Suppose Donald Trump runs for re-election on the Democratic ticket!
After yesterday's new coalition of Trump, Nancy Pelosi and Chuck Schumer plus Trump's indication that he might eliminate the debt ceiling altogether, Trump seems more Democratic than some Democrats. And he clearly left some Republicans (Speaker of the House Paul Ryan and Senate Majority Leader Mitch McConnell) miffed by the Republican president's detour around the party's congressional leadership.
The Trump-Pelosi-Schumer triumvirate got together on a legislative plan that appears to be counter to the Republican Party's interests. Ryan and McConnell wanted to put off debt ceiling and 2018 budget decisions until after the 2018 mid-term elections. Making painful and controversial decisions after the election instead of before would be in the best interests of the majority party. Democrats wanted action sooner rather than later, giving them the opportunity to force Republicans to state where they stand on controversial but essential legislation before Americans go to the polls.
Some Republicans have complained that Trump is not really a Republican, which is true. He is Trump, and what is good for him and his friends is his policy, regardless of partisan concerns. Bipartisanship, if that is what Trump is able to bring about, would be welcomed by many Americans and by some members of Congress in both parties.
Bipartisanship would be helpful in repairing Trump's initiative on immigration. Trump was prompted (by Pelosi) to say some nice things about young immigrants while his attorney general announced the rescinding of the Deferred Action for Childhood Arrivals policy of the Obama administration. Trump tweeted (how else would he make an important announcement?) that the "Dreamers" protected by DACA would have nothing to worry about in the six months before DACA expires under the new policy.
Critics are portraying the administration's decision as a cruel betrayal of these young immigrants brought here illegally as children. But what the administration is doing is forcing Congress to pass DACA-type protections into federal law. It gives Congress six months to pass legislation. There is no guarantee that Congress will do its duty, but there seems to be overwhelming support for providing a means for these innocent young people to avoid deportation. Members of Congress who fail to support a fair and reasonable bill to protect "Dreamers" will face political consequences. A long-sought comprehensive immigration overhaul might even come from this motivation.
Both of these actions this week by the president relates to his impatience and impulsiveness. Trump has been critical of Congress for its failure to pass health care legislation and other important measures. He has accused his own party's leadership of dragging their feet. Most successful businessmen have an impatient streak, and Trump's streak is long and deep. If his impatience gets Congress to start things moving, he could salvage his own failing presidency.
Showing posts with label debt ceiling. Show all posts
Showing posts with label debt ceiling. Show all posts
Friday, September 8, 2017
Wednesday, October 16, 2013
A temporary dodge of long-term issues
The economic crisis might be over. The Senate has voted 81-18 for a compromise plan to get the federal government running again and raise the debt ceiling so that economic chaos doesn't befall the world by the weekend. Assuming the recalcitrant House of Representatives can find a majority in favor of the Senate bill, the crisis will be over.
Popular opinion has it that the Republican Party lost this battle. Speaker of the House John Boehner said as much. The pointless crusade against the Affordable Care Act resulted in the shutdown of the government and a too-close brush with default on the national debt, but the GOP got no concessions on health care. They got a temporary continuation of the funding sequester, but the entire Senate bill is temporary. Funding of the federal government will go on for a couple of months. The debt ceiling will raised enough for the government to pay its debts a little longer. But the long-term problems in Washington have not been addressed.
The Republican delegation had a point that the government cannot continue on its path of borrowing to pay for 30 percent of its expenditures each year. Our deficit spending tops $1 trillion a year, and the federal debt has climbed to about $17 trillion. A bipartisan conference from both houses of Congresses is supposed to meet to resolve this issue in the next few weeks. Such conferences have been tried before. The Bowles-Simpson Commission offered a reasonable but painful route to solvency, but neither the president nor Congress wanted to take the medicine. A super committee two years ago failed to come up with an acceptable budget plan, resulting in the "sequester," which was never supposed to go into effect but only be a frightening consequence no one would allow.
Each year of trillion dollar deficits makes a solution even harder. Compromises must be found in "entitlement" programs such as Social Security, Medicare and programs for the poor. These programs are growing faster than the government's revenue can keep up. Federal money can be found in almost every governmental activity, from municipal housing programs to state highways to farmers' choice of crops. Reducing the federal role in many of these areas could help reduce the deficit. The rate of increase in Social Security and Medicare can be reduced without severe consequences for beneficiaries.
And broader, more sensible taxes should be part of the solution. Fixing this problem will cause pain that should be shared by everyone, and small tax increases can ensure that everyone pays.
To prevent future crises brought about by members of Congress who have carefully drawn safe voting districts, Congress should require that congressional redistricting follow municipal and county boundaries wherever possible, that voting blocs not be packed deliberately to achieve sure victories for one side or the other and that truly bipartisan independent commissions, not state legislatures, draw the congressional districts. With a little more camaraderie and a little less electoral certainty, members of Congress might discover that compromise is better than stalemates.
Popular opinion has it that the Republican Party lost this battle. Speaker of the House John Boehner said as much. The pointless crusade against the Affordable Care Act resulted in the shutdown of the government and a too-close brush with default on the national debt, but the GOP got no concessions on health care. They got a temporary continuation of the funding sequester, but the entire Senate bill is temporary. Funding of the federal government will go on for a couple of months. The debt ceiling will raised enough for the government to pay its debts a little longer. But the long-term problems in Washington have not been addressed.
The Republican delegation had a point that the government cannot continue on its path of borrowing to pay for 30 percent of its expenditures each year. Our deficit spending tops $1 trillion a year, and the federal debt has climbed to about $17 trillion. A bipartisan conference from both houses of Congresses is supposed to meet to resolve this issue in the next few weeks. Such conferences have been tried before. The Bowles-Simpson Commission offered a reasonable but painful route to solvency, but neither the president nor Congress wanted to take the medicine. A super committee two years ago failed to come up with an acceptable budget plan, resulting in the "sequester," which was never supposed to go into effect but only be a frightening consequence no one would allow.
Each year of trillion dollar deficits makes a solution even harder. Compromises must be found in "entitlement" programs such as Social Security, Medicare and programs for the poor. These programs are growing faster than the government's revenue can keep up. Federal money can be found in almost every governmental activity, from municipal housing programs to state highways to farmers' choice of crops. Reducing the federal role in many of these areas could help reduce the deficit. The rate of increase in Social Security and Medicare can be reduced without severe consequences for beneficiaries.
And broader, more sensible taxes should be part of the solution. Fixing this problem will cause pain that should be shared by everyone, and small tax increases can ensure that everyone pays.
To prevent future crises brought about by members of Congress who have carefully drawn safe voting districts, Congress should require that congressional redistricting follow municipal and county boundaries wherever possible, that voting blocs not be packed deliberately to achieve sure victories for one side or the other and that truly bipartisan independent commissions, not state legislatures, draw the congressional districts. With a little more camaraderie and a little less electoral certainty, members of Congress might discover that compromise is better than stalemates.
Wednesday, October 9, 2013
Our dystopian future
Dateline: The not-too-distant future:
It was a stalemate in Congress that initiated the collapse of governing authority, but the basic reasons for the incident goes back further than the unending bickering across party lines in the House and the Senate. Political scientists had already pointed to the computer-based gerrymandering that established uncontested House districts packed reliable voters of one party or the other all across the country. Their safe seats made it easier for these incumbents of either party to push further to the right or left, confident that they couldn't be challenged by an opposition candidate.
And then there was the money in politics and all of the tax-exempt organizations pushing their agendas. It was the nature of these platforms that they grew more and more extreme in an effort to attract attention and followers. They demanded ideological purity and were not afraid to attack their own leaders, should they veer from the extreme policies the organization demanded. As one side ramped up its criticisms, the other side followed suit. These criticisms escalated as the opposing factions' words devolved into personal attacks against their antagonists. Soon, neither side would even consider compromise because compromise came to be viewed as weakness, or even betrayal. Compromise had become a slanderous term.
The sharply divided Congress could not pass a budget, or even a continuing resolution to keep the government afloat, so a partial shutdown led to a broader shutdown with layoffs of thousands of federal workers. The economy began to crumble without the hundreds of billions of dollars of federal salaries and contracts. Restless laid-off federal workers turned bitter and angry. Soon, some of them turned violent. Acts of sabotage against government agencies began. Peaceful protests against the shutdown turned violent, and bank robberies, as well as other forms of thievery, rose suddenly. Understaffed police could not stop or even investigate these crimes, which multiplied exponentially.
Then the debt ceiling impasse forced the United States into default, and the American crisis spread around the world. International trade collapsed because sellers were afraid to accept suddenly suspect American dollars. Banks shuttered their doors, and government deposit insurance in several countries could not meet its obligations. Individuals lost their life savings. Pension funds stopped paying benefits, and Social Security's inflated dollars were not enough to buy food for retirees.
The Constitutional Convention called for by a bipartisan group of senators seemed to be a sensible remedy, but it, too, collapsed into bickering. The group proposing the Constitutional Convention saw it as a way to get the decision-making process away from Congress, which was no longer functioning. The bipartisans proposed just two changes to the 225-plus-year-old Constitution: A clarification that the First Amendment's free speech rights applied to individuals, not to corporations; and a new amendment requiring that congressional districts be drawn by independent bipartisan panels without consideration of incumbents. The thought was that these two changes would eliminate the dominance of political debate by corporations, unions and political action committees, and nonpartisan redistricting would make the U.S. House competitive again, forcing compromises.
It didn't work. The Constitutional Convention was taken over by a secretive group that wrote a new convention eliminating all federal departments except Defense and State and eliminating all of the Bill of Rights except the Second Amendment. The convention also struck the 14th Amendment but retained the 13th Amendment outlawing slavery and the 15th and 19th Amendments granting the right to vote to non-whites and women. It also eliminated the Supreme Court and made federal judgeships elective offices with two-year terms. In the end, the new constitution failed to win ratification by three-fourths of the states, several of whom no longer had a functioning legislature.
By then, much of North America and Europe had become ungoverned with well-armed survivalists ruling small areas and subsistence farmers desperately trying to hold onto the food they had grown for their families against bands of urban marauders roaming rural areas for food and supplies.
It was a stalemate in Congress that initiated the collapse of governing authority, but the basic reasons for the incident goes back further than the unending bickering across party lines in the House and the Senate. Political scientists had already pointed to the computer-based gerrymandering that established uncontested House districts packed reliable voters of one party or the other all across the country. Their safe seats made it easier for these incumbents of either party to push further to the right or left, confident that they couldn't be challenged by an opposition candidate.
And then there was the money in politics and all of the tax-exempt organizations pushing their agendas. It was the nature of these platforms that they grew more and more extreme in an effort to attract attention and followers. They demanded ideological purity and were not afraid to attack their own leaders, should they veer from the extreme policies the organization demanded. As one side ramped up its criticisms, the other side followed suit. These criticisms escalated as the opposing factions' words devolved into personal attacks against their antagonists. Soon, neither side would even consider compromise because compromise came to be viewed as weakness, or even betrayal. Compromise had become a slanderous term.
The sharply divided Congress could not pass a budget, or even a continuing resolution to keep the government afloat, so a partial shutdown led to a broader shutdown with layoffs of thousands of federal workers. The economy began to crumble without the hundreds of billions of dollars of federal salaries and contracts. Restless laid-off federal workers turned bitter and angry. Soon, some of them turned violent. Acts of sabotage against government agencies began. Peaceful protests against the shutdown turned violent, and bank robberies, as well as other forms of thievery, rose suddenly. Understaffed police could not stop or even investigate these crimes, which multiplied exponentially.
Then the debt ceiling impasse forced the United States into default, and the American crisis spread around the world. International trade collapsed because sellers were afraid to accept suddenly suspect American dollars. Banks shuttered their doors, and government deposit insurance in several countries could not meet its obligations. Individuals lost their life savings. Pension funds stopped paying benefits, and Social Security's inflated dollars were not enough to buy food for retirees.
The Constitutional Convention called for by a bipartisan group of senators seemed to be a sensible remedy, but it, too, collapsed into bickering. The group proposing the Constitutional Convention saw it as a way to get the decision-making process away from Congress, which was no longer functioning. The bipartisans proposed just two changes to the 225-plus-year-old Constitution: A clarification that the First Amendment's free speech rights applied to individuals, not to corporations; and a new amendment requiring that congressional districts be drawn by independent bipartisan panels without consideration of incumbents. The thought was that these two changes would eliminate the dominance of political debate by corporations, unions and political action committees, and nonpartisan redistricting would make the U.S. House competitive again, forcing compromises.
It didn't work. The Constitutional Convention was taken over by a secretive group that wrote a new convention eliminating all federal departments except Defense and State and eliminating all of the Bill of Rights except the Second Amendment. The convention also struck the 14th Amendment but retained the 13th Amendment outlawing slavery and the 15th and 19th Amendments granting the right to vote to non-whites and women. It also eliminated the Supreme Court and made federal judgeships elective offices with two-year terms. In the end, the new constitution failed to win ratification by three-fourths of the states, several of whom no longer had a functioning legislature.
By then, much of North America and Europe had become ungoverned with well-armed survivalists ruling small areas and subsistence farmers desperately trying to hold onto the food they had grown for their families against bands of urban marauders roaming rural areas for food and supplies.
Wednesday, August 3, 2011
Wow! We avoided default!
OK, so we beat the debt ceiling deadline by a few hours and will cut spending by more than $900 billion over the next decade. Problem solved? Not at all.
The debt ceiling agreement, which President Obama signed Tuesday, calls for a 12-member commission to cut another $1.2 trillion from the next decade's deficits. But here's the problem. Our annual deficit right now is more than $1 trillion. Cutting a trillion over 10 years amounts to cutting one tenth of the deficit each year. That's the equivalent of paying the minimum payment on a credit card that you've just used to buy a $10,000 vacation. You'll never pay it off!
The commission, to be composed of an equal number of Democrats and Republicans, will have to tackle some spending that no one wants to touch — Social Security, Medicare, federal pensions (including military), defense spending, ethanol subsidies, farm subsidies, federal salaries and other big, popular programs — and it will have to address revenues. There is no way the United States is going to dig its way out of the hole it's in with spending cuts alone. We could eliminate the Defense Department or decimate Social Security and still not have a balanced budget. Increasing revenues will be a necessity, and the Tea Party conservatives have to realize that, regardless of how many "no new taxes" pledges they might have signed.
Revenues can be raised with minimal impact on the middle class. Tax reforms, eliminating some wasteful business deductions and expanding the tax base can generate some additional revenue. Increasing the tax rate for the highest earners can also be done without touching 95 percent of all earners. The home mortgage deduction can be modified so that it doesn't apply to vacation homes or to $1 million mansions.
Perhaps the biggest challenges will be Social Security and Medicare. These popular programs have strong lobbying support, but you cannot effectively reduce the deficit without addressing the programs that consume more than half the budget. These issues should have been addressed 20 years ago; each passing year makes resolution more difficult. Whether the solution is higher payroll taxes, higher full-retirement age, adjustments to cost-of-living increases or some combination, the issue will have to be faced.
Washington's goal should be to eliminate the budget deficit. That won't be done by a couple of trillion dollars in cuts over a decade, and it won't be done without increasing revenues. Rep. Paul Ryan's austere budget proposal does not eliminate the deficit, nor do any of the other plans currently being discussed. A balanced budget amendment will not achieve that goal without monstrous cuts in spending or large tax increases. But unless the goal of eliminating the deficit is addressed, the current $14.3 trillion federal debt will keep on growing.
The debt ceiling agreement, which President Obama signed Tuesday, calls for a 12-member commission to cut another $1.2 trillion from the next decade's deficits. But here's the problem. Our annual deficit right now is more than $1 trillion. Cutting a trillion over 10 years amounts to cutting one tenth of the deficit each year. That's the equivalent of paying the minimum payment on a credit card that you've just used to buy a $10,000 vacation. You'll never pay it off!
The commission, to be composed of an equal number of Democrats and Republicans, will have to tackle some spending that no one wants to touch — Social Security, Medicare, federal pensions (including military), defense spending, ethanol subsidies, farm subsidies, federal salaries and other big, popular programs — and it will have to address revenues. There is no way the United States is going to dig its way out of the hole it's in with spending cuts alone. We could eliminate the Defense Department or decimate Social Security and still not have a balanced budget. Increasing revenues will be a necessity, and the Tea Party conservatives have to realize that, regardless of how many "no new taxes" pledges they might have signed.
Revenues can be raised with minimal impact on the middle class. Tax reforms, eliminating some wasteful business deductions and expanding the tax base can generate some additional revenue. Increasing the tax rate for the highest earners can also be done without touching 95 percent of all earners. The home mortgage deduction can be modified so that it doesn't apply to vacation homes or to $1 million mansions.
Perhaps the biggest challenges will be Social Security and Medicare. These popular programs have strong lobbying support, but you cannot effectively reduce the deficit without addressing the programs that consume more than half the budget. These issues should have been addressed 20 years ago; each passing year makes resolution more difficult. Whether the solution is higher payroll taxes, higher full-retirement age, adjustments to cost-of-living increases or some combination, the issue will have to be faced.
Washington's goal should be to eliminate the budget deficit. That won't be done by a couple of trillion dollars in cuts over a decade, and it won't be done without increasing revenues. Rep. Paul Ryan's austere budget proposal does not eliminate the deficit, nor do any of the other plans currently being discussed. A balanced budget amendment will not achieve that goal without monstrous cuts in spending or large tax increases. But unless the goal of eliminating the deficit is addressed, the current $14.3 trillion federal debt will keep on growing.
Friday, July 29, 2011
Jihadists of the right in Congress
Osama bin Laden always said he wanted to destroy America's economy (presumably to set it back to the seventh century, when Islam began). While he never achieved that goal in his lifetime, he'd probably take some pride in the work of the Tea Party conservatives in Congress. These yahoos are so determined to make their point about government spending that they're willing to risk economic catastrophe for the federal government, state and local government, domestic and foreign investors, car makers, home buyers and ordinary consumers. Enough of them are willing to allow a historic government default on its debt that they are rejecting not only the Democrats' proposals to raise the national debt ceiling but even their own party leadership's plans.
Call them "enablers" of al-Qaida or "fellow travelers" or whatever the operative phrase is in this post-Cold War world. They are making themselves the jihadists of the right wing. They can destroy the American economy without blowing up any skyscrapers or hijacking any airplanes, but their impact on the economy could be worse than anything that happened 10 years ago on 9/11. They even share some traits with the Islamic terrorists who wish to destroy us economically or any way they can — zealotry for their cause, unwillingness to compromise, contempt for their opponents and blind allegiance to their vision for the world.
The American military finally got bin Laden, who had threatened to destroy America. Now this country faces destruction from another group vowing to "save" America by pushing it off an economic cliff.
Call them "enablers" of al-Qaida or "fellow travelers" or whatever the operative phrase is in this post-Cold War world. They are making themselves the jihadists of the right wing. They can destroy the American economy without blowing up any skyscrapers or hijacking any airplanes, but their impact on the economy could be worse than anything that happened 10 years ago on 9/11. They even share some traits with the Islamic terrorists who wish to destroy us economically or any way they can — zealotry for their cause, unwillingness to compromise, contempt for their opponents and blind allegiance to their vision for the world.
The American military finally got bin Laden, who had threatened to destroy America. Now this country faces destruction from another group vowing to "save" America by pushing it off an economic cliff.
Wednesday, July 27, 2011
Coming next week: financial cataclysm
Six days from a fiscal cataclysm, Speaker of the House John Boehner can't keep enough of his GOP colleagues in the fold to pass his own legislation to raise the debt ceiling. Over on the Senate side, Majority Leader Harry Reid has thrown in the towel and is offering a half-hearted bill to raise the debt ceiling in return for some ephemeral spending cuts and no increases in revenue.
I watched President Obama's and Boehner's Monday night addresses — Boehner's live and Obama's via the Internet — and thought Obama came across more genuinely. Boehner made his political points but wasn't entirely honest in talking about a "bipartisan" House proposal and accusing Obama of wanting a "blank check." Boehner probably fired up the right wing while Obama was seeking a broader appeal, and he likely succeeded. His call for compromise was one most Americans would welcome, and although he couldn't resist parroting the Democrats' catch phrase about the rich paying their "fair share" of taxes, Obama's overall point was well taken. Obama was on much sounder ground and more persuasive in arguing that all Americans should share in the sacrifices necessary to get our fiscal house in order — the wealthy should feel the pain just as much as the poor who lose federal services or the middle class who pay more for college loans.
If this impasse continues and we get to next Wednesday with no debt ceiling bill in place, we will all regret it. America's credit rating will fall, and interest rates will rise. Our payments on the national debt will rise, and that will create even more federal debt or dismembering cuts to federal spending, including Social Security. Interest rates on mortgages and consumer loans will also rise, and that will throw us back into a deeper recession as home sales and car sales collapse. Business loans will be more expensive, and that will curtail jobs. The dollar will fall, and that will mean higher prices.
To the freshman Republicans who have vowed not to raise the debt ceiling, no matter what, and have fought any inclination Boehner might have to compromise, I can only ask: Are you happy yet? If all of this transpires, Democrats will be able to run in 2012 under the slogan "We're not crazy!" Of course, remembering Democratic congressmen Weiner and Wu, Republicans can counter with "We're not perverts (or at least haven't been caught at it)."
I watched President Obama's and Boehner's Monday night addresses — Boehner's live and Obama's via the Internet — and thought Obama came across more genuinely. Boehner made his political points but wasn't entirely honest in talking about a "bipartisan" House proposal and accusing Obama of wanting a "blank check." Boehner probably fired up the right wing while Obama was seeking a broader appeal, and he likely succeeded. His call for compromise was one most Americans would welcome, and although he couldn't resist parroting the Democrats' catch phrase about the rich paying their "fair share" of taxes, Obama's overall point was well taken. Obama was on much sounder ground and more persuasive in arguing that all Americans should share in the sacrifices necessary to get our fiscal house in order — the wealthy should feel the pain just as much as the poor who lose federal services or the middle class who pay more for college loans.
If this impasse continues and we get to next Wednesday with no debt ceiling bill in place, we will all regret it. America's credit rating will fall, and interest rates will rise. Our payments on the national debt will rise, and that will create even more federal debt or dismembering cuts to federal spending, including Social Security. Interest rates on mortgages and consumer loans will also rise, and that will throw us back into a deeper recession as home sales and car sales collapse. Business loans will be more expensive, and that will curtail jobs. The dollar will fall, and that will mean higher prices.
To the freshman Republicans who have vowed not to raise the debt ceiling, no matter what, and have fought any inclination Boehner might have to compromise, I can only ask: Are you happy yet? If all of this transpires, Democrats will be able to run in 2012 under the slogan "We're not crazy!" Of course, remembering Democratic congressmen Weiner and Wu, Republicans can counter with "We're not perverts (or at least haven't been caught at it)."
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