In picking Sylvia Mathews Burwell to be his budget director, President Obama on Monday again enlisted a Clinton-era veteran for his economic team as it deals with fiscal and partisan challenges that make the earlier time seem like the good old days.
Obama announced Burwell’s nomination, along with his Cabinet choices for the Energy Department and the Environmental Protection Agency, before an East Room audience. He used the occasion to decry the across-the-board cuts to military and domestic spending, known as sequestration, which took effect Friday when he and Republicans in Congress failed to agree on an alternative deficit-reduction package.
The president said Burwell, who previously ran the Gates Foundation’s Global Development Program in Seattle, would work with the acting director of the Office of Management and Budget, Jeffrey Zients, to “do everything in their power to blunt the impact of these cuts on businesses and middle-class families.”
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“But eventually a lot of people are going to feel some pain,” he said. “That’s why we’ve got to keep on working to reduce our deficit in a balanced way.”
The president defines balanced deficit reduction as combining spending cuts, including in entitlement programs like Medicare, with new revenues from curbing tax breaks for the wealthy and corporations. Yet Republicans in Congress signaled anew their opposition to any tax increases.
House Republicans introduced a measure that would extend current spending levels, which expire March 27, to the end of the fiscal year Sept. 30 to avoid a governmentwide shutdown late this month. All the spending is subject to the automatic cuts, but the measure adjusts military accounts to cushion the impact.
As Obama sought to keep attention on the dislocations and job losses ahead from the cuts, he convened his Cabinet for the first time in his second term to discuss the effect if the reductions are not reversed.
“We are going to manage it as best we can, try to minimize the impacts on American families, but it’s not the right way for us to go about deficit reduction,” the president said.
Although both parties say a compromise to replace sequestration this year is unlikely, Obama said, “I will continue to seek out partners on the other side of the aisle so that we can create the kind of balanced approach of spending cuts, revenues, entitlement reform that everybody knows is the right way to do things.”
Further partisan maneuvering is ahead as House Republicans and Democrats who control the Senate introduce separate budgets for the fiscal year that starts Oct. 1, underscoring their differences over government’s size and priorities.
Rep. Paul D. Ryan, R-Wis., chairman of the House Budget Committee, greeted Burwell’s nomination warmly.
“In her previous tenure at OMB, she helped a Democratic president commit to a balanced budget and work with a Republican Congress to get it done,” he said.
While it is the Senate that votes on her nomination, Burwell, a West Virginia native, is not expected to encounter serious resistance.
The Harvard and Oxford graduate largely came to Obama’s attention on the recommendation of one of her several Clinton administration mentors, Jacob Lew, now the secretary of the treasury. When Lew was budget director for Clinton, Burwell — then Sylvia Mathews — was his deputy. (She married in 2007 and is now the mother of two small children.)
Another mentor was Robert Rubin. When he was the first director of the National Economic Council at the start of the Clinton presidency, he chose as staff director Burwell, who had been a Rhodes scholar. She followed Rubin when he became treasury secretary, serving as his chief of staff. Later she was promoted to deputy White House chief of staff and deputy budget director.
Working with Rubin “she became an extremely skilled negotiator,” said John Podesta, a former Clinton chief of staff.
“Everyone who works with her really admires her not only for her intelligence and the depth of her knowledge on federal budget matters, but also her organizational talents,” Podesta said.
She was among the ambitious Democratic aides who orbited around Rubin, won promotions and then pursued careers outside government. Now Burwell, who left Washington after the Clinton years to work for the Bill and Melinda Gates Foundation in Seattle and then the Walmart Foundation in Arkansas, is poised to join those who returned to government with Obama.
Rubin’s fiscally moderate influence and the broader experience of the Clinton years — marked by repeated budget fights with Republicans, and ultimately a balanced-budget agreement — was formative for many of those who came to the Obama administration. They have included Gene Sperling, now director at the National Economic Council, as he was for Clinton, and Peter Orszag, Obama’s first budget director.
Former Clinton chief of staff Erskine Bowles calls Burwell “the single most competent person I’ve ever worked with.”
“Lots of people can do strategy, others execution of that strategy,” he said. “Sylvia can and will do both.”
Yet times have changed since the Clinton era. The kind of bipartisan compromises that Clinton made with Speaker Newt Gingrich have proved elusive for Obama, given the influence of anti-government, anti-tax conservatives in constraining House Speaker John Boehner’s negotiating ability.
And as Obama is eager to get on with the rest of his agenda — including immigration, gun safety and early-education initiatives — that could leave Burwell to manage the existing fiscal agenda rather than help chart a new one that would, through a deal on entitlement programs and revenues, stabilize the long-term debt.
Information from Bloomberg News is included in this report.