This morning, Sen. Evan Bayh (D-IN) appeared on MSNBC’s Morning Joe to (unsurprisingly) endorse President Obama’s new proposal to institute a discretionary spending freeze for two years. “The freeze would affect $447 billion in spending, or 17% of the total federal budget,” but it would “exempt security-related budgets for the Pentagon, foreign aid, the Veterans Administration and homeland security, as well as the entitlement programs that make up the biggest and fastest-growing part of the federal budget: Medicare, Medicaid and Social Security.”

Bayh supported Obama’s new approach but criticized him for spending too much time on health care reform. “We can have progressive government in this country, but you’ve got to take it a step at a time. You’ve got to be in touch with the times you’re in,” he said:

And going with the large bill in the middle of the worst recession since the 1930s and a major new expenditure at a time we were running a $30 trillion deficit just didn’t resonate real well. Monday morning quarterbacking is not something I’m into, but you’ve gt to learn from these sorts of things, and going forward let’s do what we can in a common sense way.

Watch it:

Bayh is wrong to suggest that health care reform is antithetical to reducing the nation’s $1.4 trillion deficit. After all, according to the Congressional Budget Office (CBO) the Senate health care bill would reduce the deficit by $132 billion over 10 years (or up to $409 billion over 10 years according to a Commonwealth study) and lower Medicare spending per beneficiary from 8% growth rate to 6% growth rate. As Christina Romer, chairwoman of the Council of Economic Advisers, explained in December, reform would slow the growth rate of cost by 1 percentage point per year” and have “a dramatic impact on where we are relative to otherwise we would have been.”

Health care reform would compliment the administration’s new focus on deficit reduction by slowing the fastest growing part of the deficit. In yesterday’s interview with Diane Sawyer, Obama reiterated his commitment to “keep on pushing” “on the big issues” and said, “We are going to have to be serious about the deficit in ways that we haven’t been before.” Obama didn’t say if he would urge Congress to pass comprehensive health care reform as party of his effort “to be serious about the deficit,” but taking a strong position on reform certainly demonstrate that he is “not backing off the need for us to tackle these big problems in a serious way.” As he told Congress during his address in February, “Put simply, our health care problem is our deficit problem. Nothing else even comes close. Nothing else.”

Cross-posted on The Wonk Room.

The Obama administration has announced that in tomorrow’s State of the Union address, President Obama will call for a freeze on non-defense discretionary spending. The freeze — which will keep fiscal year 2012 and 2013 spending at the 2011 level — is designed to save $250 billion over ten years, and will “exempt security-related budgets for the Pentagon, foreign aid, the Veterans Administration and homeland security, as well as the entitlement programs that make up the biggest and fastest-growing part of the federal budget: Medicare, Medicaid and Social Security.”

So it seems that Sen. Evan Bayh’s (D-IN) estimate that “there’s a fighting chance” of Obama proposing a freeze has been proven correct. Of course, during the Presidential campaign, Sen. John McCain (R-AZ) proposed a similar spending freeze, which Obama repeatedly condemned as an “example of unfair burden sharing,” and “using a hatchet where you need a scalpel.” Here’s a compilation placed on YouTube yesterday of Obama scoffing at a spending freeze in all three presidential debates:

The administration’s contention is that, unlike McCain’s proposed freeze, this operates more like a spending cap, with some programs’ funding going up and others down. As Matthew Yglesias put it, Obama is “aiming for what you might call a ‘cut and invest’ strategy — slashing certain programs and boosting others. And I think anyone who looks at it would have to admit that there is, in fact, a lot of discretionary spending on programs of little value.”

But still, many economists have blasted the plan for its potentially anti-stimulative effects and its focus on spending that is not the root cause of the country’s long-term deficits. Nobel Prize winning economist Paul Krugman wrote that the freeze is “appalling on every level…shifting attention away from the essential need to reform health care and focusing on small change instead.” Former Labor Secretary Robert Reich said that the freeze “will make it impossible for [Obama] to do much of anything for the middle class that’s important.” U.C. Berkeley economist Brad DeLong added “this is a perfect example of fundamental unseriousness: rather than make proposals that will actually tackle the long-term deficit…come up with a proposal that does short-term harm to the economy without tackling the deficit in any serious and significant way.”

And at its core, Obama’s decision cedes to the right-wing both the idea that blanket cuts are necessary and the notion that cuts should be focused on domestic programs while defense spending goes untouched. And already, the right-wing is claiming the freeze as a victory, with the National Review’s Jim Geraghty writing, “if the arguments in the coming years are between spending freezes and spending cuts, then we’ve already won.”

Cross-posted on The Wonk Room.

In an interview yesterday with Bloomberg’s Al Hunt, Sen. Evan Bayh (D-IN) — who met with members of the administration’s economic team this week — said that he believes there’s a “fighting chance” that President Obama will call for a freeze on discretionary spending in his next budget:

We can do something right here, right now, starting next week. The President can say in his State of the Union address, ‘I’m going to include in my budget a freeze on discretionary spending, I’m drawing the line in the sand, and I’m willing to use my veto pen to enforce that’…I think there’s a fighting chance that he will. That’s what I’m looking for.

Watch it:

Bayh is the signature model of a “deficit peacock”: someone who likes to harp on deficits, while at the same time voting for budget-busting expenditures like a $250 billion tax cut for the heirs of wealthy families. So his approval of a spending freeze fits right in.

What’s more troubling is that the administration might take this seriously. This all stems from Office of Management and Budget Director Peter Orszag asking every executive department to submit three budget proposals, including one that freezes spending and one that reduces spending by five percent. The administration has also made other noise about serious deficit reduction in fiscal year 2010 being under consideration.

There’s obviously something to be said for identifying programs that don’t work or that overlap with other programs. But a straight spending freeze is a blunt instrument that has no place in responsible budgeting. When the Republicans proposed various versions of a spending freeze during the debate over Obama’s first budget (and when Sen. John McCain (R-AZ) had the same idea during the presidential campaign), they were correctly regarded as being in right-wing fantasy land.

Not only is a freeze a poor way to budget that doesn’t take into account priorities or the effectiveness of a particular program, but it will also have an anti-stimulative effect while the economy is still struggling through a middling recovery. Bayh analogizes the federal budget to a family’s checkbook, but the truth is that there is a lack of demand in the economy — an output gap between what the country could produce and what is is actually producing — that only the government can fill. “We cannot invite a W-shaped recession, or an M-shaped recession,” said Rep. John Olver (D-MA), when asked about a spending freeze.

“Do you think we could have a 5 percent reduction in [Low-Income Home Energy Assistance]?” asked Rep. Robert Andrews (D-NJ). “Do you think we could have a 5 percent reduction in food stamps?” The real long-term issues in the budget have little to do with discretionary spending and everything to do with health care costs, entitlements, and plummeting tax revenue in the wake of an economic crisis. A blunt spending freeze sounds nice, but only real reform in those other areas tackles the actual problems with the federal budget.

Cross-posted at The Wonk Room.

In December, Weekly Standard editor Bill Kristol called for Rep. Mike Pence (R-IN), the ultra conservative Chairman of the House Republican Conference, to “mount a serious challenge to Indiana Senator Evan Bayh, who’s up in 2010.” “If he won, he’d be a leading possibility for national office as soon as 2012,” wrote Kristol.

On Fox News last Friday, Kristol indicated that Pence was moving towards a Senate run, saying that “the results of Massachusetts are going to generate all kinds of people jumping into the race you haven’t been expected to.” Watch it:

Now, with Scott Brown’s victory in Massachusetts last night, Politico reports that “Pence is now considering a campaign of his own against Sen. Evan Bayh.” MSNBC’s First Read adds that they’re “hearing whispers in Indiana that national Republicans think they can convince House GOP leader Mike Pence to channel his presidential ambition via an Evan Bayh challenge.” Hotline’s Reid Wilson reports that “Pence and his aides will meet with top staffers at the NRSC tomorrow” to discuss a possible challenge to Bayh.

For his part, Bayh is using the Massachusetts special election to tack to the right and lash out at the “left.” In an interview with ABC News yesterday, Bayh called Brown’s win “a wake-up call” that moderates and independents “don’t believe the answers we are currently proposing are solving their problems.” “Whenever you have just the furthest left elements of the Dem party attempting to impose their will on the rest of the country — that’s not going to work too well,” said Bayh. And this past weekend, Bayh criticized “congressional elites” who “mistook their mandate.”

Extensive coverage has been devoted to the fact that Lindsey Graham’s split on global warming and other issues highlights a rift in the Republican Party. While that’s true, another more important development has not been pursued: Graham’s departure from right-wing orthodoxy highlights the potential for conservative Democrats to follow in his footsteps.

Many conservative Democrats have questioned President Obama’s clean energy agenda. Now, a Republican is breaking with his party to talk sense. In a press conference yesterday with Sen. John Kerry (D-MA), the author of the Clean Energy Jobs and American Power Act, and Sen. Joe Lieberman (I-CT), Graham rebuked senators unwilling to address carbon pollution. Saying that he has “seen the effects of a warming planet,” Graham called for the United States to “lead the world rather than follow the world on carbon pollution”:

The green economy is coming. We can either follow or lead. And those countries who follow will pay a price. Those nations who lead in creating the new green economy for the world will make money.

Watch it:

Graham sounded more like Van Jones — the author of “The Green Collar Economy” who was branded by Glenn Beck as a “communist” — than many of his Democratic colleagues:

Max Baucus (D-MT): Montana, with our resource-based agriculture and tourism economies, cannot afford the unmitigated impacts of climate change. But we also cannot afford the unmitigated effects of climate change legislation.

Evan Bayh (D-IN): Jobs should be our top priority and we shouldn’t do anything that detracts from that.

Robert Byrd (D-WV): I will actively oppose any bill that would harm the workers, families, industries, or our resource-based economy in West Virginia.

Byron Dorgan (D-ND): I just don’t think climate change is going to be on the floor this year. Trying to restart our economic engine and trying to get this country back to work — to me that is the most important issue.

Blanche Lincoln (D-AR): I am opposed to the House passed cap-and-trade legislation, which in my view, picks winners and losers and places a disproportionate share of the economic burden on families and businesses in Arkansas.

Claire McCaskill (D-MO): I hope we can fix cap and trade so it doesn’t unfairly punish businesses and families in coal dependent states like Missouri.

Ben Nelson (D-NE): I think at the end of the day, the people who turn the switch on at home are going to be disadvantaged.

Jim Webb (D-VA): We can’t just start with things like emission standards at a time when we’re at a crisis with the entire national energy policy.

Do these Democrats agree with Lindsey Graham that our planet “is in peril“? Do they agree with Graham that “limiting carbon pollution is good for business”? Will conservative Democrats follow Sen. Graham’s embrace of the “new green economy” — and shouldn’t they be asked if they will?