I’ve been doing a lot of thinking about this fiscal cliff thing since the election. If you take a look at the Wikipedia entry for fiscal cliff, you’ll see that if we do nothing, defense spending would decrease as much as other federal government spending – $55 billion a year! Also, the Bush tax cuts for everyone would go away, and significantly more revenue would be generated for the federal government. Social Security and Medicare benefits would not be affected. Medicare payments would be lowered to doctors. I think these are all prudent measures, and together would be an overall win for the country, especially because of the defense spending cuts.
The media has consistently told the story that the cliff would be devastating to the economy, without giving any details. A recent report on Democracy Now told about how corporate interests are pushing for tax breaks for large corporations in the package deal to avoid the cliff. I say let’s just do it and enjoy the fall.
Unlikely that our leaders will let the defense budget be cut by such a large amount, so look for a deal. What we really need, though, is a large reduction in defense spending, accompanied by a large increase in taxes, mostly sin taxes, with carbon taxes and tariffs on imports and exports joining in.
Make sense to you, or do you buy the establishment line on this?
I agree, Bob. Your suggestion has some support on both left and right. Check out this post at conservative redstate.com and these posts at progressive firedoglake.com.
This could be one of those instances when a left-right coalition counters the political establishment.
I also agree. It would be nice if that coalition would be successful, but I’m not holding my breath. The skepticism I got from living in DC for 38 years tells me the lawmakers will probably raise defense spending (it should be slashed much more than mentioned above) and give out more gifts to the greedy corporations and oil companies. The only way that we are going to reach fair compromises is to take the power away from the big money lobbyists, but we know the lawmakers will never do that.
Past is often prologue. Democratic leaders gave away the farm when they cut a deal with Republicans to extend the Bush tax-cuts (during a lame-duck session in 2010, when Dems controlled the White House and both chambers of Congress). That happened again during the holiday season of 2011, when leaders cut a deal to raise the debt ceiling. In both cases, beltway brokers played Santa with the budget and left both progressives and conservatives out in the cold.
We’ve watched this script unfold before. What can we do about it here at the Edge? First, citizens need to inform ourselves and strengthen our grassroots channels of communication. I suggest that people listen to Congressman Peter DeFazio’s response in an interview with Ed Schultz. Pay attention to what DeFazio says (starting at 7:58) about White House messaging on this issue.
“It’s like the election didn’t happen,” he says. If this plays out the way it has in the past, and Dem/Rep leaders cut another elitist deal that leaves the middle class stranded, we should take notes and communicate our views every step of the way. Lets focus attention on the delegates who represent our region — especially Reps. Suzanne Bonamici and Kurt Schrader, who’ll be up for re-election around the bend.
Oregon has a proud history of challenging the political establishment. DeFazio is often a national standard-bearer for that challenge on fiscal matters. Other Oregonians who represent us in DC should follow his lead.
The sad truth is that our representatives don’t matter. If the party in control of the House decides to do something, then they don’t need our representative’s vote. So, the focus needs to be completely on the Senate and the executive. Unfortunately, in the Senate, the filibuster means that our representatives also don’t count. Certainly we don’t count for the executive.
We need revenue, from anywhere and everywhere, and we need to shift spending priorities.
The election did happen, and changed pretty much nothing. We still have a right of center president and a loony Congress. I say, as did Van Halen all those years ago, “Jump!”.
Leaders of both parties must overcome activists in their base who would rather jump than be pushed into a bad deal.
I do not want government to extract more revenues from the middle class. But I do agree with shifting spending priorities. For that we need to bridge the voices that challenge the establishment from both left and right. Even if you think our representatives don’t matter, our congressional districts are indeed a testing ground for that kind of bridge-building.
And if Van Halen can support that effort, surely these dudes can lend a hand.
http://www.youtube.com/watch?v=010KyIQjkTk
Better yet:
http://www.youtube.com/watch?v=BgSyB5xSo2U
Here’s a column that supports Rabbi Bob
Going over the fiscal cliff won’t hurt as much as keeping the same failed tax and budget policies of the past decade, writes columnist Danny Westneat.
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> http://seattletimes.nwsource.com/html/dannywestneat/2019809277_danny02.html
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Nothing in the news to make me change my mind yet. I’m ready to jump.
The most compelling reason to stay put seems to be the child tax credit. Many of my friends don’t want to lose that perk, and neither do I. But this all assumes we don’t do anything after the austerity measures take hold. I believe we have to face reality, and start taking a good look at our spending priorities, and how we get revenue. We need to involve everyone. Right now, it seems to be only two people — Boehner and Obama. Let’s broaden the discussion.
The election is over, but we still have responsibilities as citizens to engage in the political debate. I’ll be darned if I let Obama and Boehner decide the world’s fate!!
Think about the climate or environmental cliff. I can tell you, that one is real, and very steep and deep. The fiscal cliff is like a bunny hill in comparison. Even I can navigate that!
Expiration of unemployment benefits will be a hard hit for many people. The fall will hurt, and both major parties are scrambling to gain control of the narrative if the blame game kicks in.
America can’t keep coming back to a point where leaders behave as if they are forced to negotiate with hostage-takers. We need a balanced budget with spending priorities placed on public need rather than private greed. No deal I’ve seen so far accomplishes that goal.
Public need rather than private greed. Beautiful!
Not sure about the balancing act. We need to work towards a responsible budget, but also towards a long-term clearing of debt, and sustainable, adaptive programs and policies. This necessitates a flexible approach, where some years will bring huge surpluses, and some years will bring huge deficits.
Westneat’s article (see Nancy’s comment above) talks about unemployment benefits. Should be manageable.
We are indeed stuck in a rut in our discussions on the budget. I like Jill Stein’s Green New Deal. I just finished reading about the original New Deal in “The Untold History of the United States” by Oliver Stone and Peter Kuznick (see here for a trailer for the Showtime series). Very interesting.
Here’s my latest column for the Chinook Observer…also looking at the so-called “cliff.”
Fiscal cliff may lead to peace dividend
Now that the election is over, political news is focused on the so-called “fiscal cliff.” It may feel like a cliff to some because the devil’s bargain created by Congress last year calls for automatic, across the board cuts to spending.
I call it a devil’s bargain because our legislators agreed that if the Joint Select Committee on Deficit Reduction, referred to as the Supercommittee, couldn’t come up with a plan to reduce the deficit (and they didn’t), automatic budget cuts would begin in January. This bargain provided short-term gain (and a sigh of relief from Congress) but long-term pain (suffering the consequences through budget cuts, half to military spending and half to all other discretionary spending).
Wickipedia has a long discussion of the fiscal cliff, including this: According to the Congressional Budet Office Historical Tables, defense spending (including overseas contingency operations for the wars in Iraq and Afghanistan) grew from $295 billion in 2000 to $700 billion in 2011, an annual growth rate of 8.2%. Non-defense discretionary spending grew at a 6.6% annual rate during that time, from $320 billion to $646 billion. So roughly half our federal budget, excluding Medicare and Social Security, goes to the military and the other half funds everything else.
There’s some irony in the situation. For example, a 10% cut to the Department of Interior (which includes the National Park Service) will have a big impact on that operation, but it won’t generate that much money, whereas a 10% cut to the military budget will generate a lot of money. The Romney/Ryan budget plan (obviously disavowed by the voters) proposed increasing military spending while cutting everything else. Their plan certainly seemed an old fashioned “might is right” approach to international affairs, especially in light of the US spending more on military than roughly the rest of the world’s countries combined.
All this illustrates a rather ham-handed approach to dealing with federal spending. In most households and most business, across the board cuts are to be avoided because they don’t address inefficiencies, outright waste or whether the activity contributes to the “mission” of the organization. A thorough discussion of values and priorities is a necessary part of good fiscal planning. In a business, profit may be part or the entire “mission,” but in a non-profit setting, including governments, providing a service irrespective of “profit” would be the mission. This is why using a “business model,” i.e. “run it like a business,” doesn’t work for running government. Budgeting and decision-making is simple if all you focus on—or all you care about—is the economic bottom line. An example is the recent judgment against British Petroleum. By focusing only on profits, BP endangered its employees as well as the environment and the livelihoods of many others who rely on the Gulf of Mexico. And now we find out that BP also worked to cover up its systemic irresponsibility.
The “fiscal cliff” has resulted from our federal legislators failure, in some cases refusal, to work toward consensus about what’s important for the country, a failure to study long-term ramifications of decisions made now. For example, is this level of spending on the military the most appropriate? Recently I’ve read that the US is moving rapidly toward, not necessarily energy independence, but independence from mid-East oil. One commentator suggested that, since China is the primary customer now for oil from Saudi Arabia and its mid-East neighbors, perhaps China should take on the military responsibility of assuring that the shipping lanes from that region stay open. If that occurred, the US could reduce its military presence in the Middle East, reduce our human and monetary investment there, and release those resources to repair, rebuild, and expand domestic infrastructure.
Some would argue that such a shift would have negative impacts on our economy because, indeed, a great deal of the US economy is tied up in the military industrial complex. Many of the corporations that do this work, however, have the expertise to do constructive projects stateside. But, as one Bechtel official commented, they’re not in the business of building, but in the business of making money. Getting those organizations to respond to new challenges, perhaps without automatic profit margins, won’t be easy.
It isn’t just the average American who has become “soft” and expects an easy path to a comfortable existence. It is also the corporations that contract with the federal government, sometimes not even having to bid for those contracts, that have developed a sense of entitlement.
This essay was published earlier in The Chinook Observer, the newspaper of record for Pacific County, Washington. Victoria Stoppiello is a north coast freelance writer; you can reach her at anthonyvictoria1@gmail.com.
Thanks for piping in, Victoria. I love the title of your essay. That is basically my argument for jumping off the cliff. We do indeed need to have a discussion in America about our priorities. The current discussion between Boehner and Obama doesn’t begin to include the benefits of a reordering of our priorities towards, as Watt says above, “public need rather than private greed.” We cannot hope to address domestic, or indeed global, needs while attending to the empire. I’m not sure how we’ll disentangle transnational corporations from our government’s business, but this will be necessary in order to get our fiscal house in order.
Thanks for all you do, and please, keep up the writing!