The so-called Super Committee is on the brink of failure, if it has not already failed:
The congressional committee tasked with reducing the federal deficit is poised to admit defeat as soon as Monday, and its unfinished business will set up a year-end battle over emergency jobless benefits and an expiring payroll tax holiday.
This failure was completely foreseeable. The gap between Democratic and Republican visions of the economy is too broad.
When I supported the debt deal last August it was not because it was a good deal or because I thought the Super Committee would amount to anything, but because Republicans had become the proverbial dog chasing the car:
But the debt ceiling was an imperfect device on which to mount the effort to change the direction of government. Unlike a “mere” budget impasse resulting in a partial shutdown of government, the debt ceiling holds more risk. I never bought into the August 2 drop-dead date, but I do accept that with $100 billion per month deficits we could not last long after August 2 before collateral effects were felt. Those collateral effects go beyond a debt downgrade (which probably will happen anyway), and include economic dislocation would be hard to predict politically.
So we are, to some extent, like the proverbial dog chasing the car which doesn’t know what to do with it once it catches the car. The car being a failure to raise the debt ceiling for a significant period of time. What would be do with it once we got it?
Negotiations never were going to resolve conflicting visions of the role and expansion of government. Only elections can resolve those competing visions.
So there likely will be no deal. No big deal. It sets up the competing visions of our country’s future quite nicely for November 2012. The electorate can choose Greece if it wants, but I don’t think it will do so.
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Professor, the electorate will ALWAYS choose the ‘Greece’ model because the masses are generally so woefully ignorant of economics.
47% of the populace is effectively getting federal governance for free, while the top 1% pays over 1/3rd of the governance, while the next top 9% pays for another 1/3rd.
The language of ‘entitlement’ that has been used by the Statists for 80 years now has left the populace, strangely enough, feeling “entitled” to things, whether they can be afforded or not. People rarely think beyond their next few weeks even about their OWN finances. Thinking about the federal government’s finances literally blows their mind because of the size and complexity of it, so they merely shut down and say “well it will always be there, so why change and cause myself pain from cutting off programs.”
The debt ceiling fight was, I think, our best shot at forcing through a Constitutional Amendment forcing a balanced budget by a particular “sunset” date. Now, we have no leverage against the Democrat members, since “low income” programs were taken off the table during the sequestration negotiations.
We may be catching up with the car for a second time.
Again? Debt-Ceiling Fight Could Be Back Before 2012 Election
“While economists in August expected the minimum debt-ceiling increase to be sufficient through 2012, analysts now caution that the situation has changed. The European sovereign debt crisis has escalated and its outcome is far from clear. In the United States, the San Francisco Federal Reserve this week put the odds of a double-dip recession in the first half of 2012 at 50-50.
Unlike the financial and economic crises of 2008, which brought Democrats and Republicans together momentarily, a debt-limit fight in a campaign year would be a “very, very messy thing,” said Robert Bixby, executive director of the Concord Coalition, a nonpartisan organization dedicated to fiscal responsibility.”
“But if there’s a recession, Pollack said, “there’s a very good chance” the United States would hit its $15.2 trillion debt ceiling before the end of 2012.
That, he said, would be “really ugly. Really, really ugly.”
http://www.nationaljournal.com/budget/again-debt-ceiling-fight-could-be-back-before-2012-election-20111118
The problem is that the failure to achieve these cuts that are, in the grand scheme, minuscule, triggers a bunch of unpleasant consequences.
Then there’s the issue that the Democrats will win the message wars, meaning that vast swaths of the public, including the all-important indies, will blame the Repubs. That could have serious repercussions in the Senate and House races in 2012.
Unlikely. The Republican message machine has been getting better at framing the debate to make the Democrat members look petty. They’re still not great, but at least better.
Notice how they’ve been getting out in front of the message by saying: we’re willing to discuss raising revenue, but the Democrat members have to be willing to do more than cosmetic changes and give us some real cuts, not merely kick the can down the road.
The Indies are not going to be the problem in the 2012 cycle. At least from here (11 months out) the Independents are breaking 2-1 away from the Democrat party, except on Conservative principles. There are a couple of Conservative Democrat members who do well, and the Liberals all do poorly except where they’ve been gerrymandered in so they will never have another serious fight.
The Republicans already blame the Democrat members. The Liberals and Statists aren’t going to be happy with anything less than a 5% increase on the top 1%, which the Republican CAN’T allow to happen (to do so would mean they get CRUSHED out of the election in primaries and replaced with TEA Partiers.
Well, *you* will know that, because you pay attention, think, and are smartly informed. But the great unwashed, some of whom (God help us) vote, will listen to what Brian Williams (whose parent corp just reported profits of $14 billion without a dime in U.S. taxes) tells them to think. I would love to be wrong here, but every time I actually go out in public and speak to people I don’t otherwise know about issues that strangers don’t ordinarily discuss, I rush home depressed at the level of ignorance.
Come November, we need to vote out all incumbents. It’s unfortunate that we have to wait until then. These guys got us into the mess we are in. We need to get a contract with new congressmen that agrees to Term Limits, Reduction in Government, any laws also apply to them, and possibly more before we will elect them to office.
I’m shocked, shocked, to find stupidity going on in there. Since the only card the Democrats have to play is “raise taxes”, I mean “enhance revenue”, no compromise is possible. They won’t even buy the Republican “let’s eliminate tax loopholes and deductions”, which is unfortunate.
How much did GE pay in taxes? Nothing? and they have a tax credit?
Why raise new taxes when people aren’t paying the old taxes? (Cronyism!)
With respect Professor, your statement that “The gap between Democratic and Republican visions of the economy is too broad.” doesn’t go far enough.
It’s not about the gap between visions of the economy; it’s about the gap between visions of the role of government. The failure of the Super Committee is a manifestation of something bigger. One side sees government as the solution to all of our problems; the other sees government as the cause of all of our problems.
Sadly, the president – with all of his have vs. have-not rhetoric – has made this division worse. As long as the Congress is divided and we have a feckless president, I can’t see any way out of it.
>> The electorate can choose Greece if it wants, but I don’t think it will do so. <<
Based on what? The good judgment they showed in 2008? Or maybe the extraordinary brilliance of Ohioans who voted to repeal the public sector reform law that was necessary to get the budget in order? Or the Pew poll published a month ago in which fully half of the respondents could not name a single Republican candidate running for president?
I wish I had your optimism that voters will do the right thing when they have the chance.
Didn’t those Ohioans, on one hand, reverse the law that would place limits on public sector union bargaining rights, and on the other hand, limit the ability of government agencies to raise taxes? So, where is the money to pay those public sector unions going to come from?
It’s not a fail. It’s a Democrat bear trap stepped into by Republicans. DoD is the target. Their share of budget is minuscule compared to that of other departments and agencies. Equal across-the-board reductions would hurt only DoD, the Democrat target. The committee “failing” is a feature, not a bug, by Democrat planning and Republican poltroonery.
I believe you nailed it. This has always been a way to make the GOP downsize the DOD. They are so bright they knew it ahead of time and still walked right into the dog poo.
The so-called Super Committee is the product of failure .. the failure of Pres**ent Obama and Congressional Leadership to take the servicing of the debt seriously.
Failure begots failure.
True but irrelevant. The public will be/is being told it is the GOP’s fault and the vast majority, who unfortunately vote, will believe it.