Posted on 11/15/2011 6:47:08 AM PST by SeekAndFind
Partisan politics will make any meaningful deal difficult to reach.
The so-called Congressional supercommittee — a group of 12 politicians with the unenviable task of reaching a compromise on federal spending and our massive budget deficit — is running out of time.
And so are American consumers and investors hoping for a deal to bolster a struggling economy and prove the stock market rally is here to stay.
Only about a week is left for the group of six Republicans and six Democrats to craft a plan that will slash $1.2 trillion from the U.S. deficit during the next decade. If the debt committee can’t reach a compromise, deep and automatic cuts to Medicare and defense spending will trigger — which either individually or in tandem could be very damaging to an already ailing American economy.
For investors, the firing of these triggers certainly would spook Wall Street. Just look at the 500-point drop in the Dow after the U.S. credit downgrade for an example of how market-moving these kind of big-picture setbacks in Washington can be.
And as the Nov. 23 statutory deadline for the supercommittee approaches, Europe’s deepening debt problems only add to the pressure as investors are focused on politics even more than they are company balance sheets.
There is hope among the Capital Beltway crowd that the pressure-cooker of tense negotiations and high stakes will ultimately force both sides to realize the importance of a deal — even if it is a last-minute one. But the divisive nature of American politics makes most folks very skeptical.
And even if this group of 12 can reach a tenuous deal, there still is the very high hurdle of an up-or-down vote in Congress. The fallout of Election Day 2011 and a heated GOP presidential primary continues to show politicians are heavy on partisanship and light on compromise. That means even if the debt committee goes out on a limb with a pact that is unpopular to many Democrats and Republicans, the party base of either side could easily break that limb by trying to twist the debate more to the left or right to suit their respective bases.
To top it all off, any political agreement from Congress is just that — a political agreement. As a very insightful piece in The New York Times stated on Sunday, it’s not enough for voters and politicians to think they know what’s best. Those dealing in government debts hold a significant amount of power and will show how practical a solution truly is. As Alan Cowell wrote in the Times, “In Greece and Italy, as in Ireland and Portugal before them, unelected bond traders defined the destiny of elected leaders. By week’s end, the market jitters had spread to Spain and France.”
So in a nutshell, the supercommittee has to effectively solve the complicated problem of U.S. debt while catering to intransigent members of their political parties, overly emotional voters and risk-averse global financiers.
Is this all overly pessimistic? Maybe. But consider this: Congress itself thinks there is no way for the debt committee to succeed — and rather than deal with hard decisions or the harsh repercussions of inaction, Sens. John McCain and Lindsey Graham plan to introduce legislation to undo the Budget Control Act and let everyone off the hook.
Ideally this wouldn’t have to happen … but practically, it’s not a bad idea. After all, what’s worse: The automatic spending cuts, or validation that our do-nothing Congress has an utter lack of leadership?
America already has resigned itself to the latter.
Congressional supercommittee will fail because Obama wants it to fail - both Zero and the MSM have been hammering away that it is “the Republicans fault” for not reaching an agreement - there was never going to be an agreement from the get-go.
Are you starting to see why so many Christian businessmen go to bed each night with this final prayer "Lord, this would be a good night to rapture us."
Here it is the middle of November and I still have no idea what next years taxes,health care, and fuel cost are going to be. I don't even know if our Vermont land will even be part of the United States next year.
Looks to me like we’re gonna get screwed again........
The Coming GOP Crack-Up Over the Toomey-Hensarling Tax Hikes
snip:
His plan equates to $1.50 of cuts for every $1 of new revenue, he said. It’s a huge concession for Republicans, he said, considering the bipartisan National Commission on Fiscal Responsibility and Reform had recommended $3 in cuts for each $1 of new revenue.
http://www.hughhewitt.com/blog/
Prepper Ping!
Why? The committee will only waste more of our tax dollars and line their own pockets. This American consumer is hoping they'll shut the government down for the next 14 months.
One small problem. There is no such thing as a ten year budget. I call B.S.
Exactly ... Its B.S. !!
The Dumbocrats when they controll the Congress and can’t pass a budget in 3 years , and then they ‘invent’ a ‘ten year budget’.
Nothing to see here ... move along !
Ignore the man behind the curtain !
Also, since in reality there are close to 80 million taxpayers in the US that number should be bumped up to maybe $13,000 per taxpayer to cover every trillion dollars of debt.
If you have two taxpayers in your household, when the US debt hits 15 trillion your household's part of that will be right at $390,000 (2 x $13,000 x 15).
That's some pretty hefty extortion we're paying! That's like taking on the mortgage for some other family that's living in a *really* nice home! (Without so much as a 'thank you')
what happened to Toomey being a “tea party” guy?
Please, share your happy thoughts!
We can’t cut less than $120 billion per year out of a budget that’s $3.6 trillion now and expected to grow to over $5 trillion in the next ten years due to baseline budgeting, and you have happy thoughts!!!!!
Heck! If we just returned to zero based budgeting and had a spending freeze for ten years, it would save us $9.8 trillion in spending.
WHAT is wrong with our “leaders”?
Well Wob....it appears that we was wearing a “tea party” mask while running for office....once there we see the person behind the mask.
The more things change the more they remain the same... as they say
Has it ever occured to ANY member of the GOP that the first rule of negotiating is to ask for twice what you expect/ That way when you agree on what you wanted in the first place, you have come across as accomodating.
“Congressional supercommittee will fail because Obama wants it to fail - both Zero and the MSM have been hammering away that it is “the Republicans fault” for not reaching an agreement - there was never going to be an agreement from the get-go.”
Worth repeating.
I, for one, would like to know why the Stupid Party never hammers away that it is “the Demonrats’ fault.”
It's like Groundhog's Day. The same damn thing over and over again.
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