Pelosi Will Take Wait-and-See Approach to Debt Commission’s Proposals

BY Terence Burlij  November 12, 2010 at 8:49 AM EDT

Speaker of the House Nancy Pelosi. File photo; Getty Images.

The Morning Line

What a difference a day makes.

On Wednesday, outgoing House Speaker Nancy Pelosi called the draft proposal released by the co-chairs of the president’s National Commission on Fiscal Responsibility and Reform “unacceptable.”

But on Thursday, when asked by Time’s Massimo Calabresi if she would ultimately accept the commission’s results, Pelosi responded, “I will have to see what is in the final draft.”

The California Democrat also said: “Any viable proposal from the president’s fiscal commission must achieve the goals of reducing the deficit, promoting economic growth and preserving Social Security. This proposal does not meet those standards.”

The draft proposals would make cuts to Social Security, Medicare and Medicaid, raise the retirement age to 69 by 2075, do away with popular tax breaks, such as the mortgage interest deduction and the earned income tax credit, and phase in a 15-cent increase in the gas tax.

The plan aims to reduce the national debt by nearly $4 trillion over the next 10 years.

Senate Majority Leader Harry Reid also weighed in on the proposal Thursday. “While I don’t agree with every one of their recommendations, what they have provided is a starting point for this important discussion. I look forward to the full commission’s recommendations and to working with my colleagues on both sides of the aisle to address this important issue,” said Reid.

Clearly, the president’s comments in Seoul Thursday urging lawmakers to “gather up all the facts” before “shooting down proposals” struck a chord. President Obama will have a good deal more convincing to do when the commission releases its final report, expected by Dec. 1.

COMPROMISING POSITION

Real compromise between the resurgent Republican Party in Congress and President Obama’s Democratic Party on how to deal with the Bush tax cuts, which expire in January, could be more difficult as liberals express outrage that the president might be willing to make a deal with the GOP on the issue.

Both the New York Times and Washington Post have stories Friday highlighting a liberal backlash after White House Senior Advisor David Axelrod hinted to the Huffington Post that the administration may agree to extend all of the Bush-era tax cuts, rather than extending cuts for families making $250,000 or less and letting the cuts expire for the wealthiest Americans.

The Huffington Post ran this headline on Axelrod’s remarks: “WHITE HOUSE GIVES IN ON BUSH TAX CUTS”

President Obama addressed the issue in a press conference Friday in Seoul when asked by NBC’s Savannah Guthrie if Axelrod’s comments suggested he was open to temporarily extending all of the Bush tax cuts.

“I want to make sure that taxes don’t go up for middle-class families starting on January 1st. That’s my number-one priority — for those families and for our economy. I also believe that it would be fiscally irresponsible for us to permanently extend the high-income tax cuts.  I think that would be a mistake, particularly when we’ve got our Republican friends saying that their number-one priority is making sure that we deal with our debt and our deficit,” he said.

From the Times:

Privately, White House officials fumed that the original headlines about Mr. Axelrod’s comments were overblown and did not reflect the senior adviser’s meaning. “I didn’t say anything we haven’t said before,” he wrote in an email.

The fact that his denials seemed not to matter much in the liberal community was a testament to the current, frenetic, headline-grabbing media environment. But it is also a reflection of the broader angst in the liberal community about Mr. Obama and his administration.

One prominent liberal in the House expressed his frustration with the White House to the Post.

“Democrats are not going to be a rubber stamp for deals [Obama] cuts with the Republicans in the House or the Senate,” said Rep. Raul M. Grijalva, D-Ariz., a co-chairman of the Congressional Progressive Caucus. “Part of the battering we got [on Election Day] was about not being able to show our base we had done enough.”

THE FACTOR: O’REILLY VS. BUSH

Former President George W. Bush stood firm Thursday night in his decision not to criticize the sitting president. He continued his string of interviews to promote his new memoir, “Decision Points,” when he sat down with Fox News’ Bill O’Reilly at the National Museum of the United States Air Force just outside Dayton, Ohio.

The discussion grew a bit heated when O’Reilly encouraged the former president to weigh in on President Obama’s handling of the economy. He compared their strategies on government bailouts, noting, “You and President Obama are simpatico.”

Mr. Bush responded, “I have chosen not to second guess the President, which you’re trying to get me to do.”

O’Reilly replied: “You’re wrong. I’m not trying to get you to bash Obama.”

President Bush went on to defend his decision to pass the Troubled Asset Relief Program. “The TARP that we passed said that we’re going to put money into financial institutions,” he said, “Which will be repaid to the taxpayer with a reasonable rate of return, and most of the TARP money that we spent under my watch has been repaid.”

When O’Reilly asked why the federal government is still bailing people out, Mr. Bush bristled: “You need to ask him, not me. I’m the retired guy.”

“You must have an opinion,” pressed O’Reilly.

Bush responded, “You’re trying to drag me into the current affairs, and I don’t want to be drug into them.”

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