New York Times: “Legislation that would force Internet retailers to collect sales taxes from their customers has put antitax and small-government activists like Grover Norquist’s Americans for Tax Reform and the Heritage Foundation in an unusual position: they’re losing.”

“For years, conservative Republican lawmakers have been influenced heavily by the antitax activists in Washington, who have dictated outcomes and become the arbiters of what is and is not a tax increase. But on the question of Internet taxation, their voices have begun to be drowned out by the pleas of struggling retailers back home who complain that their online competitors enjoy an unfair price advantage.”

“With Congress and the flying public up in arms over airline delays
caused by Federal Aviation Administration furloughs, lawmakers seem
somehow caught off guard by the extent of the problem caused by the
sequester,” Roll Call reports.

“The flight delays, the furloughs among air traffic controllers, the shutting down of air traffic towers is entirely, utterly unnecessary… This is a willful choice being made by this administration in order to inflict as disruptive a process as possible on the American public and on our economy all to further a political agenda. And the political agenda is to try to convince the American people that there are no circumstances under which we can ever cut spending at all.”

— Sen. Pat Toomey (R-PA), quoted by the Daily Caller, arguing that the sequester is not to blame for flight delays.

“Flights were delayed by up to two hours across the country on Monday,
the first weekday that the nation’s air traffic control system operated
with 10 percent fewer controllers. Pilots, gate agents and others were
quick to blame furloughs caused by mandatory across-the-board budget
cuts, but the Federal Aviation Administration said it was too soon to
tell,” the New York Times reports.

First Read: “For what it’s worth, this is what many in the Obama administration
warned about, but because it didn’t happen in the immediate days after
sequester kicked in, it was seen as hype. Now we’re seeing a PR battle
between congressional Republicans (who want to claim Obama is not
actively trying to avoid sequester fallout with the FAA) and the Obama
administration (which is saying it’s limited in what it can do and need
all of sequester rolled back to right this ship).”

President Obama “will continue a charm offensive with lawmakers this week, planning dinner on Wednesday with a dozen Democratic senators at a hotel near the White House,” Reuters reports.

“Obama has dined twice recently with small groups of Republican senators to try to build what he calls a ‘caucus of common sense’ on fiscal issues, immigration reforms and gun control measures.”

President Obama’s “offer to trim Social Security benefits has perplexed and angered Democrats, but GOP leaders are embracing the proposal and rushing to jump-start a debate that will delve even more deeply into the touchy topic of federal spending on the elderly,” the Washington Post reports.

“The developments signal an important shift in the budget battle as party leaders nervously prepare once again to raise the federal debt limit. After more than two years of talking about taxes and ‘wasteful’ government spending, policymakers appear ready to move into the more serious and sensitive realm of entitlement programs.”

The Cloakroom: Is “entitlement” a dirty word?

“I just think that’s unacceptable. If this passed I would have to reevaluate if I belong in the Democratic Party. If this were passed with Democratic votes, I think it would be impossible to be Democrat.”

— Howard Dean, quoted by BuzzFeed, excoriating the White House over the increased in defense spending in President Obama’s budget proposal.

“Whether or not Republicans ever agree to a budget deal with President Obama, one thing seems certain: now that he has officially put Social Security and Medicare benefits on the negotiating table, opponents on his party’s left will make that an issue for Democrats in the midterm elections next year — and perhaps in the 2016 presidential contest,” the New York Times reports.

“In the midterm races already taking shape, Democrats who back Mr. Obama’s budget proposals to trim future benefits as part of a long-term deficit-reduction compromise could be attacked from the left and the right.”

The Hill: “A growing number of House Democrats are concerned that President Obama’s proposal to cut Social Security benefits will haunt the party at the polls in 2014.”

Robert Shrum: “The Republican jeremiads were expected–but why can’t liberals see the sense in the president’s not-at-all draconian budget proposals?”

NRCC Chairman Greg Walden (R-OR) touched a nerve when he savaged the entitlement changes in President Obama’s budget as a “shocking attack on seniors,” Roll Call reports.

But “it’s the lack of fallout” that may be more revealing.

The debate Walden’s remarks “has set off inside the GOP shows many Republicans harbor deep-seated fears about publicly supporting the entitlement cuts they supposedly back and have demanded Obama and other Democrats embrace since taking control of the House in 2011.”

The Week: Why Obama just can’t win on Social Security.

Ron Brownstein: “The keening on the left about President Obama’s budget proposal this week suggests that large portions of the Democratic base still don’t understand the political and economic dynamics of the party’s changing electoral coalition.”

Joe Klein sees “the tiniest sliver of a possibility that something might get done” on a deficit reduction deal.

“There are those on the left who will object that the deficit issue is overblown and not even a priority among voters. They are right. But we have reached the point where some sort of deal is necessary to restore the public’s, the business community’s and the world’s faith that the U.S. government can, occasionally, take significant action. I predict–tepidly, with no great confidence–that the Congress will finally decide it is time to act.”

John Dickerson: “The Obama strategy relies on theater. There is nothing substantively new about Obama’s budget plan. He has offered versions of the same plan privately to Republican leaders, but now he’s trying to go around those leaders. One requirement for building trust with Republican senators is putting these offers on paper. This is meant to show individual senators that he is making good on the promises he has made in private conversations, but it also offers them the cover they need with their constituents. If senators are going to flirt with tax increases, they have to show their voters that they purchased something in return. Now they can point to the president’s public effort on entitlements. But wait, how do we know that Obama is really making a sacrifice? Just look at how upset his supporters are.”

A new CNN poll finds 42% now say that the $85 billion in across-the-board cuts referred to as the sequester are impacting them personally. That’s up from 35% who said the same in March.

The Week finds “plenty of items in Obama’s budget that many liberal commentators
and Beltway reporters believe Republicans should at least theoretically
be pleased to see.”

The Cloakroom: Republicans move the goal posts again.

President Obama unveiled his budget today and announced “there’s not a lot of smoke and mirrors in here.”

So Politico took him up on the challenge and whipped up “a quick guide to some of the gimmicks that presidents — Democrats and Republicans alike — have used to draft their budgets and how Obama did, too.”

Daily Beast: The five “coolest things” in the president’s budget proposal.

Greg Sargent notes President Obama has included budget items specifically asked for by Sen. Mitch McConnell and Speaker John Boehner “to show he’s serious” but now it’s not good enough.

“In late December, a Boehner aide told Bloomberg News that the Speaker wanted Chained CPI more than other entitlement cuts, such as raising the Medicare eligibility age, as the two were negotiation over a possible cuts-for-revenues swap to avert the fiscal cliff.”

“And in late November, Mitch McConnell explicitly told the Wall Street Journal that if Obama offered entitlement changes such as Chained CPI and Medicare means testing, Republicans would consider new revenue. He actually said this: ‘those are the kinds of things that would get Republicans interested in new revenue.'”

The bottom line: “There is literally nothing that Obama can offer Republicans — not even things they themselves have asked for — that would induce them to agree to a compromise on new revenues.”

John Avlon says that President Obama’s budget released today “is not like all the others. It is not a positional bargaining document, designed simply to rally the base at the outset of negotiations. One way you can tell is that liberal activists and congressmen are already screaming ‘sellout’ at the White House for offering Social Security reform as part of a balanced plan to reduce the deficit and debt.”

“The Republican response so far has been crickets, and that throat clearing you hear in the distance might just be a recalibration before another reflexive ‘tax and spend liberal’ attack on the president.”

National Journal points out “the most important fiscal development of the week will hinge on the success of Obama’s dinner with 12 Republican senators tonight.”

A new Washington Post-ABC News finds 53% of self-identified Democrats view the income tax system favorably while 43% see it unfavorably. That’s a stark contrast to the 66% of Republicans and 62% of independents who have an unfavorable opinion of the tax system.