Obama offered his version of reform, one that would include cuts in defense spending, loophole-closing tax reform, a probable tax increase on the wealthy, and reforms to Medicare and Medicaid that avoid transforming the fundamental character of the program.  In the speech he defended government programs that support the elderly, the economically disadvantaged and government investment in the economy. He reminded his audience how voters like government services, although they don't often want to pay for them. He said Rep. Paul Ryan's, R-Wisconsin, plan would extend tax cuts for the wealthy while raising the costs seniors must pay for health care. He said, "That's not right and that's not going to happen as long as I'm president."  But Obama has made ringing speeches before against extending the Bush tax cuts and then given ground in negotiations with Republicans. After all, that's why the tax cuts were extended. He will need to draw some lines in the sand after this speech so it doesn't happen again.  In his effort to respond to the Republican challenge on spending, President Obama must be careful not to end up embracing their ideas in the quest for moderate voters during the negotiations.  Despite Obama's defense of government, it is very easy to see how the debate could change quickly. Facing election year pressure, the president could drop some of the proposals that cause too much political controversy, such as his promise not to extend President Bush's tax cuts for the wealthy. We have seen Obama do this before with the extension of the tax cuts during the lame duck session of Congress (as well as on other issues like Guantanamo).  If Obama gives away too many of the proposals that make his a "Democratic" version of deficit reduction, and signs on to too much of Ryan's plan during the negotiations, he would leave Democrats demoralized going into 2012. He would also hand Republicans a massive victory.
In Wednesday's speech, President Obama, in what now has become his classic style, tried to thread the needle.On the one hand, the president joined in the debate over reducing the deficit and debt.On