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1995 Federal Budget Debate Is Repeating Itself

I honestly can’t remember the last time a president’s budget received anything but very harsh criticism from the moment it was released, and I’ve been involved in or commenting on the federal budget debate for more than three decades. So it was hardly a surprise when President Barack Obama’s fiscal 2012 budget was skewered as soon as it went public last week (and in some cases, even before). Indeed, it would have been shocking if, given Washington’s toxic partisan atmosphere, a document as political as the president’s budget somehow managed to be well-received.

As with much of what’s happening this year on the budget, the debate over spending, revenues and the deficit that took place in 1995 when Republicans took control of the House and Senate just two years after Bill Clinton was elected president provides some lessons and perspective.

After the elections but before the new Congress convened, Rep. John Kasich (R-Ohio), who would become the chairman of the Budget Committee, repeatedly said his party didn’t care whether Clinton submitted a fiscal 1996 budget. The 1994 elections had rendered Clinton and his budget irrelevant, Kasich said. Republicans had their own budget plans; they were going to move ahead before the Clinton budget was sent to Capitol Hill and by the time the White House released its budget the debate would already be too far along for it to be considered. In other words, the soon-to-be-anointed GOP budget chief was criticizing the president’s plan not just before it was released but before the White House had finished working on it.

In spite of the macho bravado, Kasich and the new Republican majorities in the House and Senate did wait for Clinton’s budget before starting their deliberations. Simple logistics had something to do with it: There’s no owner’s manual for how to run the House or Senate, and it always takes more time and effort than the new majority expects to figure out how to make things work. But the far more important reason was that the GOP leaders realized they would be at a political advantage if the president went first: They would be able to criticize his proposals and then offer an alternative that would be better received.

Clinton thwarted the GOP plan, however, by proposing a budget that didn’t go as far or include as many spending cuts as the Republicans had anticipated. As a result, they could only criticize Clinton for what he didn’t do, which is much harder and usually gets less traction, and they were stuck with being the ones who had to propose the politically difficult budget cuts. That gave the White House an advantage that carried though until November, when a clash between the administration and then-Speaker Newt Gingrich (R-Ga.), then-Majority Leader Dick Armey (R-Texas) and Kasich led to the first of two federal government shutdowns.

It’s nearly impossible not to see the current situation as a repeat of 1995. Current House Budget Chairman Paul Ryan (R-Wis.) didn’t tell the White House not to bother with a budget because the 2010 elections had rendered it irrelevant, but Obama’s fiscal 2012 budget, like Clinton’s for fiscal 1996, didn’t include the big changes that Congressional Republicans were expecting. Just like 1995, the GOP was forced to criticize what the president didn’t do rather than the specific cuts in entitlements that, had the White House proposed them, would have made Republican political lives much easier over the next few months.

Ryan and Speaker John Boehner (R-Ohio) last week both said House Republicans will produce their own budget that will include the significant spending cuts in entitlements that they had expected the White House to propose. The GOP budget proposals in 1995 allowed Clinton to look moderate. To the voters whose programs were most at risk under the GOP’s budget plans, Clinton became the most trusted person to deal with the situation. That same opportunity may now exist for Obama.

There are obvious differences between the 1995 budget debate and the one that has just started, and the outcome definitely isn’t guaranteed to be the same. The most glaring distinction is that Republicans controlled the Senate in 1995, but Democrats hold the majority today. In addition, the tea party didn’t exist in 1995 so the spending cuts that were political dynamite then may be more acceptable now, at least to one segment of the population. The percentage of Americans who identify themselves as independents is also much greater now. And, of course, the deficit is much higher and more commonly acknowledged as a problem today than it was then.

Nevertheless, it is still very hard not to be struck by the extraordinary similarities between the fiscal 2012 federal budget debate and the debate that took place 16 years ago. That deserves careful reflection, particularly because one prime aspect of the 1995 debate — the government shutdown — could happen again in less than two weeks.

Stan Collender is a partner at Qorvis Communications and founder of the blog Capital Gains and Games. He is also the author of “The Guide to the Federal Budget.”

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