The Administration takes a two-year holiday from its own agenda.
President Obama’s re-election machine is already running full bore, but has his entire Administration also decamped for the campaign trail? We ask because the towering ambitions of Mr. Obama’s first two years have suddenly gone into abeyance in his third, apparently to be deferred until years five through eight. The White House is more or less conceding that it doesn’t have a chance of winning a second term unless his major policies go on hiatus.
This holiday from committing liberal history began in December with the White House-GOP deal that extended the Bush tax rates through the 2012 election and added a payroll tax cut on employees to 4.2% from 6.2%. These proposals came from the same Democrats who only months earlier had increased payroll taxes to finance their health-care bill and routinely claim that tax rates don’t matter to the private economy. But then, 9.1% joblessness and 1.8% growth have a way of concentrating the political mind.
Next came the much-ballyhooed White House scrub for “excessive” regulation, even as hundreds of new rules mandated by the legislation of the first two years continue to be written and to slow business investment. But at least the rule review persuaded the Environmental Protection Agency to stop treating dairy farm milk spills as if they were Gulf oil leaks. That should help next year in Wisconsin.
Picking up the vacation pace, this week the EPA delayed by two months the carbon regulations that it wants to impose, even as it resists bipartisan attempts on Capitol Hill to kill them altogether. Next up may be a delay in pending regulations meant to harm coal-fired power, before opponents gather enough votes to kill them. The EPA has already yanked an entire rule that would have forced thousands of businesses to install new industrial boilers.
Maybe the White House should short-circuit all this by dispatching EPA administrator Lisa Jackson to an undisclosed location through November 2012.
Also this week, the Commodity Futures Trading Commission voted—five to zero—to delay by six months the derivatives swap rules that were due this month under the Dodd-Frank financial re-regulation. The alphabet soup of financial regulators will eventually add tens of thousands of pages to the Federal Register, but for now they are conceding that the derivatives market isn’t the calamity they claimed it was in the rush to pass the bill.
Then there’s health care. Over the last year, the Health and Human Services Department has granted at least 1,372 temporary waivers to ObamaCare mandates, most notably for price controls on private insurance companies. Many have gone to Democratic allies like unions, but many more went to ordinary businesses and even states. HHS has already given a pass to Nevada, New Hampshire and Maine, and another dozen or so have applied or are expected to ask for exemptions.
This is less political favoritism than a panicked, ad hoc bid to minimize pre-election insurance disruptions that can be attributed to a law that is still widely reviled. If the law isn’t enforced, maybe voters will forget it passed. In its New Hampshire reprieve, HHS admitted that ObamaCare would “destabilize the individual market,” though it neglected to mention that this is what ObamaCare is meant to do. Just not yet.
By the way, this waiver process isn’t in the law’s statutory language. HHS has simply created it via regulation. In other words, the health bureaucracy knew the rules they were writing would be destructive and have created a political safety valve. They have even found a way to override ObamaCare’s cuts to the Medicare Advantage program that were counted as “savings” to make the health bill look less spendthrift. Medicare Advantage offers insurance choices to one in four seniors and is popular in, well, Florida, so seniors also get a two-year reprieve.
Why aren’t liberals deploring this betrayal of their programs? Perhaps because even they can’t ignore reality forever. Mr. Obama’s epic fiscal binge, waves of new industrial policy and the political allocation of credit haven’t created the boom they promised. If business can now be persuaded that the government assault is over and start to invest again so the economy improves enough for Mr. Obama to win a second term, then a two-year delay in fulfilling their dreams is well worth it.
Liberals figure that as long as Mr. Obama can be re-elected next year on another hope-and-change platform, it will be too late to hope to change anything and he can then return to his legacy project of building a tax and entitlement state on the European model. The economy may benefit from Mr. Obama’s temporary amnesty, but the real lesson of this hiatus from liberalism is that it should be shut down permanently.