The Fiscal Cliff--Compromising Our Founding Principles and Holding Hostage Our Future

As Democrats and Republicans discuss the media declared "fiscal cliff", there has been seemingly more rhetoric than ideas and more focus on political expediency than on principle. In other words, it's business as usual in Washington. Words such as "compromise" and "hostage" seem to be part of any press conference or speech surrounding the debate. Each party indicates a need for the other party to "compromise" so that a certain group, such as the middle class, is not held "hostage" by the other party's lack of "compromise". The fiscal cliff and the debate surrounding "compromise" and "hostage" holding are not static in our current political debate. Governor Palin was right when she noted last week that we've already reached the fiscal cliff, but what remains to be seen is how hard we're going to fall at the bottom.  The actual compromise is not a potential one between Republicans and Democrats, but the compromise that decades and decades of politicians of both parties have made with our Founding principles. Those who are held hostage are not solely the constituents of the present, but also future generations who will have to pay for the fiscal failures of the past and the present.

 The  media declared, nebulous "fiscal cliff" includes the potential tax increases that would occur if the Bush tax cuts were to expire and the large across the board cuts that would be enacted if sequestration was to occur. If no "deal" is reached, then the combination of tax increases and budget cuts are anticipated by some to exacerbate an already bad economy. In reality, as Governor Palin noted, our nation has already gone over the cliff because of burgeoning deficits contributing to a massive national debt. This is not because of inadequate taxation, but because of big government and poor monetary policy.

Spending has gone up immensely over the past three decades specifically. Per capita spending has gone from  just over $6,000 a year at the beginning of the Carter administration to nearly $12, 000 a year currently. Per capita spending stayed fairly constant at about $8,000 per person through the second part of President Reagan's tenure through President Clinton's time in office before increasing again during President Bush's tenure, as shown below in this graph posted at Reason. com:

The Bush and Obama administrations consistently have spent more than 20% of GDP, which was a rare occurrence in the previous fifty years. Under President Obama, there have been four straight years of more than a trillion dollar deficits, which has lead to his tenure generating more debt than the tenures of the first 41 president (George Washington through George H.W. Bush) combined. Additionally, President Obama has supported quantitative easing stimuli, which have devalued the dollar and negatively affected  both employment and interest rates. While President George W. Bush may have engaged in some pretty extreme "fiscal cliff" diving, Barack Obama has made Felix Baumgartner  seem like a risk averse wimp with the astronomic levels he has gone to in his"fiscal cliff" diving. All of this has lead to the current situation where leaders are trying to determine if our continued fall will include tax increases, mandatory spending cuts, increased borrowing or any combination of the three.

This spending has brought policymakers to a point where charged rhetoric is uttered more frequently than  actual solutions. The word "compromise" is thrown around frequently, which generally means that one party think the other party should abandon their principles to capitulate to them. However, the real "compromise" is one that leaders of both parties have made with our Founding principles of limited government and Founding documents like the Constitution.They all have sworn to uphold the precious document only to treat it as a disposable paper towel when they get in office. They  have compromised their oath for the sake of political expediency. President Obama has indicated that he wants complete authority to raise the debt ceiling  as part of a  "fiscal cliff" deal, which minority leader Nancy Pelosi supports as well. However, the Constitution clearly states that Congress holds the authority to borrow money, not the President. The power of the purse lies with Congress, be it to spend or borrow, yet our leaders continue to try to twist the branches of government where one branch can assume the role of the other and the balance of power becomes moved from its fulcrum.

Additionally, President Washington noted in his farewell address that borrowing money was to be done sparingly and generally only in times of unavoidable wars (emphasis added):

As a very important source of strength and security, cherish public credit. One method of preserving it is to use it as sparingly as possible: avoiding occasions of expense by cultivating peace, but remembering also that timely disbursements to prepare for danger frequently prevent much greater disbursements to repel it; avoiding likewise the accumulation of debt, not only by shunning occasions of expense, but by vigorous exertions in time of peace to discharge the debts which unavoidable wars may have occasioned, not ungenerously throwing upon posterity the burden which we ourselves ought to bear.

President Washington understood something that our recent and current leadership has ignored--who is really held hostage by the political decisions of today--future generations. Today's politicians act primarily out of political expediency recognizing that if they can make the other party seem like a hostage taker to a certain segment of the population, then it helps them politically. However, the hostage is not solely the current taxpayer, but future generations who will be paying for the fiscal failures and bloated government of past and present politicians. As Margaret Thatcher famously noted eventually you run out of other people's money. If debt continues to accrue and the dollar continues to devalue, future generations will have to pay the ransom for their own pre-determined capture.

G.K Chesterston once noted of political compromise, “[c]ompromise used to mean that half a loaf was better than no bread. Among modern statesmen it really seems to mean that half a loaf is better than a whole loaf.” Whatever compromise (or capitulation) Democrats and Republicans come to (if they do), the check for the half loaf will ultimately be sent to future generations held fiscally hostage by the compromised leadership of our recent past and our present. We can only pray that someday our leaders will look to Thomas Paine's words as they make decisions, as Paine said, "if there must be trouble, let it be in my day, that my children may have peace".

Crossposted here and here.

Compromise, Capitulation, and Congress

G.K. Chesterton once said,"[c]ompromise used to mean that half a loaf was better than no bread. Among modern statesmen it really seems to mean that half a loaf; is better than a whole loaf." That line could easily apply to today's GOP controlled Congress. From budget deals where GOP leadership claimed to cut $38. 5 billion  when the actual cut was a mere $353 million to caving on a raise in the debt ceiling and the creation of a "Supercommittee" to deal with spending and budgeting,  the Republicans in Congress have made a habit out of choosing capitulation over principles and legitimate compromise.

Today, an overwhelming majority of House Republicans voted for a "half loaf" balance budget amendment which did not cap spending and too small of a majority of votes to propose tax increases or to override the balanced budget requirements. Some argue that this would be a start towards fiscal prudence, but should such "compromise" be attempted on a constitutional amendment, especially when a better "full loaf" amendment had been proposed by the Senate? To be sure, deficit reduction is an imperative, but if the deficit reduction and spending reduction aren't concurrent, how is supposed to help our economy in both the short and long term? It's a "half loaf" idea when a "full loaf" proposal is on the table.

An example of a solid "half loaf" compromise of sorts, can be seen in the public sector union reforms of Governor Scott Walker of Wisconsin. Governor Walker signed into law a bill that reformed collective bargaining rights of teachers that allowed them to still bargain for pay raises, but not changes to benefits. It also only sought to reform the benefits and bargaining of teachers.  Juxtapose this with the reforms of Ohio Issue 2 which included changes to  all public employee benefits and collective bargain criteria, including that of first responders.To be sure, government employees should have to contribute to their benefits, but the sweeping changes of such a referendum makes it hard to achieve incremental progress that would be necessary for such reforms to be made in a purplish state like Ohio.

Given the choice between principles and capitulation, many in Congress and state governments blur the lines between compromise and capitulation. Principles must be married with pragmatic compromise, but never with capitulation.