Supercommittee autopsy

Well, to no one’s surprise the Congressional “subcommittee” failed to come to an agreement last week. Democrats insisted on tax hikes, and Republicans insisted on spending cuts, and so no agreement was possible.

So what are we to make of this? Well, as I noted a few days ago, it hardly matters. If the supercommittee had actually achieved their goal of finding $1.2 trillion in cuts over the next ten years, and if those cuts had been real cuts and not the smoke and mirrors accounting tricks Congress has been producing in recent decades, it still would have made almost no difference to the ballooning federal debt. Nor will the $1.2 trillion over ten years in automatic cuts (“sequesters”) that are now supposed to kick in make any real difference, even if Congress actually allows them to occur (unlikely).

A new poll by Quinnipiac University claims that 44 percent of Americans blame Republicans for the supercommittee's failure, whereas 38 percent blame Democrats. This, notwithstanding the fact that the same poll shows, by a 49-39 percent margin, Americans prefer closing the deficit with spending cuts only. Well, we already know voters are neither consistent nor very smart. If they were smarter they wouldn’t have elected these clowns to office in the first place!

The Democrats wanted to tax “millionaires” another $1 trillion, but couple it with a new $447 billion spending bill, which kind of misses the point of a “deficit reduction” committee. Republicans, on the other hand, adamantly refused to agree to any new taxes, though they were willing to look at simplifying the tax code and getting some extra revenue that way. They probably hold this position for the wrong reasons (party ideology), but I think the position is correct anyway.

In fact, we do need to raise taxes – we simply can’t afford our current government services at our current tax rates, which is why we are borrowing almost half of the federal budget each year and going deeper and deeper into debt. The problem is that Congress, under both parties, tends to use new revenue for new programs rather than for debt reduction, and that would probably have been true in this case as well had the committee agreed to raise taxes. (and in fact the Democrats already had announced what new programs they wanted to spend it on).

Reality is that we need to cut federal spending and/or raise taxes by about $1.5 trillion EACH YEAR just to stop borrowing and halt the growth in the federal debt, let alone pay it back. The only member of Congress who has been admitting that is Rep Paul Ryan (R – Wi), and no one is listening to him.

In the end, of course, we the voters are ultimately responsible for this. These people are only in Washington because we believe their TV ads and insincere promises, or because we blindly vote for our party’s candidate, even if they are incompetent.