OMB Director Urges Partnership With Agencies When Making Cuts

By Andrea Salazar

With budget cuts looming, the White House’s top budget official expressed his desire to work in partnership with federal agencies when going through the budget process.

Jack Lew, director of the White House’s Office of Management and Budget, spoke to federal leaders and managers on Tuesday at an event timed to coincide with the release of a new report, entitled “Making Smart Cuts: Lessons from the 1990s Budget Front.” The report was put out by the Partnership for Public Service.

“One of the things I am urging, from an OMB perspective, is that we look at agencies as partners, in the sense that we not dictate here are the ways to achieve all of the savings, to give agencies tools, and to do it in a way that is, perhaps, less directive and more as guidance,” Lew said.

Instead of commenting on the report itself, however, Lew focused on government reform and performance.

“We have an obligation, those of us who believe that government serves an important function, to be there both making the case that there’s this duty to serve the public and to provide essential services but equally the duty to show that we have the capacity to do it better, to do it more effectively, to do it more efficiently and in the case of the budgetary times we are in, to do it more cheaply,” he said.

Looking to the 1990s for advice on the U.S. budget, the Partnership for Public Service interviewed more than 30 current and former federal officials about their experiences with downsizing during that decade. The group outlined four conditions for success in the 1990s and eight strategies used during those times to deal with budget cuts.

The report is available on the Partnership for Public Service website.

Obama Proposes New Taxes On Top Earners To Slash Deficit

President Obama made an impassioned appeal to Republican lawmakers to support his latest deficit reduction plan, details of which had already been released to the press by the time he took the podium on Monday morning.

(Click here for the White House’s summary of the plan)

Speaking in the White House Rose Garden, the president said his proposal represents a balanced approach to reigning in the nation’s bloated debt level while at the same time providing a shot in the arm to a fledgling economy.

“It’s a plan,” he said, “that reduces our debt by more than four trillion dollars, and achieves these savings in a way that is fair, by asking everybody to do their part so that no one has to bear too much of the burden on their own.”

Obama added that the measure would fully offset his jobs bill, a $447 billion plan that includes a mix of tax cuts and tax credits and spending on public works projects.

Like everything these days, the biggest challenge for the president will be getting Congress to support the plan. Republicans, led by House Speaker John Boehner (R-Ohio) and House Budget Committee Chairman Paul Ryan (R-Wis.), have already drawn a line in the sand over tax increases, which happen to comprise $1.5 trillion of the total savings found within Obama’s measure.

In a statement put out on Sunday, Ryan called the plan an example of “class warfare” — referring to Obama’s idea to raise tax rates on those making more than $250,000 per year. The president’s plan also includes the so-called “Buffett rule,” a nod to billionaire investor Warren Buffett, who has come out in support of raising investment taxes on those making more than $1 million per year.

The president, in his remarks this morning, pushed back strongly against Ryan’s assertion.

“I reject the idea that asking a hedge fund manager to pay the same tax rate as a plumber or a teacher is class warfare,” he said. “I think it’s just the right thing to do.”

Republicans will also likely accuse Obama of using gimmicks, such as counting $1 trillion in new cuts from ending the wars in Iraq and Afghanistan, to inflate total savings. However, as the Associated Press noted on Monday, Ryan included those future savings in his budget proposal earlier this year.

Jack Lew Named New OMB Director

President Barack Obama named Jacob ‘Jack’ Lew, a State Department official and adviser for Secretary Hillary Clinton, to head the White House Office of Management and Budget [OMB].

“The experience and good judgment Jack has acquired throughout his impressive career … will be an extraordinary asset to this administration’s efforts to cut down the deficit and put our nation back on a fiscally responsible path,” Obama said Tuesday.

Lew, who is replacing outgoing Director Peter Orszag, is no stranger to the role.  Under the Clinton administration, Lew served as OMB Director from 1998-2001.

“If there was a Hall of Fame for budget directors, then Jack Lew surely would have earned a place,” Obama said, noting the over $1 trillion Clinton-era surplus generated under Lew’s stewardship.

Orszag issued a statement applauding the decision.

“With his experience, mastery of the budget process, and passion for public service, Jack Lew is an individual especially qualified to serve the President and the American people during these challenging economic times,” Orszag said.

Orszag will leave the administration at the end of the month.