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Dems to Obama, Clinton: Cut some spending

/ Source: National Journal

Sens. Hillary Rodham Clinton and Barack Obama are crisscrossing Pennsylvania, touting their spending and tax cutting proposals to woo the blue-collar voters who could be the key to the state's April 22 Democratic primary. But a new analysis by the Democratic Leadership Council has some advice for the Democratic standard-bearer if he or she wants to win over independents in the general election: Stand for fiscal restraint.

Paul Weinstein Jr., a senior fellow at the DLC's Progressive Policy Institute who teaches public policy at Johns Hopkins University, and Marc Dunkelman, the DLC's vice president for strategic communications, argue that either Clinton or Obama will have to propose at least some spending cuts if they want to take advantage of President Bush's record of deficit spending.

"They have to offer some really specific proposals on spending to pass the smell test," Weinstein said in an interview. "That would give them some credibility, and voters would not be so easily scared that they're just interested in raising taxes."

If Democrats don't establish their bona fides on reining in spending and "demanding that the federal government live within its means," Weinstein and Dunkelman suggested, then they'll continue to be vulnerable to GOP charges that they're tax-and-spenders.

But as Obama and Clinton drum up support among Democrats in Pennsylvania -- where only registered members of the party and not independents can participate in the closed primary -- neither one has been shy about ringing up new spending or expressing confidence in big-government solutions to economic problems.

On Wednesday, Clinton announced a new "in-sourcing" agenda to create high-wage jobs in the United States by giving companies $7 billion a year in new tax breaks. On Tuesday, she announced an infrastructure agenda to spur employment that featured a $10 billion emergency fund to repair bridges, tunnels, roads and water systems.

Obama said in a Wednesday speech to a gathering in Philadelphia of Pennsylvania AFL-CIO members that "it's time Washington started showing the same kind of leadership that Pennsylvania's labor movement has shown by fighting to create the green jobs that are the jobs of the future." He vowed that if he's elected president, he'll "invest" $150 billion over 10 years to create 5 million new jobs.

The Clinton campaign is promoting her image as a strong steward of the economy with a new TV ad in Pennsylvania; her chief strategist, Mark Penn, maintained that her position would not be undermined by her eagerness to hand out new tax breaks and boost spending because Clinton had budgetary offsets for her programs.

"She's very careful to have pay-fors for the proposals she makes," he said.

The DLC study offered a number of specific spending steps the Democrats could take to demonstrate their commitment to fiscal restraint: reducing the number of government contractors by 750,000, curtailing government travel, banning bonuses for political appointees, stopping acquisition of new federal office space, cutting the number of no-bid government contracts and establishing a corporate welfare commission that would reduce tax breaks and subsidies to companies. The study calculated that the total savings over a 10-year period from these steps would be more than $606 billion.

Weinstein, who is also a former chief of staff of Bill Clinton's White House domestic policy, said that both Clinton and Obama have called for strengthening the PAYGO budget rules. Those rules require new tax cuts or spending increases to be offset by either tax increases or reductions in other government outlays; Bush and congressional Republicans allowed them to lapse. But Weinstein, noting that 2004 Democratic presidential nominee John Kerry was also a PAYGO advocate, said that calls for reforming the budget process alone are not enough to convince swing voters that Democrats would trump Republicans on fiscal policy.

Weinstein pointed out that both Clinton and Obama have advocated some ways to reduce federal spending: Clinton has called for cutting government contractors by 500,000 and Obama wants to chop the number of budget earmarks to 2001 levels.

"They're already doing better than Kerry, but they still have a way to go," Weinstein said.

In putting together the analysis, Weinstein said that the DLC "worked and consulted" with several Democratic congressional staffers, including aides from the offices of Sen. Thomas Carper of Delaware and Rep. John Tanner of Tennessee -- both of whom are currently neutral in the Clinton-Obama contest -- as well as members who are part of the New Democrat and Blue Dog coalitions.