Politicians and their operatives like to stress the high stakes of an election. That, after all, is how you drive turnout. But often this strategy turns campaign arguments into abstractions: The government should help, not hinder, the private sector; the safety net must protect the neediest citizens while encouraging personal responsibility; we should defend the homeland but must do so affordably. Crucial debates, for sure—but ones that don’t say much about how governing looks on the ground.
When it comes to making real policy, President Obama and Congress have a lot of work to do. After (if?) Washington averts the fiscal cliff, policymakers will have to implement the health care law; lawmakers need to decide whether a gas tax alone can fund the nation’s entire transportation infrastructure; and generals must figure out how to shut down terrorist sanctuaries in Arab Spring countries without sending troops. National Journal looks at the litany of thorny problems that face Washington over the next two years and in some cases—since we now know who will have to solve them—how they might be fixed.
By Jim Tankersley
There’s a principle in mathematics called “order of operations.” When confronted with an equation stuffed with different calculations to make, you do exponents before you multiply or divide, and you multiply or divide before you add or subtract. Mess up the order, and you risk muffing the answer. The same is true for the economic challenges facing the president in his second term, which present themselves as a series of calculations that Obama and Congress must attack in the correct order if they want to avert another recession.
The first task is to not kill the momentum that the recovery has built over the past several months. Job growth and consumer confidence are rising. Gasoline prices, which had been an impediment to growth, are falling. Economists and financial analysts are cautiously optimistic that headwinds from Europe and China are blowing less fiercely than they had feared. Forecasters predict “modestly stronger” growth next year than originally expected, in the words of the analysis firm MKM Partners. But, as the International Monetary Fund and many on Wall Street continue to warn, a sharp fiscal contraction—or, worse, a default on government debt—would jeopardize that progress.
So the most important economic challenges of Obama’s second term actually begin in the lame-duck session. He and congressional Republicans must defuse the potential recession-inducing effects of the tax increases and spending cuts scheduled for next year. Punting to spring would buy time but not undo the problem. They’ll also need to raise the debt ceiling, preferably without the brinkmanship that rattled consumers and markets in the summer of 2011.
Once that’s done—if that’s done—Obama can move on to a pair of tasks that complement one another: accelerating gross domestic product growth and shoring up the economy’s defenses against another financial crisis. It’s a needle-threading task, but a critical one. The economy simply isn’t growing fast enough to put 12 million unemployed Americans back to work anytime soon, and the longer the slow growth persists, the higher the risk that long-term unemployed workers will become permanently unemployable and drag down the economy for years or decades.
The need for faster growth, coupled with rock-bottom borrowing costs, almost certainly cries out for more fiscal stimulus, such as bridge-repair projects and other infrastructure improvements. Other means to growth might come much cheaper. Obama and federal regulators must finish implementing the Dodd-Frank financial-reform law. The White House and Congress must forge agreements on what role the government should take in the housing market, particularly in the guaranteeing of mortgages. The winning balance will be simple, comprehensive new rules that minimize red tape. Such regulations, if implemented, should help reopen the flow of credit, which continues to constrict the recovery. The president and legislators should also help resolve any “policy uncertainty” that might be causing businesses across the country to delay investment and hiring.
Obama’s last task will be to strengthen the fundamentals of the economy for medium- and long-term growth. That includes improving education, from pre-K to adult job training, to strengthen the workforce and boost American competitiveness. And it means bringing the federal budget into balance and reducing the national debt—which divided government makes more difficult but also more likely. These happen to be the economic issues that Obama and Mitt Romney talked about most in the campaign, and they offer perhaps the most-fertile ground for bipartisan compromise. The president, however, should be wary of skipping straight to austerity before shoring up growth. His second term won’t start in recession, but if he works the equation in the wrong order, he could find himself in one soon enough.
By Catherine Hollander
The talks aimed at preventing the fiscal cliff, the year-end threat of tax hikes and spending cuts, will likely provide a framework for attempts to reach a longer-term budget deal in 2013, one that could include tax reform. But with Obama still in office and Congress still divided, the prospects of finding common ground remain uncertain at best.
In the speech Obama delivered in Chicago early on Wednesday morning, the president pledged to focus in the coming months on working with lawmakers across the aisle to reduce the deficit and reform the tax code. In October, he set the goal of a “grand bargain” on the deficit, one that would probably involve some reform of entitlements such as Medicare and Social Security.
The administration has declined to call for steep spending cuts while the economy struggles; instead, it is focusing on deficit reduction through higher taxes on the wealthiest Americans, an idea that has little GOP support. Obama has also proposed to reduce the corporate tax rate to 28 percent from 35 percent, an area where he is more likely to find Republican backers.
But the president has struggled to work with the 112th Congress, even when the rapidly approaching debt limit and looming credit-ratings downgrade pressured lawmakers to act in 2011, and he’ll be facing many of the same forces in the 113th that made striking a deal last year so difficult. Among them is Americans for Tax Reform President Grover Norquist, whose pledge not to raise taxes was signed by 279 lawmakers in the 112th Congress.
What was fought bitterly over in this Congress—raising the nation’s debt limit—pales in comparison to what members of the 113th Congress have said they will attempt. But some analysts are encouraged by the potential for a slight change in tone that could lead to progress. Senate Minority Leader Mitch McConnell said in 2010 that Republicans’ top priority should be making Obama a one-term president; if you believe that has, indeed, been the GOP goal, says Philip Wallach, a fellow in governance studies at the Brookings Institution, the cause no longer exists. And Obama could be more willing to compromise than he was over the past two years, so that he can avoid having his final term bogged down in deficit and tax negotiations.
Obama can send a signal about his willingness to go big on tax reform through his appointment of the next Treasury secretary (Timothy Geithner, who holds the post, has said he won’t stay for a second term.) Naming Erskine Bowles, former chief of staff to President Clinton and cochair of the National Commission on Fiscal Responsibility and Reform, to the position could indicate a readiness to strike a bipartisan compromise on taxes, Republican congressional staffers and lobbyists say.
No matter what, time may be an obstacle to large-scale reform, experts warn. The window for a fiscal agreement might close around the beginning of the 2014 midterm campaign. Ratings agencies and international capital markets won’t look too kindly on drawn-out negotiations—with markets paying the price for congressional gridlock.
By Coral Davenport
The president hopes to use his second term to fight global warming. By signing a law to cut fossil-fuel pollution and decisively turn the nation toward clean, renewable-energy sources, Obama could make a profound difference in the economic, environmental, health, and national-security future of the United States—and the rest of the world. And it’s the kind of sweeping achievement that historians say he craves for his own legacy.
Obama’s last, best chance to do this will come as part of a nuts-and-bolts effort to reform the corporate tax code.
Here’s why: Economists and environmentalists have long agreed that the most effective way to stop climate change and drive markets toward clean energy is to put a price tag on carbon pollution. It’s a time-tested and effective policy. Raise the price of the thing you want less of—pollution from coal and oil—and market forces will drive consumers and businesses to buy low-polluting sources of energy instead. The increased market demand for those sources drives up production scale and lowers the down price.
In his first term, Obama tried and failed to push such a cap-and-trade bill through Congress. Cosponsored by liberal Democrats from California and Massachusetts, championed by green advocacy groups, and reviled by most Republicans, the measure ran aground in the Senate, and “cap-and-trade” became a politically toxic catchphrase. The administration was instead reduced to using the Environmental Protection Agency to push through a slate of antipollution regulations.
Over the next two years, the president will have one more chance to push carbon-pricing legislation through Congress—this time, however, with a distinctly different political profile. As early as next year, Congress is expected to take up a sweeping tax-reform package that would lower corporate rates and eliminate loopholes in the tax code. As part of that process, support is growing for a carbon tax, to be paired with a cut in the payroll or income tax. The strongest supporters of the idea are conservative economists—including Gregory Mankiw, Mitt Romney’s economic adviser; Douglas Holtz-Eakin, who advised Sen. John McCain’s 2008 presidential campaign; and Art Laffer, President Reagan’s chief economic adviser. Republicans want to find a way to cut taxes on work or income—and many, at least, don’t oppose the idea of moving that tax over to carbon pollution.
The idea taking shape is to tuck a “carbon-tax swap” into a broader reform package, framed as conservative fiscal policy and championed by Republicans. That could provide the political cover it would need to get through Congress, although it will still require an uphill push. One big challenge will be to get enough Republicans, and many coal-state Democrats, to sign on to something that will inevitably be labeled an “energy tax” by groups like Americans for Prosperity, the super PAC linked to the oil conglomerate Koch Industries.
Still, a growing number of political pieces are sliding into place to include a carbon-tax swap as part of broad reform. If that happens, it could be the biggest, most transformative energy and environmental legislation in a generation—a policy that could fundamentally change the nation’s energy economy for the next century.
By Jim O’Sullivan
This time, Democrats wielded social issues as a wedge against Republicans, rather than vice versa. And from gay marriage (which Obama endorsed at the beginning of the general-election campaign) to abortion (which elicited inflammatory remarks on rape from losing GOP Senate candidates in Indiana and Missouri), Democrats were only too happy to use these issues to divide and conquer.
In Obama’s second term, the fight over health insurance coverage for contraception will ignite anew. Despite months of controversy, the administration still hasn’t solidified rules determining how employees of religious institutions will get birth-control coverage. Before the implementation date next August, Catholic bishops and the Obama administration will likely go another round in the ring.
Even before that, the Supreme Court may rule on the Defense of Marriage Act. Jurists in lower courts have penned narrow decisions that Lanae Erickson Hatalsky, director of social policy at the Democratic think tank Third Way, calls “essentially love letters to Justice [Anthony] Kennedy,” frequently the high court’s swing vote. Arguments for federalism could prove pivotal: Kennedy may be more likely to strike down the federal law if he believes he can do so without telling every jurisdiction what rights they must accord to gays and lesbians.
Even if the Court nullifies the 1996 law, policymakers would have to unravel an administrative Gordian knot. The act touches Social Security, military benefits, programs administered jointly with the states, and immigration rules. “I think the Obama administration is going to spend an intense amount of time on DOMA,” Erickson says.
By Margot Sanger-Katz
The Affordable Care act is still unpopular, its path to implementation still bumpy. But this much is now certain: It will remain the law of the land.
Without a Republican president to slow the law’s implementation or a GOP Senate to dismantle it, there will be nothing to stop Obama’s signature health reform act before 2014, when its major provisions kick in. Even if Republicans win decisive control of Washington in four years with a clear mandate for health reform, they will be working with a new status quo. “We have one overarching reality: that the Affordable Care Act is the law,” says Paul Keckley, the executive director of the Deloitte Center for Health Solutions, a major industry consultancy.
In the health care sector, that’s actually not monumental news; businesses have long assumed that the Affordable Care Act will move forward. Providers and insurers have been steadily adjusting to the shifting landscape, where financial incentives will be different and profit margins will likely be tighter. Several years of slower-than-usual growth in health care spending may indicate that changes encouraged by the law are already having an effect—although it’s early to know whether the trends will last.
Regulators, too, have been gearing up for the law’s eventual implementation. Although the executive branch has delayed issuing major health care regulations this year, numerous sources say that many of the outstanding rules are written and ready to go now that the election is over. In the states—even many deep-red states—bureaucrats have been quietly laying the groundwork for the new information systems and insurance exchanges they will be expected to run.
Obama’s reelection does end a high level of political uncertainty. Romney ran on a platform of total repeal, even if he softened in supporting some provisions in the final weeks of the campaign. House Republicans have voted twice to repeal the law; they will now need a new health care platform if they want a role in shaping policy. And it’s a decision point for state politicians: Many have held back on building the insurance exchanges or deciding whether to expand their Medicaid programs. First they waited until the Supreme Court ruled. Then they waited for the elections.
Now, governors and state legislators will need to decide—and quickly—whether they’ll cooperate or continue fighting on ideological grounds. “It’s going to sink in that it’s the law of the land; the ACA is not going anywhere, and I think you’re going to see most states saying that they would rather control their own market,” says Heather Howard, the director of the State Health Reform Assistance Network at Princeton University, which is helping 10 states with implementation. “I think you’ll see more states moving.”
None of which means that the Affordable Care Act is immutable. The president has promised a $4 trillion deficit-reduction package—a goal that is basically impossible to reach without cuts to the major health entitlement programs. The next year could see bipartisan proposals to cut Medicare, Medicaid, and subsidies for middle-income Americans on insurance exchanges. Still, even those changes would live within the basic framework of “Obamacare.” It is the new normal.
By Adam Mazmanian
Obama’s regulators arrived in January 2009 with a laundry list of priorities they have largely achieved—a version of network neutrality called the “Open Internet” rule; more spectrum for wireless broadband networks; subsidies for those who don’t yet have broadband access; and limits on how much telecom companies can charge for access to high-speed lines.
The second term will fill in the few blanks left by the first term, probably with new leadership at the Federal Communications Commission. At the same time, industry leaders and regulators want to ease the transition from the current hybrid analog-digital telecom system to a digital Internet Protocol-based system run on fiber-optic lines. “What FCC will do next is try to figure out how to have a rational IP transition, just as we had a digital television transition,” says Blair Levin, a former FCC official whose name has been mentioned as a possible chairman.
This transition could update the 1996 Telecom Act, which would give legislators a chance to contest the FCC’s Open Internet plan. Already, courts are poised to rule that the administration cannot impose network neutrality by fiat. So Democrats in Congress (urged on by the alliance of consumer watchdog groups and Internet companies that fended off the copyright legislation known as SOPA and PIPA) will try to enshrine neutrality into law. Standing alone, the effort would probably fail in the House. But GOP members might agree to net neutrality for the sake of broader deregulation. They don’t want broadband regulated under existing telecom laws; if they’re exempted, the big providers will have a freer hand in building and managing fiber networks.
Meanwhile, the 2011 American Invents Act, a patent law, needs a raft of technical corrections that could reignite issues that the measure was meant to settle. One correction would tighten rules for challenging patent grants, and would make life more difficult for companies that amass patent portfolios for the sake of suing infringers. These nonpracticing entities, sometimes called “patent trolls,” will look to avoid corrections that frustrate their business practices. Regulators frustrated by this trend have begun to see antitrust problems in the intellectual-property arena. The Federal Trade Commission, for instance, is planning to sue Google (probably this year) for restricting access to key smartphone patents. Another antitrust suit (moving more slowly through the system) could charge Google with hurting competitors by favoring its own search results.
Democrats and Republicans in Congress have also failed to agree on cybersecurity. Should they enforce minimum security standards on critical digital networks owned by private firms—or permit companies to create their own cybersecurity guidelines? Senate Majority Leader Harry Reid has pledged to bring up the issue in the lame-duck session, but if nothing happens, the administration will likely issue an executive order late this year or early next.
By Fawn Johnson
Hispanics want to make sure that, this time around, Obama sticks to his promise to tackle immigration. In his second term, the president must go after a broad immigration overhaul with the same zeal he showed on health care reform—or risk alienating a broad swath of the nation’s fastest-growing demographic.
He’s ready. He told the Des Moines Register before the election that immigration reform was his top priority once budget and tax issues are resolved. He won 71 percent of the Latino vote. Obama voters overwhelmingly said they want a path to legalization for undocumented immigrants—79 percent, according to exit polls. Half of Republican voters also said they wanted legalization. It’s as close to a “mandate” as Obama is going to get.
The biggest policy question will be how to legalize 11 million undocumented people in a way that won’t be seen as unfair to those who are waiting to become citizens legally. The biggest political question is how Republicans will handle the issue. GOP voters slammed Republican lawmakers for negotiating a legalization plan five years ago. Some lost their seats. In the wake of Romney’s loss, GOP operatives are emphasizing the party’s need to broaden its appeal to minorities, particularly Hispanics. But the calculus for congressional Republicans is somewhat different. Incumbents have to worry about whether a move to the center could leave them vulnerable to a primary challenge from the right. They will be looking only as far as 2014, not 2016.
Obama can’t rely on partisan maneuvers in Congress the way he did to pass health care reform, because some conservative Democrats are squeamish on immigration. He will need to offer compromises to Republicans, which could come in the form of new guest-worker programs or an end to open sponsorship rights for U.S. citizens to invite foreign family members into the country.
Still, Obama will need to make a better show of trying than he did in his first term. Back in 2008, he said that immigration was a top priority. Hispanics turned out in droves to help him win, and then nothing happened. Earlier this year, he created a temporary deferral program for illegal youth to shield them from deportation, but that is hardly the kind of sweeping change that Latinos and other Democrats are seeking.
“We are in a different position to demand and ask—and expect—a different delivery from President Obama,” says Lorella Praeli, an undocumented activist for United We Dream, a youth-led immigration-reform advocacy group. “The message is clear: freedom for 11 million.”
By Fawn Johnson
The president spent the past year setting up the education agenda for his second term. Now all he has to do is put the strategy in motion. It has three parts—access to college; waivers for state public-school systems; and early-childhood development.
Education Secretary Arne Duncan will stay in his Cabinet post to guide the existing department programs to the finish line. That means the incentives the administration now dangles in front of states to create teacher evaluations, to rework their student assessments, or to turn around failing schools will continue. “I’m a big believer in carrots rather than sticks,” Duncan told a group of educators in September.
Among Cabinet members, Duncan has an outsized influence on domestic policy. White House officials view the Education Department’s Race to the Top competitive grant program as one of the most successful ways the administration can encourage states to change policies without having to pony up lots of federal dollars. Of course, the $100 billion for education from the economic-stimulus package will not be available this time around. The administration has focused the last of the Race to the Top money from 2009 on early-childhood programs.
The Education Department’s waivers for No Child Left Behind are the best carrots available to Obama for enticing states to close failing schools and make teachers and principals more accountable for student achievement. Without the waivers, most states will face penalties for failing to meet outdated benchmarks. Because Congress has been unable to reauthorize No Child Left Behind, the administration’s waiver program is its only way out. The waiver process has gone smoothly since Duncan rolled it out last year, but the Education Department’s total control over how and when states get them has led to inevitable grumbling that the administration could delay applications for political reasons.
Meanwhile, Obama will likely devote his bully pulpit to higher education. The president wants the United States to again have the highest proportion of college graduates in the world by 2020, and to do that he will need to lean on higher-education institutions to keep their tuition down and their enrollments up. Ironically, neither Congress nor the White House can do much to lower tuition, because most federal college aid goes directly to students. Still, the higher-education law authorizing many student-aid programs expires next year, which will give Congress the opportunity to tinker with the formulas and the White House the chance to talk about it.
By Fawn Johnson
On transportation, Obama can plan on starting his second term the same way he began his first. Then, as now, the funding crisis for the nation’s highways was a few years off but approaching fast. And policymakers still don’t have a strategy for what to do when the current highway authority expires in 2014.
Last year, Congress and the administration managed to put off the toughest decisions about how to finance the nation’s roads and bridges when they passed a mini-highway bill to keep funding at current levels for two years. (Highway bills traditionally last for five years.) The problems that befuddled them then have not gone away. The 18.4-cent-per-gallon federal gas tax cannot keep up with the cost of road maintenance, but too many members don’t want to raise it. A five-year measure costs at least $300 billion, a frightening price tag in an age of austerity. Meanwhile, none of the more sophisticated policy ideas for reworking the system—an infrastructure bank, a plan to replace the gas tax with driver payments based on vehicle mileage—has left the starting block.
Just as in Obama’s first term, budget troubles have pushed a long-term federal infrastructure plan off everyone’s priority list. Obama barely mentioned infrastructure in his reelection campaign, and when he did, it was to revive a suggestion he made a year earlier to use war savings to pay for short-term investment. Meanwhile, the Transportation Department stands to lose about $1 billion if lawmakers don’t reach a deal to avert the fiscal cliff.
A vocal minority in Congress wants to fund federal highways only through the gas tax, which would involve a 35 percent cut in current funding. The Bipartisan Policy Center issued a report in September predicting that such a cut would increase traffic congestion and decrease transit options in metropolitan regions. States might be able to make up about half of the loss for highways through increased tolls and state taxes, the report said, but they could not count on similar mechanisms to fund transit systems. The mess could alter the public ennui that AAA President Robert Darbelnet bemoaned on National Journal’s transportation experts’ blog. “We’ve all been sounding the alarm on this topic for years now, but the public hasn’t engaged,” he wrote. And it seems unlikely that the next year will bring any more clarity about how to pay for transportation.
By James Kitfield
Emerging from the bubble of a domestically focused campaign, Obama will find a world that did not stand still for American politics. And given that his foreign-policy platform focused on little more than withdrawing from Afghanistan and “nation-building here at home,” he won’t have a mandate in this arena.
The Arab Spring began a civil war in Syria that has claimed more than 30,000 lives. During the presidential campaign, the Obama administration essentially held the escalating conflict at arm’s length while the rebels fighting the despotic President Bashar al-Assad became more radicalized, with militant Islamists gravitating to the fight and threatening to turn Syria into a breeding ground for terrorism. So Syria’s neighbors, especially Israel, are especially worried about who will control Assad’s chemical-weapons stockpile. Syria’s sectarian and ethnic violence—Sunni versus Shiite, Kurd versus Arab—has already spilled into Lebanon and Turkey, and it now threatens Iraq. Perhaps most important, key U.S. allies such as Saudi Arabia, Jordan, the Gulf States, and especially Turkey are questioning U.S. leadership. The Obama administration’s assertive efforts this week to unify the Syrian opposition amounts to an admission that the status quo in Syria is unsustainable.
Next year could also prove decisive in the looming confrontation over Iran’s suspected nuclear-weapons program. During the election, Obama went further than any predecessor in taking the defensive option—“containment” of a nuclear-armed Iran—off the table, suggesting that his administration would use preemptive military force rather than allow Iran to acquire the bomb. That was not enough for hawkish Israeli Prime Minister Benjamin Netanyahu, however, who insists that the window for sanctions to deter Iran is closing. His recent U.N. speech warned that by next summer, Iran’s nuclear-weapons program will cross a “red line” beyond which Israel has long threatened to use military force, with or without U.S. participation.
As the world’s superpower, the United States has for decades tried to integrate China into the international order. But a host of factors have recently complicated that task. Both Obama and Romney staked out tough positions on trade with China—an election-season standby that nevertheless annoyed Beijing officials, who hold more than $1 trillion in U.S. debt. China is also in the midst of a once-a-decade leadership transition. Xi Jinping, the nation’s next general secretary, faces destabilizing challenges, from a slowing economy to growing public demand for political reform. Meanwhile, Obama’s strategic “pivot” to Asia has incensed Chinese military leaders, who view it as a form of containment. China has also adopted a belligerent posture toward its claims on disputed islands in the South and East Chinese seas, suggesting that military officers may be taking advantage of the leadership transition to increase their influence.
Trans-Atlantic relations, too, could vex Obama. Although the White House can do little more than dispense advice, a debt default by a eurozone country could plunge the global economy into recession. On the military front, indebted NATO allies continue to cut defense spending to the bone, even after the 2011 Libyan air operation exposed significant shortfalls in their military capabilities. A withdrawal of NATO forces from Afghanistan scheduled for the end of 2014 could become another source of alliance division if, as many experts fear, the Afghan government and security forces cannot take control of their country. Finally, the Obama administration’s pivot to Asia, withdrawal of most forward-deployed troops from Germany, and decision not to lead NATO’s Libya operation has some allies questioning the U.S. commitment to the alliance.
By James Kitfield
War- and recession-weary voters simply didn’t want to hear about Afghanistan during the presidential campaign, and, with few exceptions, both candidates obliged them. Yet a series of setbacks there have decreased the prospect that U.S. and NATO forces will leave behind a stable country in two years. Partly because of inadequate vetting for Taliban infiltration, for instance, Afghan security forces have repeatedly attacked coalition troops, making it difficult to transfer security responsibilities. Attempts to negotiate with the Taliban to end a war almost no one thinks can be won militarily have also failed; insurgents appear to be waiting out the coalition’s 2014 withdrawal.
Between now and then, the administration must set a schedule for pulling out the remaining 68,000 U.S. troops. American military leaders want maximum troop levels, but Obama has rejected their previous requests for a full-court press. His administration must also determine the size of a residual support force to linger past 2014, as well as the number of Afghan troops that Washington and its allies are willing to bankroll once NATO combat operations end. But the administration has not solved two potentially fatal flaws that dog the Afghan strategy: a corrupt Afghan government that has struggled to extend its authority well beyond Kabul, and uncontested Taliban sanctuaries across the border in Pakistan. Many experts now believe the current strategy will lead to a protracted civil war in Afghanistan once NATO departs.
The killing in Libya of U.S. Ambassador Chris Stevens by militant Islamists points to a growing national-security threat: The Arab Spring rebellions have created additional space for Islamist extremist groups to operate. Ansar al-Sharia, suspected in the Benghazi attack, is one of numerous militias that vie with the nascent Libyan government for primacy. Al-Qaida in the Arabian Peninsula, which has launched multiple terrorist plots against the United States, took advantage of political turmoil to seize territory in Yemen. After a military coup toppled the government in Mali this year, the Qaida-linked extremists of Ansar Dine seized power and enforced sharia in the country’s north. Islamist militants in Egypt have attacked police checkpoints in the Sinai and launched cross-border strikes against Israel. Jihadists groups are flocking to the civil war in Syria, threatening to take root inside an increasingly radicalized Syrian rebellion. And al-Qaida in Iraq remains a potent threat to Baghdad’s weak government.
After a wave of cyberattacks against large U.S. financial institutions and the Saudi Arabian state oil company, the Pentagon has pushed Congress for legislation requiring tougher cybersecurity standards at infrastructure facilities in the private sector. Without such safeguards, the United States is vulnerable to a “cyber Pearl Harbor,” Defense Secretary Leon Panetta warned last month.
Closer to home, Obama is trying to shave $487 billion from defense spending over a decade—one of the shallowest postwar cuts in history—without repeating the Pentagon’s 1990s “procurement holiday.” That hiatus left today’s arsenal (much of which dates from the Reagan-era buildup) badly in need of upgrades. Romney chided Obama for overseeing the smallest U.S. Navy since 1917 and the oldest Air Force since 1947. He lost the election, but he had a point.
This article appeared in print as "Just the Beginning."
This article appears in the November 10, 2012 edition of National Journal Magazine.