Going Over The (Fiscal) Cliff!

I don’t claim to be an economy expert, but here’s what I believe to be true about the so-called fiscal cliff crisis:

• If nothing is done, going over the “cliff” will probably be bad for the economy…….over the long-term.  But it’s not like the economy is going to instantly tank on January 1st.  So there’s really more time to do something than 30 days.
• Republicans don’t really care if taxes go up for the middle class.  If they did, the current rates would have already been extended.  Republicans say they don’t want taxes to go up for the middle class.  The Democrats agree.  So if that were the case, a bill should pass nearly unanimously.  That it doesn’t means that’s not really the Republicans priority.  At best, Republicans at least think tax cuts for the richest Americans are much more important.  I think reasonable people can disagree on a wide range of issues, but I can’t see how this really can be disputed.  (Granted, you could also argue that Democrats think that tax hikes on the rich are more important than extending current tax rates for the middle class.  To be fair though, we just had a national election where President Obama promised to raise taxes on the richest Americans, and he DID win the popular vote.  So what the will of the people is here should be clear.)
• Serious entitlement reform deserves much more time for discussion and debate than what will be available in this last month for a lame duck Congress.  Programs like Social Security and Medicare need tweaked, but once again these are long-term problems.  Neither Social Security nor Medicare is going to go broke on January 1st.  Since these programs impact ALL of us, any decision regarding major changes shouldn’t be rushed through to meet an arbitrary deadline.
• Speaking of which, solutions that sound too simple to work probably are.  A common solution you hear proposed is raising the eligibility age for Medicare to 67.  According to the CBO, that would create savings of $113 billion over the next decade.  That sounds like a lot, but when you consider that the 2012 deficit is $1.3 trillion and the national debt is over $16 trillion, saving $11 billion a year or so is nothing.  (Congratulations, by reducing benefits to old people, you have solved 1% of the deficit!  Woohoo!)  Also, such a plan would increase the cost of Medicare for participants, as you would be removing the younger, and thus healthier portion, of the pool, leaving the more costly participants in the program.
• We need to start getting to used to the idea these popular programs cost money.  So we just might have to pay just a tad more in taxes.
• The so-called “cliff” was completely manufactured by Congress.  Congress could cancel it tomorrow if they wanted.
• It should be no surprise that Congress is not behaving any differently now as they have the past 4 years.  The bad news is that even after the lame duck session, the players are largely going to be the same, so there’s no reason to think things are going to get better.  At best, we are going to get at least 2 more years of this.  But realistically, thanks to Congressional district gerrymandering, there’s no reason to think that the election in 2 years will change much either.  So I think we are stuck with this crap for a while.

I may be wrong, but I tend to think that it may be best to just go over the “cliff” and then start fresh at the beginning of the year.  Maybe when the tax hikes and spending cuts are actually enacted, public pressure will be exerted that will lead Congress to at least do something more effective.

Related articles

• Geithner: Republicans Will Agree To Tax Hikes On Super Rich (huffingtonpost.com)
• Paul Krugman: GOP Fiscal Cliff Offer ‘Pathetic’ (huffingtonpost.com)
• Over the Cliff (politicalirony.com)
• Why the Fiscal Cliff is a Scam (nakedcapitalism.com)

State Of The Union

I did not (as I usually don’t) watch the President’s State of the Union address.  I just can’t stand the grandstanding politicians that feel like they have to make their feelings known on every little point of the speech, whether it is by applauding and cheering or by making faces.  Yes, adults making faces.  I mean, you tell me?  Could Eric Cantor be trying any harder to make a face like he just smelled a turd?

Now had he made that face after the President’s awful spilled milk joke, then maybe that would be understandable!  I made the same face when I read it!  But no, that was just his ‘I disagree with this guy, I hate this man, why do I even have to be here?’ face.  You know, just in case somebody might get the wrong idea.

The constant applause/cheering interruptions are even worse.  This is a speech that never gets any flow and takes twice as long as it should just because the members in Congress feel like taking an impromptu vote on every thing.  (President: “Today…”, Congress: “Yay!!!!  It IS today!!!!!”)  Would it be so wrong for Congress to stay respectfully quiet and just let the President deliver the address?  There’s plenty of time for actual discussion (instead of applause, groans, faces) after the fact.

So anyway, that was my long-winded way of explaining that I didn’t watch the speech, I read a transcript of it instead.  My general impression is, as just about always with Obama, the man delivers a good speech.  When it comes to the general themes, there wasn’t just a whole lot I disagreed with.  We as a nation absolutely need to get back into the business of making stuff.  There is absolutely too much incentive for companies to move jobs to other nations.  We absolutely need to do a better job of getting the unemployed the skills they need to match up with the jobs that are available.  We absolutely need to invest into this country, into infrastructure and into education.  We need tax reform.  We need a smarter, more efficient government.

But I have come to terms with the fact that as good as President Obama is at delivering speeches, he is just not as good at pushing his agenda (at least his spoken agenda) through Congress and into law.  I think this is where Obama’s lack of experience bites him.  I think Obama sees his job as creating a general vision and setting priorities, then it’s up to Congress to draft up the specifics to fulfill that vision and work on those priorities.  And while that might be a nice notion, that’s not how things work in Washington.  One side is working actively against you, while the other side is too incompetent to help.

I believe this is where my frustration with Obama stems.  In the areas where I agree with him, he is unable to do much without Congressional action.  Now I do realize that it would be tough to do anything with this bunch we have right now (their low approval rating is well-deserved!).  But I do believe that a more experienced statesman could have perhaps squeezed a little more results even out of this group.  On the other hand, the areas where I don’t agree with Obama, those are areas where either Obama can act without Congressional action or where Congress chooses not to take action to prevent the President from implementing certain policies (this is mainly foreign policy/terrorism/civil liberty type issues).  So this is why he comes off as so bad to me, he has no obstacle from implementing policies I don’t like, while he gets stymied from implementing anything I do like.

But I am not sure where else to go.  It’s not like the Republicans are offering an alternative to those policies that I don’t like, and then of course they disagree with Obama’s policies everywhere else.  This is likely going to be a lesser of the two evils type of vote, and boy if the Republicans actually nominate Newt Gingrich, they are going to make that choice easy!

84% Of Americans Thinks Congress Sucks. The Other 16% Misunderstood The Question

Yes, President Obama’s approval rating has fallen with the whole debt ceiling debacle (though really it has pretty much just returned to pre-killing Bin Laden levels).  However, Congress would be overjoyed to have Obama-like approval numbers right now.  The approval for Congress is at its lowest level ever (at least since they started measuring such things).  I actually would love to know what part of the Congressional performance that the 14% is approving.  So Congress finally pushed through a bill to raise the debt ceiling.  But don’t worry Congress, no one is under the mistaken believe that you’ve actually accomplished anything.  Your reputation of being worthless is secure!

• The “crisis” was totally of Washington’s own making.  The debt ceiling only serves as an obstacle to borrowing for spending already approved by Congress.  So Congress is telling the executive branch it must spend money on certain things, but it can’t borrow money to spend that money even if you don’t have the money.  So either way, not raising the debt ceiling means a violation of law one way or the other.
• They were trying to avoid a downgrade in the country’s credit rating.  Friday, Standard & Poor’s downgraded this country’s credit rating anyway.  (Though given Standard & Poor’s own role in this economic mess with their triple-A rating credit default swaps, I’m not sure how much credibility Standard & Poor’s should have.)
• The debt ceiling deal has zero, zilch, nada, a big fat goose egg of things in it that will create jobs and help the economy.  This is our most immediate need, and yet we are doing nothing.
• Not only this, but the current political environment leaves us with almost no options for the government to implement policy that can help create jobs.  Stimulus spending is not politically viable right now.  Most other options include simply extending tax cuts we already have that don’t seem to be working.
• We also don’t have an environment that will allow this country to actually solve the long-term issue of the debt.  Think after this whole mess that both sides are going to actually sit down and put together a plan that will thoughtfully find ways to increase revenue and reform entitlements?

You know, I have heard people say that government is “broken” for a long time.  I am not sure that’s been true in the past.  It has certainly been inefficient and messy.  But things did use to get done.  It looks like we may have reached that point now that government really can’t solve anything.  Not even partially.  It is truly broken.  At least until we start electing representatives that realize that reasonable people can disagree, compromise is not a dirty word, and that slogans, mottoes, and pledges are not the best way to govern.

Related articles

• Jonathan Miller: Credit Downgrade for Dummies (huffingtonpost.com)
• Public disapproval of Congress at all-time high (capitolhillblue.com)
• This Is America’s Most-Hated Congress of All Time [Politics] (gawker.com)
• McCaskill Thinks Congress Sucks (thesource.typepad.com)

So Are We Really Going To Not Raise The Debt Ceiling?

"Boehner needs this putt for all the tax cuts!" "He is going to try to put the ball into the hole, Cotton."

Man, wasn’t the golf game between President Obama and Speaker of the House John Boehner suppose to settle this?  Maybe they should have just made it a winner-take-all match.  Even better, they could have had it broadcast on television.  That would be compelling “reality TV”, right?  Had it simulcast on C-Span 2 and ESPN (perfect for the Ocho!).  Irresponsible you say?  Is it really any more so than the game they are playing even as you read?

The Onion was spot-on with this article:

Congress Continues Debate Over Whether Or Not Nation Should Be Economically Ruined

WASHINGTON—Members of the U.S. Congress reported Wednesday they were continuing to carefully debate the issue of whether or not they should allow the country to descend into a roiling economic meltdown of historically dire proportions. “It is a question that, I think, is worthy of serious consideration: Should we take steps to avoid a crippling, decades-long depression that would lead to disastrous consequences on a worldwide scale? Or should we not do that?” asked House Majority Leader Eric Cantor (R-VA), adding that arguments could be made for both sides, and that the debate over ensuring America’s financial solvency versus allowing the nation to default on its debt—which would torpedo stock markets, cause mortgage and interests rates to skyrocket, and decimate the value of the U.S. dollar—is “certainly a conversation worth having.” “Obviously, we don’t want to rush to consensus on whether it is or isn’t a good idea to save the American economy and all our respective livelihoods from certain peril until we’ve examined this thorny dilemma from every angle. And if we’re still discussing this matter on Aug. 2, well, then, so be it.” At press time, President Obama said he personally believed the country should not be economically ruined.

Brilliant.  I also liked what host Peter Sagal of NPR’s Wait, Wait….Don’t Tell Me said on today’s show.  He said it has been like being on board the Titanic, but with six months of warning. True.  And let me tell you, the American people are not a part of the “better half”.

I hate how this whole process is going down.  I think the debt ceiling raise should be a clean bill with no strings attached.  After all, the reason we need it is due to commitments already passed by the government.  I also think that even though getting the budget balanced and reducing debt are ultimately good things, I don’t think the best way to do that is through a Congressional rush job that is self-imposed.  Finding ways to more efficiently Medicare and Social Security, for instance, are good ideas.  But that deserves thorough thought and debate.  And that should happen before you put a price on the amount of cuts.  I fear a bill will get passed, and then afterwards everyone will try to figure out exactly what was it in.

Republicans are too focused on making Obama a one-term President, consequences be damned.  For my money, Obama places a little too much emphasis on trying to appear reasonable, although it is fair to say that he now can’t get something passed through the House without some Republican help.  Whatever happens, this has already been a failure, regardless of where the blame ultimately lies.

I do have a question.  Why during the five times the debt limit was increased during the Bush administration was it not a big deal?  You didn’t see Senate Democrats demand tax increases in exchange for voting for raising the debt ceiling in 2007, did you?  Or even before this, it seems like before now there was a kind of gentlemen’s agreement that the economy took precedence over political wrangling.  What has happened?

Related articles

• What To Do About the Debt Ceiling (delong.typepad.com)
• Debt Ceiling Kabuki Theater Update (outsidethebeltway.com)

Congress Back In School…Er…I Mean In Session

Ah, Congress is back at work for the country.  What important issue will they tackle first?  Addressing unemployment?  Reducing the national debt?  Reviewing the war efforts in Afghanistan?  So much to do, where to even start?  Let’s see:

Constitution Read For The First Time

They read the Constitution.  Out loud.  Doesn’t reciting stuff seem a little, I don’t know, so Jr. High?  Of course, it wasn’t even that straightforward.  They first had to argue over what sections would be read, what sections would be left out, and even what exactly makes up the Constitution.  Then the parties had to take turns cheering which amendments they actually like (reportedly one Congressman even added a fist pump for the 2nd amendment, yay guns!).  And we had the heckler (class clown?) in the gallery (oh boy, a birther!).  All of that kind of adds to the whole Jr. High vibe.

You know, the lack of maturity shown by people (many of whom have been grown-ups for a very, very long time!) in Congress is one of the things that bother me about our government.  See another grand example of that in a few weeks when the State of the Union speech is made as each party will take turns making asses out of themselves through selective standing ovations, scowls, and other gestures.

Related Articles

• Members of the House try to sit still for a reading of the Constitution. (slate.com)
• Reading the Constitution: Education or futility? (capitolhillblue.com)
• ‘Birther’ disrupts House reading of Constitution (msnbc.msn.com)
• Constitution Reading Provokes Political Tussling (usnews.com)