Wednesday, November 23, 2011

The FAIL We All Saw Coming

Why is anyone surprised? The Supercommittee failed, and it's not all that difficult to figure out the culprit. Look at who was willing to make the painful cuts vs. who wanted to break the bank. It's really not hard to figure out.

Still, it can be perplexing to think about why we even did this in the first place. In today's LA Times, Michael Hiltzik expresses his frustration over Congress missing the point.

There were even more basic problems with the super committee. One was Congress' failure to recognize,
understand or acknowledge that pretty much 100% of the deficit growth going forward stems from rising healthcare costs. Who says so? The Congressional Budget Office, for one, which has projected the federal share of those costs rising to nearly 10% of gross domestic product in 2035 from 5.6% this year.

That points policy one direction: find a way to restrain healthcare costs without imposing undue burdens on the weakest and sickest members of society. A super committee devoted to that goal would have had a crack at creating a lasting economic legacy.

But the central problem was the very notion that deficit reduction is the most pressing fiscal issue facing the country. The super committee — indeed, every sensate being in Washington and across the country — has seen plenty of evidence that the most pressing issue is short-term economic growth.

Pump up growth, and even the long-term deficit begins to take care of itself. In October, the CBO estimated for the House Budget Committee that fully one-third of the deficit projected for 2012 was the result of the economic slump. Put another way, the projected deficit would be $630 billion, not $973 billion, if the economy were operating at full tilt.

Hiltzik then reminded us of what's most effective in reinvigorating the economy. And guess what does it? If you guessed all the programs G-O-TEA Congresscritters hate the most, then you're correct! Extending unemployment benefits, investing in infrastructure, and focusing tax cuts on the working class all help, but Republicans in Congress are blocking it all.

Why? Why do they want to harm the economy and put even more people out of work? Why do they want to risk an even deeper recession?

Well, that's something you have to ask them. And frankly, that's something they should have asked themselves when they set up the framework for this Supercommittee Super-FAIL in the first place.

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