The Fiscal Responsibility Summit

President Obama convened a "Fiscal Responsibility Summit" at the White House yesterday, and while I apologize for linking to a Dana Milbank article, it captures the essence of the day. Hastily convened, sparsely attended, and generally speaking, it was largely a farce. Not that the subject is unimportant, mind you. Just the way they went about hashing it out.

So here's how it went. They got a bunch of lawmakers and lobbyists/advocates together at the White House and the President gave them a pep talk. Then they went off into their "break-out sessions" to chat about issues. Then they came back again at the end of the day to get back together with the President to sum the day up.

I joined in the theater late, when they had reconvened with the President. I had the sound on the TV turned down, as I was on the phone, but what I saw for a moment really got my attention. What I SAW made me think for a second that President Obama had actually created a venue in which he and his administration's policies were going to be questioned, and he would have to answer for them. What I SAW made me think of "Prime Minister's Questions", the weekly time in Parliament when the British Prime Minister is actually questioned--quite harshly--by his political opponents. I've always thought that this would be a great exercise for American Presidents to undergo (although I fear GWB would NOT have done well). Because the sound was down, I began to think, "maybe this Obama guy IS different and special. Maybe he is actually going to submit himself to tough questions from his political opponents. Maybe there is something to this..." My call then ended and I turned up the sound. I could not have been more incorrect in my fantasizing.

John McCain's discussion of the cost overruns on the Presidential helicopter was about as close to this Nirvana as it came--though McCain looked like the accused in a Stalinst show-trial, knowing all along that he was participating in the theater of the absurd.

Then, other participants were called upon to "testify" to the goodness and wonder of what they had accomplished there. All were "grateful" to the President for convening the summit. There was goodness, and there was light. And nothing was accomplished.

Tackling the deficit will be incredibly difficult for the Obama Administration. Bill Clinton did an admirable job with it, but then again he had a growing economy to fuel revenue and a Republican Congress to help tamp down spending (something Republicans forgot how to do when one of their own was in the White House). I think Obama's inclinations are to aggressively tackle the deficit, but he'll be hamstrung by his own party in that regard, as he'll soon find out that the taxes he's sure to raise (and he surely will) will not be enough to close the gap. He'll have to cut spending, and that's where his own party will be a liability.

The best way to cut the deficit is to grow the economy. The stimulus package was envisioned to jump start us, but I believe it will do little (as passed) to move along the recovery. Shoring up the financial system and putting common sense controls in will have a much better chance of getting things moving again than much of what passed for stimulus in that bill.

Where the President needs to be particularly careful is in when he raises taxes. I'm taking it as an article of faith that he will. I only hope he's smart enough to wait until the economy has had at least a year (if not two) of consecutive quarters of growing GDP, rather than simply allowing the Bush tax cuts to expire in 2010 (as they will if he and the Congress do nothing). Many economists believe we'll be in recovery or well on our way to it by then. Raising taxes while the country is in recession is a foolish act--raising them while the economy is just starting to recover is foolish and incredibly irresponsible.