The Hill: Punting on fiscal matters is irresponsible and reckless
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Punting on fiscal matters is irresponsible and reckless
By Emily Wismer, legislative research associate, Public Notice
As seen in The Hill.
Mayan legend holds the “end of the world” will occur as 2013 begins, spurring apocalyptic catastrophes. In fact, a recent Reuters poll found one in ten people believe the world will end this year. Ironically, like many Americans and ancient Mayans, Washington talking heads believe the end of the world is coming in December. Instead of apocalyptic natural disasters, Washington’s “fiscal cliff” is man made: a series of tax increases scheduled to occur the same time as the automatic spending cuts known as the sequester.
Oddly enough, politicians on the left and right are claiming 2013 will not be unlucky. In fact, they claim, if Washington is going to end its fiscal crisis, reform the tax code, and ensure the safety net of which our grandparents have reaped the benefits, it will happen in 2013. Why? Because post-election politicians will not be as concerned about getting reelected.
So here we are, six months before the fiscal cliff, and Congress is already talking of extending its deadline for reform.
Last month, Senate Finance Chair Max Baucus (D-Mont.) advised a 6-month extension of the 2001/2003 tax cuts until after the elections. Republican House Ways and Means Chair, Dave Camp, agrees 2013 will be luckier, explaining Republicanswill unify behind another complicated mechanism to force comprehensive tax reform later. He says such action will tell potential employers Congress isserious about reform and economic growth.
Huh. I wonder if Congress thinks we won’t see through their effort to procrastinate change. Isn’t the sequester proof promises of future cuts aremuch easier to overturn than enforce? I wonder what gimmick they’ll use now to prove their commitment.
Not superstitious, I question the logic behind there being a magic date of bipartisan cooperation, kumbaya singing, and peace circles.
The last several years, Congress has been marked by neglected responsibilities, delayed decisions, and paralyzing bipartisanship. Despite years of debate, we have not meaningfully reduced the deficit, leveled playing field for families who cannot afford an accountant, or staved off Social Security’s upcoming benefit reductions. It is unfortunate America lost these years of potential economic and fiscal health.
The election is approaching, and it is difficult to get anything done in Congress during an election year. But Americans don’t need convincing: Public Notice recently found 77% of Americans believe tackling government spending is extremely important. Americans crave fiscal responsibility.
This election year is unlike any other, and the longer we wait, the more at unlucky 2013 becomes. Fitch Ratings has threatened to downgrade theU.S. credit rating in 2013 should deficit reduction not take place. If this occurs, the Treasury could have to pay more to convince investors to buy debt, radically impacting the deficit.
Moreover, Europe is keeping creditors from acting on how bad our debt is, but this treatment will not last. Some have argued our reprieve ends next year.
Businesses are scared to invest in this uncertain environment. Unemployment has not dipped below 8.2 percent since January 2009. Employers need Washington to provide certainty to markets sooner rather than later.
Yet ’12 can still be lucky. Leaders in Washington create an illusion there is still work to be done. But most experts know the fiscal crisis’ policy answers are already written. Many analysts believe the President’s Commission for Deficit Reduction’s recommended $4 trillion deficit reduction is the starting place for bipartisanship. On my desk alone, I have stacks of reports from the Peterson Foundation, the Center for American Progress, and the American Enterprise Institute, among others.
Congress by no means lacks answers. Instead, it lacks willpower to address the real drivers of our debt: Social Security takes up 20 percent of all federal spending, Medicare and Medicaid together make up 20 percent, and our nation’s defense (you guessed it) makes up nearly 20 percent. These drive spending, and any meaningful reform must address all.
It is true compromise takes time. It can take a while to garner votes and craft legislation that will pass both chambers. But compromise is a choice, a choice that can be made by individuals in whom America has placed their future. Political posturing for an election to the detriment of our future will not be tolerated in November. Voters will support those who enact real change.
Economic strength begins with putting our fiscal house in order. We must address Social Security, Medicare, Medicaid and Defense spending in a timely fashion. ’12 is our lucky year.
Wismer is a legislative research associate at Public Notice.