Monday's Budget Summit Will Be Historic

Every other budget summit has been held when a deal had to be reached more or less immediately.  In all of those cases, a summit was needed because there was some type of budget stalemate between Democrats and Republicans, the House and Senate, or Congress and the White House (or all of those) and there was a great deal of pressure on everyone in the room to come to some agreement.  The stalemate, and therefore, the summit, usually occurred late in the budget process.

But none of these things are the case now and that means that the Obama budget summit being held at the White House on Monday is going to be very different than the ones we’ve had before.  The differences:

•    There is no need to reach a budget deal this year.  Deficit reduction is not the appropriate fiscal policy in the current economic environment and few are seriously suggesting that the summit needs to produce an agreement.  In other words, we don’t actually need the summit to do anything.

•    This summit is happening at the start of the budget process rather than towards the end.

•    There’s no stalemate that has to be resolved.

“Deficit reduction” is only on the table at this meeting to the extent that the president wants to get the discussion started.  Beginning to build a consensus now about why and how to reduce the deficit means that the debate will be further along than usual when deficit reduction is again in vogue.

No one should, therefore, expect any type of major agreement to be announced when the summit ends late on Monday.  Some discussion on general guidelines might be the only thing that will result, and even that is a long shot.

A lack of an agreement doesn’t mean, however that the Obama budget summit will have failed.  Just the opposite: getting the deficit reduction discussion started a year or so before a decision is needed by itself will be a major achievement whose importance should not be minimized.