By: Glenn Thrush and Manu Raju
President Barack Obama will toe a fine fiscal line in his State of the Union address Tuesday, proposing new infrastructure and education spending to spur job growth – along with enough spending cuts and tax reform measures to blunt criticism that he’s ignoring the deficit.
Congressional Republicans aren’t waiting to see the details, arguing that any “investments” at a time of record-breaking deficits are simply code language for a second economic stimulus package, which they have cast as a fiscal disaster that worsened the $14 trillion national debt.
The GOP effort to define Obama’s speech before he gives it started on the Sunday talk shows and accelerated Monday as word leaked of Obama’s plan to propose significant new investments in clean energy; bridges, roads and railways; and education, perhaps in the form of a re-branded school construction and renovation initiative.
The White House sees the speech, which comes less than a month after the attempted assassination of Rep. Gabrielle Giffords (D-Ariz.), as a chance to unify the country and expand bipartisanship. But the need to attack a stubborn 9.4 percent unemployment rate has unmasked a fundamental partisan clash over job creation and deficit reduction that will linger long after Obama’s words fade.
The president will embrace both spending and cutting, a double-vision approach previewed in a White House email to surrogates on Monday that described the need to invest “only in what makes America stronger and cutting what doesn’t.”
Don’t hold your breath for specifics – Obama aides say this will be a speech not a spreadsheet, intended to set priorities, not lay out the ultimate levels of funding, cutting or taxation.
That stance tracks closely with public opinion. For all the Republican claims that their 2010 midterm victories amounted to a mandate to slash spending, recent polling suggest many Americans support deficit reduction in principle – but want their favorite programs kept intact.
The West Wing on Monday was keeping a tight lid on any details of Obama’s speech, but administration sources say the president is expected to offset his spending proposals with a series of deficit reduction measures, including some already-hinted-at discretionary spending cuts, coupled with a possible simplification of the tax code to eliminate some loopholes.
One White House ally who has been in close touch with Obama’s staff in recent days, predicted that the president would not call for specific action on entitlement spending – and won’t immediately produce a specific plan for containing Social Security costs, as many liberals had feared.
“This feels much more palatable than a few weeks ago,” the Democrat said.
Obama plans to wrap a disparate agenda with a single rhetorical bow – “competitiveness” – but any kind of spending faces a firestorm of opposition on the Hill, especially from the new Republican majority in the House.
White House talking points distributed to Democrat surrogates early Monday begin: “The most important contest we face today is not between Democrats and Republicans. It’s America’s contest with competitors across the globe for the jobs and industries of our time.”
The bullet points make no explicit reference to spending – by design – but they clearly hit a three pronged-approach on education, technological innovation and improvements that improve U.S. competitiveness, an implicit reference to the trade imbalance with China.
“[T]here’s still more work to be done for the millions of people that are either out of work or struggling to offset their shrinking paychecks with rising costs. And there’s more work to do to ensure that America and its workers can compete and win in the 21st century,” according to an email of the talking points, forwarded to POLITICO by a Hill staffer.
“The President will lay out a plan to win the future by out-innovating, out-educating and out-building the rest of the world… giving equal weight to the need to take responsibility for deficits” by investing “only in what makes America stronger and cutting what doesn’t, and reforming our government so that it’s leaner and smarter for the 21st century.”
Obama and his staff planned to reduce some details on Tuesday before the speech, but key metrics – how many jobs will be created and the total price tag – were still being worked out internally on Monday.
One senior administration official told POLITICO that Obama won’t let the GOP win the public relations war as they did with the 2009 stimulus package – and that the White House plans to dispatch nearly every cabinet member to sell the spending proposals as a run-up to the release of the actual budget next month.
One possible clue of his spending priorities: Energy Secretary Stephen Chu will host an online town hall on Wednesday, to discuss Obama’s “clean energy and innovation agenda” as a follow-up to the State of the Union.
Another clue – more a guide than a specific roadmap: Obama’s Labor Day 2010 speech in Milwaukee, in which he laid out an ambitious, and yet unfunded $50 billion plan to rebuild 150,000 miles of road, 4,000 miles of railroad and 150 miles of new runway.
“The president likes to make grand speeches but the follow-through is not usually in keeping with the message,” said one senior GOP aide. “Is he going to say we need to do something about spending and debt and then actually join us or just talk about it? The word ‘investment’ will also sound a lot like ‘stimulus’ to most American and we all saw how that policy failed to create jobs and turned the public sour on the administration.”
That echoed remarks Senate Minority Leader Mitch McConnell on Sunday. “The American public as one pundit put it, has issued a massive restraining order,” the Kentucky Republican said on “Fox News Sunday.”
“This is not a time to be looking at pumping up government spending in very many areas,” he added.
At his briefing Monday, White House Press Secretary Robert Gibbs refused to respond to McConnell’s remarks, but stressed instead that Obama will talk Tuesday night about a whole host of economic issues, “including getting our fiscal house in order” and “talking about what we have to do to make progress on our spending.”
“We’re not going to have a debate in Washington about whether we need to make some changes and whether we need to control our spending,” Gibbs said. “We’re going to have hopefully a bipartisan discussion and work together on how we go about doing that.”
He said deficit reduction will be a major topic of discussion in 2011, but would not address when Obama will respond to recommendations from his deficit reduction commission.
In the Republican response to Obama’s speech, Rep. Paul Ryan of Wisconsin will speak from the Budget Committee offices in an attempt to symbolize the GOP’s pledge to cut spending, according to GOP sources.
Ryan will discuss reining in Congress’ “spending binge” and will criticize Democrats for not passing a budget last year and tout GOP efforts to cut spending, aides said. Moreover, Ryan will discuss “cutting up the credit cards” and say the GOP is moving to cut spending.
“We’re going on offense on spending,” said one senior GOP aide, speaking to POLITICO. “If you look at the things the administration wants to increase spending on: it’s energy, infrastructure and education – that’s the stimulus package. … As you know, ‘investment’ is Latin for more Washington spending.”
Carol E. Lee and Darren Goode contributed to this report.