5 Things We Learned From Obama's Speech

President Obama wants to cut $4 trillion from the federal debt in twelve years, with tax increases on the wealthy taxpayers, cuts to some defense, Medicare, Medicaid and discretionary spending, with a mechanism called a "failsafe trigger" to finish the job. Here's what else we learned.

1. 2008 Redux: Let Tax Cuts for Wealthy Expire

Remember when Obama ran on a platform of raising taxes on the wealthy? That's back in the talking points in a big way.

Obama drew his only applause line when he right at the tax versus spending calculation. “They want to give people like me a two hundred thousand dollar tax cut that’s paid for by asking thirty three seniors to each pay six thousand dollars more in health costs? That’s not right, and it’s not going to happen as long as I’m president."

If that wasn't clear enough, he underscored the point about Bush-era tax cuts a few moments later: “I refuse to renew them again."

The same proposal was in his budget for this year, so it's not new, but his moxy around the question is.

2. What a Failsafe Trigger Is – Sort Of.

Suggest that anything is "failsafe" in politics, and you're asking for heartbreak. Here, this "failsafe trigger" will go off in 2014 if the debt-to-GDP ratio isn't hitting its targets. The mechanism for the trigger is still to be determined, and will be worked out in a bipartisan deal, according to a press briefing before the speech.

So, in other words, if the political process doesn’t work to achieve the cuts necessary now, a political process now will make them happen in the long-term.

It's not the first time the president has championed a "trigger" as a way to reign in costs. It also a concept he floated in his major pitch for the health care legislation in September of 2009.

3. Where His Limit is on Health Care Changes

It's a contrast made for the campaign trail: He's making the case that the Republican plan hurts seniors; his bill that we already passed will save $1 trillion. 

The plan proposed by Rep. Paul Ryan "ends Medicare as we know it." In addition to health care overhaul, Obama will give new enforcement powers to the board created by the health care legislation to bring down Medicare spending.

But while the president said changes are necessary, he dismissed any talk of abandoning its current structure as a public entitlement program. "I will preserve these health care programs as a promise we make to each other in this society."

4. Social Security – We’ll Keep Kicking That Can 

Social Security was mentioned, but the president didn't offer any new proposals beyond what he already laid out in his budget. There, the president called for shoring up Social Security with bipartisan solutions, without reducing current benefits, privatizing, or "an approach that slashes benefits for future generations."

Bipartisan recommendations. Remember how that worked out for the federal deficit?

5. Debt Does Matter

Dick Cheney may have contended that ”Reagan proved deficits don't matter,” but Obama is driving straight at the question. "Doing nothing on the deficit is just not an option," he declared.

It's not a time for more recovery-focused stimulus, as some Obama critics on the left contend. It's time to reign it in, Obama said.

“Our debt has grown so large that we could do real damage to the economy if we don’t begin a process now to get our fiscal house in order." He folllowed with a challenge to his liberal base: “if we truly believe in a progressive vision of our society, we have the obligation to prove that we can afford our commitments.” 

The tax-versus-spend binary is tired -- and a mix is necessary, Obama says,  not just because it's what can get the votes in Congress, or the votes on a deficit commission, but because it's the president's vision.

The real work on all this, of course, will begin in early May, when Obama's asked House and Senate members from both parties to start meeting with Vice President Joe Biden (at least Biden will be rested). That's right around the time, of course, of the debt ceiling vote deadline and the first scheduled debate of the 2012 presidential campaign.