ISSUE IN-DEPTH: FIRST STEPS FOR NEW PRESIDENT TO TAKE: Shun politics in setting policy

Actions speak louder than words, and President Obama’s first 100 days must add policy substance to political eloquence.

He must choose between rewarding constituencies and special interests and demonstrating a thoughtful, practical approach to solving problems. The American people want a leader who puts policy over politics. President-elect Obama will shortly have an opportunity to do just that. Here’s how he can do so in several critical areas:

The economy

Bill Clinton’s tax and spending inclinations were checked by his focus on the famous mantra, “the economy, stupid.” Obama, too, must recognize that this is one area where conditions on the ground trump campaign rhetoric. In what should be a golden age of discovery in areas such as nanotechnology, alternative energy and bioscience, tax policy should encourage innovation, investment and risk-taking. A new “stimulus” package is like throwing good money after bad. An immediate reduction in the capital gains tax rate and a promise to forgo tax increases for at least two years would immediately create jobs, reinflate retirement plans and free up investment and consumer spending.

Spending

The new president’s greatest opportunity to rise above partisan politics and offer real leadership is in addressing the national challenge of looming deficits. He already recognizes “this rising debt is a hidden domestic enemy.” The cost of our political promises is now $455,000 for every household. It’s growing every day. Republicans were swept from power because they not only failed to address this issue, they made it worse. As a good first step, Obama should nominate Warren Buffett and Paul Volcker to work with the nonpartisan Concord Coalition on a long-term plan to remove this crushing debt burden from future generations.

Energy

Domestic energy production and alternative energy research must be a national priority. The president should limit the federal government’s role to supporting pure science and research and development of promising technologies rather than picking winners and losers with subsidies. Imagine what alternative energy technologies might already be available if the billions of dollars wasted on ethanol subsidies had instead been invested in research.

Defense

President Obama should clarify that he will honor the sacrifices made by our armed forces in Iraq by ensuring that an early withdrawal does not jeopardize our hard-fought successes. Even as he increases diplomatic efforts, he must emphasize that diplomacy is enhanced, not harmed, by a policy of peace through strength.

Health care

In pursuing his goal of insuring more children, the new president should take care that government programs do not crowd out employers and individuals already paying for coverage. Previous Medicaid expansions resulted in 50 percent to 75 percent reductions in private-sector health care spending, negating much of the benefits as people flocked to “free” plans.

Transportation

The new administration should announce that it will return control of highway funds to the states, eliminating the costly federal “middle man” and congressional pork, and encouraging local decisions.

Education

Possibly one of the most important aspects of an Obama presidency is not a government program or policy, but the impact of a young president on popular culture. Just as President Kennedy inspired a nation to catch up and overtake the Soviet Union in the “space race,” President Obama can use the “energy race” to inspire the nation to catch up and overtake our competitors in math and science.

At the 2004 Democratic National Convention, Barack Obama gave an exceptional speech filled with optimism and hope. He spoke of an America where “people don’t expect government to solve all their problems” and “the doors of opportunity remain open to all.” Dramatic increases in taxes and regulation stifle both freedom and opportunity.

The first 100 days will clearly answer whether President Obama’s policies match his rhetoric. Let’s hope they do.

> Kelly McCutchen is executive vice president of the Georgia Public Policy Foundation, an independent think tank promoting practical, market-oriented approaches to public policy.