At a press briefing announcing a two-year pay freeze for non-military federal employees, President Obama outlined his lame duck priorities ahead of his meeting with GOP leaders tomorrow, namely: renewing the START treaty and deciding what to do about the Bush-era tax rates.
Speaking about the economic issues he plans to tackle in the coming months, Obama appeared to be digging his heels in for a showdown with Republicans (and laying to groundwork for an attempt at a second stimulus?) over next year’s budget. He stated his priorities as follows: 1) Investing in education; 2) Investing in research and development; 3) Investing in renewable energy.
Oh, yeah, and 4) Reducing spending and debt. Obama said the federal government must take action to bring down deficits and get spending under control, which he explained as “cutting spending on things we don’t need to invest in the things we do,” making sure to emphasize the “long-term” nature of the problem and that it would be unwise to “put the brakes on too quickly.” He said the fiscal commission’s report, due next week, would be a useful starting point, but overall he made it pretty clear that he views deficit reduction as a mere afterthought to all the “investments” he plans to make. If that’s the case, he will likely be in for an ugly, drawn-out battle with Republicans next year.
On that note, the president said he hoped the announcement of a federal pay freeze will set the tone for tomorrow’s meeting with the GOP leadership, and emphasized the need for cooperation and the need for compromise. “We’re going to have to budge on some deeply held positions, and compromise for the good of the country,” Obama said.
Will that include taxes? That remains to be seen at this point. Earlier today, White House communications director Dan Pfeiffer told reporters on a conference call that “Republicans will have to make the case for adding $700 billion to deficit” by extending the Bush rates for the wealthiest earners, but didn’t rule out some form of across-the-board extension.