Obama Presents Debt Reduction Plan at GWU

President Obama announced his plan to reduce the United State's national debt today to a crowd of dignitaries and students in GWU's Jack Morton Auditorium .  Titled "The Country We Believe In", the 45-minute speech outlined his proposal to combine both spending cuts and tax increases in an attempt to shave $4 trillion off of the national debt over the next twelve years.

The President first opened with some levity, joking that one reason he wanted to speak at GWU was to give students "one more reason to skip class."  Obama wasted no time, however, turning to the issue at hand, the national debt.

The White House has been at pains in recent days to underscore the "balance" of the President's proposal, and Obama quickly worked to establish a theme of duality that would endure throughout his speech.  Focusing first on the history of the role of government in the United States, Obama acknowledged that Americans were a self-reliant people "with a healthy skepticism of too much government."

However, the President contrasted this individuality with what he believed to be the interconnected nature of the American people.  Specifically citing the role of Social Security and Medicare, he asserted that "we would not be the great country we are today without those commitments."



Noting that Republicans and Democrats had jointly addressed fiscal crises in entitlements in the 1990s despite partisan rancor, Obama lambasted the fiscal record of the previous decade while not citing President Bush by name.  Accusing previous administrations of cutting taxes and increasing spending, the President noted that had the fiscal policy of the 1990s been continued, fiscal issues today would not be nearly as severe.

Obama also severely criticized the existing Republican proposal to cut the federal debt, an effort led by led by Congressman Paul Ryan of Wisconsin, who was in attendance.  When speaking on the proposed extension of the Bush tax cuts, the President did not hold back: "There’s nothing serious about a plan that claims to reduce the deficit by spending a trillion dollars on tax cuts for millionaires and billionaires."  Obama vowed later in the speech to not renew the cuts for those making more than $250,000 a year.

The President instead proposed a plan that included a pair of mechanisms to stem the growth of the nations debt.  The first, an expansion of Medicare's Independent Payment Advisory Board, would allow for this independent body to make recommendations to Congress on curbing growth in health costs.  If Congress fails to enact its recommendations or reforms of similar cost savings, the proposal authorizes the Secretary of Health to take action to prevent further increases in costs.

A "Debt Failsafe" would have a similar effect, albeit with a budget-wide scope.  If by 2014 debt projections do not show a downward path, the failsafe would trigger automatic spending cuts across the federal government.

Obama also emphasized what he described as "winning the future," stressing the importance of maintaining investment in technology and education for job creation and economic growth. The President characterized his approach as one that "puts every kind of spending on the table, but one that protects the middle-class, our promise to seniors, and our investments in the future."

GW students' responses to the speech were generally positive.  Outgoing SA president Jason Lifton, who was able to speak to both President Obama and Vice President Biden backstage before the speech, was ebullient when asked for his reaction to the presentation, saying "...this is the kind of event that people come to GW for...you can take political science classes anywhere in the world, but this is my education beyond the walls of the classroom."  John Richardson, who as Lifton's successor as SA president was attending his first high-profile event as president-elect, described the event as "impressive" and "moving."

Students did hold reservations with the details of the President's proposal.  Aria Varasteh, an Elliott School junior, expressed dissatisfaction with the President's debt reduction goals, believing that the government should take more aggressive action.  He also objected to Obama's comparison of levels of investment between some developing countries, such as Brazil and China, and the United States.  Varasteh felt that the President's comparison, an attempt to underline a perceived lack of investment in the US, was weakened by the differing economic situations of each country.