At watershed, Obama caught in the middle on depth of his budget cuts

President Obama’s budget will be dramatically different than his previous ones.

Liberals are already wincing, and congressional Democrats will oppose many of the president’s demands.

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Obama’s presidency has reached a watershed. Despite administration denials, it is widely agreed that Republican triumph in November’s election have spurred Obama to march right into centrist territory, especially on fiscal issues. Today’s budget is intended to suggest a business-friendly executive attacking a crippling deficit.

Most Democrats backed Obama’s previous budgets. This year, the left will rip him for excessive cuts, while the right will claim he hasn’t gone far enough.

The response to leaked details suggests Democrats face weeks of intraparty bickering.

Some fume over $400 billion in expected domestic cuts just two months after Obama inked a deal with Republicans to extend Bush-era tax rates for even the highest income earners and to exempt multimillion-dollar inheritances from taxation.

Democrats say these cuts will hurt the less well off and that Obama is caving without a fight.

They hate a proposed $2.5 billion cut in home energy assistance for the poor. Senate Majority Leader Harry Reid (D-Nev.) said Friday that he wasn’t “a big fan,” which is a polite way to say he thinks it stinks.

Sen. John Kerry (D-Mass.) wrote Obama to oppose the cut, and Rep. Edward Markey (D-Mass.) said it would “have a devastating effect on millions of American families.”

Meanwhile, Budget Director Jacob Lew has disclosed plans to cut community action programs from $700 million to $350 million. “That hits the most vulnerable, poorest people in our country. That can’t stand,” lamented Sen. Tom Harkin (D-Iowa), head of the Senate Appropriations subcommittee with jurisdiction over labor, health and education.

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“There can be pain, but I want to make sure it’s not just on them. I want to make sure there’s Wall Street pain, there’s Pentagon pain, that there’s wealthy pain,” he added.

Ohio Rep. Marcy Kaptur, the second-ranking Democrat on the House Appropriations Committee, said Obama is bowing to Republicans.

“His people aren’t giving us a very wise set of choices,” she said. “They’re cotton-balling rather than hard-balling. He keeps waiting for Congress to save him. He ought to save himself.”

But many a liberal knows that Obama, despite their mounting disappointment in him, is their chief bulwark against deeper cuts that House Republican leaders propose.

Robert Borosage, co-director of Campaign for America’s Future, said, “Most of the groups are girding for what will be a brutal battle with the Republican Congress. As tight as the president’s budget will be, it’s nothing compared to what the Republicans want.”

Still, liberal activists warn that Obama risks losing a motivated base for his reelection bid.

“The great bulk of progressives are not happy with the course of action the administration is taking, but we also understand the political realities,” said Alan Charney, policy director at USAction, a grassroots group.

“The more the base sees the administration is fighting the fight, the more motivated we’re going to be to work for the president,” he said.

Many Democrats see no reason for any concessions, particularly as the economy recovers. “For the most part, we haven’t seen anybody disturbed by [the debt], especially the Chinese and others who are buying our bonds,” said Rep. Henry Waxman (Calif.), ranking Dem on the House Energy and Commerce Committee.

A coalition of liberal groups has been meeting to figure out how to limit losses. They lobbied successfully to steer Obama away from using his State of the Union address to call for a higher Social Security retirement age or other benefits cuts.

To limit the Dem backlash, Obama has in turn sent lieutenants to Capitol Hill to warn Democrats to prepare for a shock. A member of the Democratic House leadership told The Hill that dismay would be “not just on the left, but throughout the party.”

Lew last week met with the House Democratic Caucus. “He indicated that they made some very tough decisions and some people aren’t going to like [it],” said Rep. Chris Van Hollen (Md.), ranking Democrat on the Budget Committee.
Van Hollen said he supports Obama’s five-year spending freeze on federal pay but might oppose specific cuts.

Gene Sperling, National Economic Council director, delivered a presentation to Senate Democrats at their retreat last week in Charlottesville, Va.

Senate Democrats, as the majority in their chamber, are the ones who must do the cutting. Senate Budget Committee Chairman Kent Conrad (D-N.D.), who will not seek reelection in 2012, is ready to oblige and delivered what one colleague called a “sobering” message to Dems at the retreat.

“There is no choice,” Conrad told The Hill afterward, “Our debt is completely unsustainable, and it threatens future economic growth. It threatens the economic security of the country, and it has to be dealt with.”

Senate Dems pin their hopes on targeted rather than across-the-board cuts.

“You have multiple programs for job training [and] to encourage people to go to college,” Conrad said. “There’s a lot of overlap, unnecessary duplication.”

Dems hope eliminating redundancies, axing $20 billion in subsidies for oil companies and $1.1 billion in tax earmarks and increasing the $78 billion of proposed defense cuts over the next five years, might even allow some increased spending elsewhere, such as on the National Institutes of Health, the National Science Foundation and infrastructure development.

Many congressional Democrats also see big savings in accelerating U.S. troop withdrawals from Afghanistan. Obama’s start date for drawdown is July, but he says combat missions will continue through 2014.

Most lawmakers awaiting Obama’s third budget know that such suggestions are grasping for straws. They understand that the fiscal reckoning is upon them. They know the knife is going to cut; the questions are where, and how deeply? And will it also sever ties between the president and his supporters?

“There’s going to be a lot of wailing and gnashing of teeth,” said Sen. Mark Udall (D-Colo.), “and I’m probably going to do some of it too, because it’s stark, it’s brutal.”

This article was revised at 10:15 a.m.