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Trump's address to congress portends looming budget battles

Congress likely to demand spending restraint for president's agenda

| North America

President Donald Trump's first address to Congress on Tuesday night elevated the tone of his controversial presidency. But it also put both parties in Congress in an awkward position.

Democrats are temperamentally inclined to oppose his every move -- even though his plans to invest massively in American infrastructure reflect the kind of "nation-building at home" they like. Republicans support his call for increased defense spending in a dangerous world -- but are predisposed to worry about domestic spending that grows the national debt. These factors mean that Trump's budget and the governing vision that underlies it may not survive impact with reality on Capitol Hill, affecting not only domestic but also foreign policy.

Trump's unorthodox positions as a candidate, and his history of support for both Democratic and Republican policy platforms, should in some ways position him to be a "post-partisan" president. He ran for office as neither an ideological conservative nor a convicted liberal, but as an outsider executive who could bring his business acumen to Washington to restore economic growth and create jobs.

Democrats do not like to admit it, but he won a significant chunk of their former base: according to The Washington Post, of the 700 counties that voted for President Barack Obama twice, one-third of them switched their support to Trump in the 2016 election. Trump's challenger Hillary Clinton barely visited states like Michigan and Wisconsin, full of blue-collar Democrats, out of false confidence that she could hold these Obama voters. Many of the positions Trump articulated on Tuesday night -- on bringing back jobs that moved offshore, making it easier for companies to invest in America, making trade "fair" rather than simply "free," and enhancing paid vacation and other employment benefits -- target the historically Democratic working-class voters in the Midwest who flocked to his banner.

Partisan divides

Given that he had liberated himself from the usual political party straitjacket, including by overcoming institutional opposition from the Republican establishment to become that party's nominee, Trump initially looked like someone who could come to Washington and make some quick deals across party lines on issues like infrastructure construction, a jobs program, and economic stimulus. Instead, his early tenure has been fractious, and parts of Trump's White House appear still to be in campaign mode, leveraging wedge issues in ways that make governing more difficult.

In fact, Trump's polarizing first six weeks in office have hardened partisan views on both sides. According to The Wall Street Journal, nine in 10 Republicans support him as president, whereas nine in 10 Democrats oppose him. American presidents typically endure more of a honeymoon period than this, as partisans on the other side of the aisle wish them well in the early phase of their tenure. Not in this case.

Trump's address to Congress sought to heal some of those divides, including by appealing to Democrats on infrastructure spending, employee benefits, and trade protectionism. He also excited Republicans with his talk of investing in incontestable American military superiority after years in which the U.S. defense budget was underfunded, and pledging swift action on tax reform, deregulation, and replacing Obamacare with a plan that is more affordable and less punitive for small businesses.

The president lamented the pile of national debt he has inherited. But his promises to spend more to protect worker rights, strengthen national defense, and put $1 trillion into new infrastructure do not balance. Some 60% of the entire U.S. government budget comprises spending on Medicare, Medicaid, and Social Security -- the medical and social safety nets that support older and poorer Americans.

Trump has vowed to protect these entitlement programs. Defense accounts for between 20% and 25% of the federal budget, and he has pledged to increase spending there. This means any offsetting spending cuts would target only a fraction of the U.S. government budget. Tax cuts can boost economic growth but could also further squeeze government revenues.

Republicans like Speaker of the House Paul Ryan have argued for years that reforming entitlement spending -- to prevent essential social welfare programs from going bankrupt -- is both the fiscally and morally responsible thing to do. Otherwise, ballooning entitlement costs as American society ages, combined with interest payments on a growing national debt, will crowd out all other spending -- ultimately leaving zero for essential priorities like defense.

Showdown looms

For all the ceremonial applause of his first address to Congress, Trump has therefore set himself up for a possible showdown with leaders of both parties in the House and Senate. For American allies, the boost in defense spending is a boon -- U.S. competitors can count ships, missiles, combat aircraft, and other tools of power projection, and an increase in their supply and deployment could help stabilize key regions like Eastern Europe and East Asia, balancing against efforts by Russia and China to carve out new spheres of influence.

The stimulus to the American economy of a tax-cuts-plus-infrastructure program could boost U.S. gross domestic product in the near term, enhancing U.S. material power relative to its competitors. But the implications for deficits and debt are alarming if savings are not found to control costs in the entitlement programs that threaten America's long-term fiscal health.

And in the likely scenario that gridlock ensues when Congressional Republicans and Democrats do not embrace the president's agenda without spending restraints -- or in the Democrats' case, an increase in domestic spending to rival that for defense -- Trump's vow to bring dramatic change to Washington could be undercut by inability to move his program through Congress. Key members of both parties are likely to resist erecting systematic new barriers to trade and skilled immigration, even if such economic nationalism plays well on Main Street.

These domestic conflicts could also limit American attention to foreign affairs at a time when globalization is going into reverse and nativism, protectionism, terrorism, and great power revanchism are eroding the liberal world order America and its allies built.

Indeed, Trump noted pointedly that he was responsible only to the American people, not the world. For 70 years, every American president has defined himself as the leader of the free world. Although in his address he nodded to U.S. allies and promised to be a good partner, this president instead maintained that all nations are "free" to choose their own course. U.S. competitors including Russia, China, and Iran could interpret that approach as one that gives them new leeway to construct exclusive spheres of influence.

Trump lamented the $6 trillion the United States has spent in the greater Middle East since the 9/11 terrorist attacks in America of 2001 -- even as he promised to destroy the terrorism that emanates from that region, which will require a continuing commitment to missions in Afghanistan and Iraq, and expanded counterterrorism operations across the region. Here, as in his approach to relations with Asia and Europe, his messaging was mixed, leaving both allies and adversaries unsure of his intentions.

Trump seems to understand that regenerating American power and confidence at home is essential to its projection throughout the world. This will be a difficult task unless he can unify a country that in many ways has become more polarized since his election. He only began to make the case for how he would do it in his inaugural address to Congress.

Daniel Twining is counselor at the German Marshall Fund of the United States. He served as a member of the U.S. Secretary of State's policy planning staff during the George W. Bush administration, and as foreign policy adviser to Senator John McCain.

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