Monthly Archives: April 2011
I remember that great scene in “Butch Cassidy and the Sundance Kid” when the two outlaws were forced to jump off a cliff into a raging river below. A fearful Sundance said to Butch, “I can’t swim.” To which Butch replied, “Are you crazy? The fall will probably kill you.” I can’t help think that there is some similarity to any elixir one has to offer to fix the budget deficit. Face the armed posse or jump off a cliff. Some choice.
For now, it is time to turn the page. The last act of a dysfunctional and dishonest 111th Congress is now behind us. The Fiscal Year 2011 budget is finally put to rest, passed halfway through the year that officially started on October 1, 2010. Amid the cacophony of protestations proclaiming the end of the progressive era, a modest reduction to the annual increase was taken. In fact, the actual budget cutting was quite minor. Much of the so-called savings were portions of budgets that were not ever going to be spent.
What the debate did do, however, was set the stage for the 2012 budget showdown to come. And what a battle that is shaping up to be.
The 800 pound gorilla in the room is clearly the issue of reckless deficit spending and its’ concomitant affect on the national debt. There are only so many levers to pull and buttons to push in working towards balancing a budget. We know that the lion’s share of the budget is contained in a handful of program areas. On the entitlement side is Medicare, Medicaid and Social Security. We all know that these are the third rail in politics. We can’t touch the interest on the national debt; we have to pay that. That leaves National Defense as the largest remaining non-entitlement program available.
The remaining budget items make up about 12% of the budget. And that was where a lot of the hullaballoo was focused last week. The Republicans picked a legitimate budget fight but the Democrats were successful in focusing the attention on the draconian cuts to the increases in spending. The debate on social issues was a distraction to the main intent of cutting spending. In the end, the Republicans seemed to win on paper but maybe the Dems got the best of them: actual spending reduction was far less than the advertised $38.5 billion dollars. And with an increase in Defense spending, the net reduction to the 2011 budget was only $353 million over 2010 levels. All in all, we will have a $1.6 trillion deficit this year. All of the hand wringing got us nowhere.
Two things must be tackled simultaneously. Reducing spending is obvious but reducing spending without growing the economy is like death by a thousand cuts. If a rising tide floats all boats, so will a strong economy with real job growth provide the oxygen to fuel the recovery, end this blasted employment recession and restore confidence in an American Century.
So, let the 2012 budget battle begin. Everything is on the table and I mean everything. Every proposal in life is a beginning of a dialog. Government proposals are no different (except maybe that pesky Patient Protection and Affordable Care Act that gave us ObamaCare). The Republican budget proposal offered by Representative Paul Ryan of Wisconsin takes aim at all of the sacred cows in the budget. You may not like it. Those who are seniors and those who intend to become seniors may not like it. Special interests who benefit from tax incentives may not like it. The Pentagon may not like it. Everyone’s ox may get gored but in the words of one notable patriot named Franklin: “If we don’t all hang together, then surely, we shall all hang separately.”
I challenge the parties in Washington to put country first, not special interest. I am not optimistic that fiscal reform will make much progress prior to the Presidential election but the stakes in this game are incredibly high. This is not a game the nation can afford to lose.
When I wrote this piece, Budget Armageddon was at hand. The sun has not yet risen a scant 7 hours later, and it appears that budget catastrophe has been avoided. Details are sketchy but it looks like the focus turned more towards financial issues rather than social issues. There is a short continuing resolution that will feature Congressional debate before the Congress votes to approve this compromise. We will have to be patient as this day breaks to gain full insight into the solution. Notwithstanding the facts of the compromise, the content of this essay remains germane.
The year was 1944 and the Allies had landed at Normandy in June and pressed forward through Western Europe seemingly at will for the next six months. Now comes the dead of winter in Belgium’s Ardennes Forest and the Nazis capitalize on an exposed weakness and severely threaten the entire invasion. When offered a Nazi ultimatum to surrender, General Anthony McAuliffe simply answered, “nuts.” Enter General George Patton. Blood and guts George Patton, who spins and whirls and brings his Third Army into the fight to relieve Bastogne and one General McAuliffe. The Allies, of course, go on to defeat Hitler, win the war and secure the peace on the continent for the next 67 years.
Where is one to stand on this Battle of the Budget? Is there anyone coming to rescue us? Is John Boehner the latter day General McAuliffe saying, “Nuts,” to Senator Reed and President Obama? Or is it the specter of the Tea Party caucus putting those words in Mr. Boehner’s mouth. The problem is we really don’t know what is going on in the negotiations.
If one believes the NY Times, the Republicans are moving the end zone by feigning to fight for fiscal cuts to the budget while their real agenda is one of pressing social agenda issues and neutering the EPA on regulating greenhouse gas emissions. The Wall Street Journal seems to accuse the President of setting up this Battle of the Budget for political purposes of his own. It is an “all or nothing” gambit for the President. He has the power, through Executive Order, to make payments to our servicemen, to our seniors and to other important constituencies if he chooses. He does not. He is picking a fight.
But why fight this seemingly innocuous battle? Could it be that the real culprit in this current drama is not the Tea Party but the Democrats? Is it merely a smokescreen to fight on about a budget that was supposed to be wrapped up 7 months ago by a Congress entirely controlled by Democrats with a Democrat in the White House? If all we were talking about was money, 10, 20 or 30 billion dollars that would be one thing. What we are really talking about is the 2012 budget and the courageous piece of work put forward by Representative Paul Ryan of Wisconsin.
Let us be clear. The budget proposal put forth by Paul Ryan, the Republican budget proposal, is just that: a proposal. It is not necessarily a “Path to Prosperity,” as the subtitle implies any more that the Obama stimulus was the American Recovery and Reinvestment Act.
The Ryan proposal is just a point of departure. It is fraught with risk and uncertainty. It contains optimistic assumptions that stretch out far into the future. What I admire about the proposal is that someone in Washington is actually looking out beyond the next election cycle. In the case of this silly budget impasse that threatens to shut down the government, we are focusing an inordinate amount of attention on a five month spending plan while the real problems of our time are fertilized by our neglect. The Democrats are trying to paint the Republicans, and the Tea Party, in particular, as cold hearted, insensitive demons bent on starving Grandma. What is true is that we are all going to have to let go of some degree of government largess. We do not need it and we cannot afford it. There are bills to pay today that we cannot manage and the bill compounds with each passing budget year.
I used to fear for the future of our grandchildren and our children. It is time to think about fearing for our own future. It is time to demand accountability from our elected officials in Washington and stop with the meaningless and frivolous rhetoric of politics and begin to think about making American exceptionalism more than just a campaign slogan. We needed someone to say, “nuts.” It looks like we got that. I wonder who played the role of General Patton?