Debt Reduction Talk is Like a Ride on a Merry-go-Round that Never Stops

All this round and round babble about debt reduction is a little like getting really hammered and then jumping on a merry-go-round at the state fair. There is a lot of movement and activity, but in the end you go nowhere and the only thing you get is sick. This debt and deficit reduction debate is unusual in that everyone involved – Republicans, Democrats and all of us – are at fault. Everyone bemoans the problem and knows what is required to solve it, but there is a total lack of effective leadership or pressure from the people to do so.

The latest example of this merry-go-round game has been the National Commission on Fiscal Responsibility and Reform. President Obama created this “bipartisan” commission to identify ways to reduce the annual budget deficit in the short term and to bring about “fiscal sustainability in the long run.” The (announced) idea was for this Commission to propose specific spending reductions that would balance the federal budget (excluding interest payments on the debt) by 2015. In addition, the Commission was charged with making recommendations that would, over time, significantly reduce the national debt.

The Commission, under the direction of former Senator Alan Simpson and former Clinton Chief of Staff Erskine Bowles, actually did its job by offering specific proposals that would reduce the federal deficit by $4 trillion in the next decade. But the whole effort was simply a sham perpetrated by a collusion of confusion orchestrated by President Obama and Congress.

From inception, the Commission was structured for failure. While it was portrayed that Congress would be required to act on the deficit reduction recommendations made by the Commission, this requirement to act was rigged because it was triggered only if 14 of the 18 members of the Commission approved and supported the proposals. Of course, the membership on the Commission was stacked in such a way to make it impossible to ever have 14 members in agreement. True to form; when the report of the Commission was released there was a lot of activity and publicity, the horses went up and down and round and round, but only 11 of the 18 members voted to approve the report. As a result, we have circled right back to the corral where the merry-go-round started. And since the recommendations have no force in Congress they will simply fade into the past as have so many other serious ideas for debt reduction.

Out of the Jaws of Defeat comes Victory . . . Well, sort of

But in another sense the Commission did achieve its real objective. It was no coincidence that the Commission report was scheduled to be released on December 1, a full month after the mid-term elections. The promise of recommendations that would be binding on Congress gave cover for President Obama and members of Congress to deflect debate on debt reduction during the election cycle. They could simply say (and did) to “wait for the Commission to make its findings and then we will act.” What a fraud and fiasco!

In reality, the Commission was successful but only by illustrating, once again, the total dearth of serious and effective leadership we have in this country when it comes to the hard decisions that must be made to reduce the deficit and debt. It proves anew (as if we didn’t really already know) that these leaders are only interested in one thing – retaining power.

And the game continues.

Just when you think the debt reduction merry-go-round can’t get any sillier, it does. Take for instance the current interesting (comical if it were not so serious) juxtaposition regarding the debt issue that the Republicans and Democrats are now in. The Republicans won control of the House of Representatives and cut into the Democratic majority in the Senate by lambasting the stimulus legislation passed by President Obama and the Democratic Congress and by making a major issue of deficit spending and the national debt. The number one promise of the Republicans was to “cut spending to the bone.”

So, in this current lame-duck session of Congress, what is it that the Republicans have proposed and browbeat Obama into supporting? It is the continuation of the Bush era tax cuts, the extension of unemployment benefits and a further reduction in taxes by reducing employee payroll taxes; all without any parallel reduction in spending. Cutting away the rhetoric, this legislation is nothing more than a second stimulus bill that adds almost $1 trillion in deficit spending to the national debt! The very two issues the Republicans campaigned against in the election. And how have a majority of the Democrats reacted to this proposal that puts stimulus into the economy, keeps taxes lower for the middle-class and provides a continuing safety net for the unemployed? Issues that have been core to the Democrats – they oppose it. Is it any wonder that we get dizzy on this merry-go-round.

(While many Democrats are furious with President Obama, claiming that he has been hoodwinked into accepting the Republican proposal, there are a rising number of right-wing conservatives who argue that it is President Obama who has done the hoodwinking. They suggest that in exchange for allowing a very small number of “rich people” to benefit from the plan, Obama gets what he wanted all along, which is extension of unemployment benefits and another stimulus for the economy. Two things he could not have moved through the next Congress on their own merits.)

This whole deficit and debt reduction discussion is the equivalent of a football in a never ending football game. One team has the ball for a while and tries to score then the ball is passed to the other team and they try to score. Each team loves the game so much they never want it to end. The only losers in the game are the fans – who are paying to watch – and never demand that the game end.

And the Moral of the Story

You can’t make progress on a merry-go-round. It may seem like progress is being made but all you are doing is going round and round and end up in the same place you started. And, you can’t make progress simply going round and round on the debt and deficit issue. So long as we allow our political leaders to tell us differently and keep taking us for a ride to nowhere, we will have no one to blame but ourselves when the ride ends and the debt comes due. The brass ring, a Congress,  a President and a citizenry who squarely face issues and solves them, will forever remain out of reach.

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