Obama risks losing liberals with talk of cutting budget

By Zachary A. Goldfarb and Peter Wallsten

President Obama faces a growing rebellion on the left as he courts independent voters and Republicans with his vision for reducing the nation’s debt by cutting government spending and restraining the costs of federal health insurance programs.

Key liberal groups, which helped elect Obama in 2008, are raising concerns that he has given up political ground to Republicans, allowing the message of reducing government to trump that of creating jobs and lowering the unemployment rate.

Seizing on Friday’s deal, which would cut $38.5 billion from the fiscal 2011 budget, activists on Tuesday threatened to sit out the 2012 presidential campaign if Obama goes too far with further cuts.

“The fundamental problem in our country right now is unemployment and a jobs crisis, not a deficit crisis,” said Deepak Bhargava, executive director of the Center for Community Change, an advocacy group for the poor. “It appears the president is fighting on the wrong terrain and is conceding that the only thing we should be talking about is how to bring down the deficit.”

The clash over government spending — coming as Obama prepares to make a major speech on fiscal discipline Wednesday — is the latest example of the frayed relations between the president and a broad coalition of union and activist groups.

The dispute also underscores a key question about what will define the coming year for Obama: an attempt to defend longtime Democratic priorities over Republican objections or an effort to seek compromise and control the national debt.

The White House is responding to concerns about spending cuts by saying that the president is working to preserve important programs that help the economy grow — such as investments in education — while taking seriously the need to reduce the debt. The White House also has said that any reductions in government entitlement programs such as Medicare and Medicaid must be accompanied by tax increases on the rich and cuts in defense spending.

“We can take a balanced approach toward reducing our deficit in the long term while protecting the investments which will enable us to grow in the 21st century,” White House press secretary Jay Carney said Tuesday.

The White House on Tuesday dispatched David Plouffe, one of Obama’s senior advisers, to meet with progressive groups at their routine coordinating meeting at the Capital Hilton, according to people knowledgeable about the meeting.

In the past, Obama has expressed exasperation with left-leaning groups because they had not credited him with achieving some of their goals, such as making affordable health care more widely available, under difficult political circumstances.

Since the budget deal was reached Friday, the White House has sounded two competing themes. It has trumpeted the cuts as being among the largest annual spending reductions in history, while arguing that they wouldn’t undermine economic activity.

“[W]hile the level of cuts was high . . . it does not have a negative impact on our economy,” Carney said. “The highest principle the president took into this negotiation was that we must not do anything that harms our recovery.”

But many liberals said Tuesday that they feared Obama had taken steps that would damage the economy. Leading liberal columnists joined with activists to pounce on the White House, questioning why the president is apparently embracing the image of deficit cutter rather than job creator.

Those frustrations have followed dismay on the left over Obama’s health-care law and the tax deal he negotiated with Republicans in December — not to mention elements of the administration’s foreign and trade policies.

The liberal activist group MoveOn.org, whose vast membership mobilized for Obama’s election in 2008, issued an e-mail blast to members Tuesday decrying the president’s deal with the GOP last week and the prospect that he might embrace some of his deficit commission’s ideas on deficit reduction.

Justin Ruben, executive director of MoveOn, said many of its 5 million members “worked their guts out” to help elect Obama. But, after the recent string of dealmaking with the GOP and the president’s apparent willingness to compromise on entitlements, he said the base could well stay home in 2012.

“If the president and the Democrats don’t stand up to Republicans, I don’t see people coming out and doing the work that it would take to get them elected,” Ruben said. “If they came out to vote, these die-hards might vote for the president, but whether they open their wallets and their hearts and their address books and hit the pavement, that’s a totally different thing.”

A liberal group called the Progressive Change Campaign Committee said Tuesday that more than 60,000 liberals responded to an e-mail by committing not to donate to Obama’s reelection campaign if he cuts Medicare or Medicaid spending.

Dean Baker, co-director of the liberal Center for Economic and Policy Research, said Obama has apparently “abandoned” his earlier view that increased spending was needed to stimulate the economy. And that suggests he may look for a bargain on entitlements.

“If he feels like the path of least resistance is to cut a deal, even if that means unwinding Medicare and substantial cuts to Social Security, I think he might do that,” Baker said.

Senate Majority Whip Dick Durbin (D-Ill.)–an avowed liberal who nevertheless is part of a bipartisan group of senators working on deficit reduction–said he understood the frustration of liberal advocates, but believes strongly that Obama has no better choice.

“We’re going through the stages of grief when it comes to our national debt, certainly on the left,” Durbin said at a breakfast with reporters Wednesday morning sponsored by Bloomberg News. “. . .At the end of the day, this is going to be a painful process.”

The near-budget shutdown of last week, Durbin said, and the need to dramatically cut domestic spending, “has been a wake up call to the left: that if you don’t move in a new direction to deal with this, then there’s going to be a re-run of this season opener with regularity.”

Some liberal activists say they recognize that Obama faces difficulties.

“I don’t think the president can be an inactive observer to a debate that is clearly going to be front and center in Washington — and that’s the deficit,” said Ron Pollack, executive director of Families USA.

He said the speech on Wednesday will offer the perfect opportunity for Obama to rebut Republicans’ claims that the best way to cut the deficit is simply by drastically slashing government programs.

Center for Community Change and the Center for Economic and Policy Research are Atlantic grantees.

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