Showing posts with label fiscal cliff. Show all posts
Showing posts with label fiscal cliff. Show all posts

Thursday, January 10, 2013

The Difference between Embracing Bipartisanship and Eschewing Obsessive Partisanship


The recently passed fiscal cliff deal was heralded by the media as a "bipartisan compromise".  Democratic Senator Diane Feinstein emphasized that the deal needed a "bipartisan basis". Republican Senator John Boozman called the bill a "bipartisan solution" that would "tackle the financial troubles are country is facing". The bill ultimately received a total of 125 Republicans and 219 Democrats between both the House and Senate. The bill indeed was bipartisan, but what was the price of bipartisanship? Eighty percent of the revenue from the bill will go to President Obama's cronies through incentives and subsidies. The Congressional Budget Office ultimately determined that the touted "balanced approach" really meant that there would be 10 dollars in tax increases for every dollar in spending cuts leading to an additional $4 trillion in deficits.Additionally, the payroll tax holiday expired as part of the deal. It is indeed arguable that the tax holiday shouldn't have existed in the first place, as the holiday could contribute to the insolvency of Social Security. However, allowing that tax holiday to expire while claiming that the deal didn't "raise" taxes is a disingenuous claim by politicians pretending to champions for the middle class while 77% of Americans see less money in their paycheck. In order to face the political reality of a looming, media declared fiscal cliff that would have meant deep across the board spending cuts and tax increases, Congress ignored the fiscal reality of our present and future to spend more... but bipartisanship!

The media has touted the bipartisanship of both President Obama and Governor Chris Christie in recent months as well. President Obama has chosen to appoint former Republican Senator Chuck Hagel to be Secretary of Defense. Hagel supported Obama 2008 candidacy and has taken some stances on Iran and Israel that have made many leery of him as a Defense Secretary. Following the devastation of Hurricane Sandy, Governor Christie embraced and praised President Obama's response while more recently trashing Republicans for ultimately waiting a few days to pass a clean bill for Hurricane Sandy aid, rather than the pork laden bill that Christie preferred. Both of these politicians "sacrificed" in their bipartisanship--Obama his partisan stance for his policy stance and political friendship and Christie his party's purported conservative platform for his political advantage.

Abandoning a party platform (i.e. principle) for the sake of party happens often in politics. It's called obsessive partisanship. Congressman Paul Ryan joined in the aforementioned "bipartisanship" when he voted for the fiscal cliff deal, noting that he "had the guts to vote for it" and that allowing this plan to pass meant that "now we can finally debate spending". However, when Congressman Ryan had the opportunity to "debate spending" when President Bush was in office, he didn't. As I have written before:
He is an intelligent Congressman who has shown leadership in the House on the budget and making strong stances against Obamacare, particularly the IPAB---the unelected board of bureaucrats tasked with managing how Medicare pays. Ryan has served as a Congressman in Washington DC since 1999 and worked for House members for several years during the early and mid 1990s as well. However, despite his strong stance against the Obama administration's profligate spending, he also supported the TARP bailout during the Bush administration and the auto bailout set in motion during the Bush administration.
Paul Ryan is just one example. Individuals on both sides of the aisle are guilty of obsessive partisanship. When President Bush raised the debt ceiling, then Senator Obama called it "a failure of leadership", only to raise the debt ceiling himself in his first term. He is poised to raise it yet again. This is obsessive partisanship. It's one thing for a liberal or a conservative to vote or govern according to his or her principles. It is another thing to abandon one's alleged principles for the sake of party or political expediency.

Thankfully, there are some individuals who have eschewed obsessive partisanship for the sake of maintaining their principles. Sarah Palin is a prime example:
She had garnered a reputation for bucking her own party-- calling out the Alaska GOP chair for doing party business on state time, taking on and defeating an incumbent governor in her own party, cleaning up the ethical mess caused by that incumbent she defeated, and even suing a GOP presidential administration to enable energy development in Alaska.
There are other examples as well. Just this week former Illinois Republican gubernatorial candidate, Adam Andrezjewski filed a lawsuit against Republican comptroller Judy Baar Topinka to make the state of Illinois checkbook publicly available. Topinka had earlier denied Andrezjewski's organization's (For the Good of Illinois) FOIA request. He is suing a member of his own party for the sake of making a state in fiscal shambles more transparent. Making state spending publicly available was embraced by Governor Palin as well and is an example of obsessive partisanship eschewed. When Governor Palin launched that effort in Alaska in 2008, it was praised by both Grover Norquist and Democrat Ralph Nader. She willing exposed the spending she signed into law at the risk of political criticism.

This why pro market, pro transparency populism needs to be embraced. Americans have become jaded to politics where their kids' futures are put in jeopardy because politicians in Washington want to play kick the can for the sake of their own political expediency. Politicians too often point the finger of blame and broken promises only to find that when they point fingers they have three pointing back at them. Is a pro market, pro transparency approach to governance idealistic? Perhaps. Do we deserve it? With our propensity to vote the same folks into office election after election, maybe we don't, but America's future does deserve it. We can't continue to sacrifice our fiscal reality for the sake of our bipartisan, but obsessively partisan political reality.

Crossposted here and here.

Monday, December 3, 2012

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.