Tuesday, June 19, 2012

Our Long-term Debt Will Be Fixed If Congress Does Nothing - But Don't Count On that!

DATA DRIVEN VIEW POINT:  According to the Congressional Budget Office information (see below), it appears that if the "do-nothing" Congress actually does nothing the nation's long term debt outlook would significantly improve.  As it stands, temporary tax cuts are set to expire and automatic budget cuts already passed by Congress with bi-partisan support are set to take effect.  As a result of laws already on the books our long-term debt problem is about to be fixed.  But Congress will have none of this! 

Letting the temporary tax cuts expire will anger the Republican political activist, Grover Norquist, and cause him to hold congressional Republicans in violation of his "Taxpayer Protection Pledge."  This, in turn, will cause campaign cash to change course in support of Republican party challengers who will uphold Norquest's tax pledge.  As for the automatic budget cuts set to go into effect, current laws will slow (but not reverse) the rate of our military spending.  Never mind that our military spending is already twice the combined military budgets of the industrial world, this slowing of military growth is completely unacceptable to conservative Republicans. They voted for these automatic budget cuts but they never really meant it. So they are hard at work drafting legislation that would preserve their tax pledge, keep the military rolling in dough and significantly raise the long-term debt of the United States

While the military would have less of a budget increase if the automatic budget cuts go into effect, most other federal programs would actually see significant budget cuts.  Real people would suffer.  Some Democrats are sensitive to this suffering and would support action to prevent it.  Expiration of the temporary tax breaks also disproportionately falls of middle and lower income Americans - this during an election year.  Expiration of the tax breaks wouldn't be fair for most citizens, especially in this depressed economy.  Nor would it be good for Obama's election prospects.  Democrats also believe, not without merit, that spending on jobs right now is more important than long term debt reduction.   Democrats are therefore committed to NOT doing nothing in order to fix the debt problem.  

So who in Congress is for doing nothing right now?  Apparently no one!  It was all just a cynical political mirage from the start and more evidence that we are becoming an ungovernable nation.

The 2012 Long-Term Budget Outlook: Infographic

june 5, 2012
The 2012 Long-Term Budget Outlook Infographic

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