan Greenspan, that's believed to have saved the retirement insurance program from bankruptcy. But that historical example is misleading. Not only did the Greenspan commission do less than is commonly supposed, as Jackie Calmes of the New York Times recently wrote; it's also an atypical case, an exception that proves the rule. A more representative example of the bipartisan deficit-reduction commission is the once-hyped, now-forgotten National Economic Commission—a Reagan/Bush-era venture that promised but failed to address what was then seen as a paramount and crippling economic issue. (Its history was first recounted in an article in the Washington Post in October 1992 by Bob Woodward, with assistance from this writer, then a cub reporter.)

When Ronald Reagan's experiment in supply-side economics—cutting taxes, raising defense spending, and expecting federal revenues to surge—went awry, unprecedented budget deficits threatened to cripple the American economy. (Some economists thought the 1987 stock market crash, at the time seen as calamitous, occurred because deficits had grown untenable.) Inspired by the 1983 Greenspan Commission, New York Gov. Mario Cuomo began talking up the idea of a panel that could give politicians the needed cover to do what he said they all privately acknowledged had to be done: cutting defense spending, Medicare, and Social Security while raising taxes. One convert across the aisle was Senate Minority Leader Bob Dole—known as a lifelong deficit hawk until his campaign-year embrace of supply-side economics in 1996—who provided for the commission's creation in a budget bill that Reagan signed during his last year in office.

The commission comprised the usual bipartisan complement of centrist eminences, including Felix Rohatyn of Lazard Freres, Lee Iacocca of Chrysler, Bob Strauss of Akin Gump, Sens. Daniel Patrick Moynihan and Pete Domenici (for whom a seat on every deficit-reduction commission seems to be permanently reserved). In a short time span, virtually all the members agreed to yield on some areas where their party or ideological interests normally resisted: Democrats capitulated on trimming Social Security, Republicans on shaving defense outlays. "It was also clear that to strike a political compact would require some taxes," said commission member Donald Rumsfeld, then a relatively uncontroversial figure presumed to be retired from government service. The trick was they all had to hang together. If a few members rejected the consensus, it would leave anyone who stuck to the compromise—especially the elected officials—vulnerable.

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