Looking beyond the supercommittee
What's the difference between Congress and the crew of Apollo 13? In the nation's capital, failure is always an option.
So it's no surprise that the congressional supercommittee, delegated to reach some accord where no one else could, has failed to agree on a piddling $1.2-trillion in deficit reduction over a decade.
But it's dispiriting anyway as a stark symptom of the full-body paralysis that prevails just now in Washington. Even with a gun to their heads (in the form of automatic spending cuts), members of Congress can't agree on what practically every reasonable person has already concluded: Uncle Sam has to reduce spending and raise taxes.
That's because our circumstances go far beyond any typical government profligacy. As a proportion of economic output, federal tax revenue hasn't been lower in 60 years, yet spending is at a 65-year high. We can't keep this up. There is simply no way we can redress this imbalance solely by cutting, and until House Republicans find a way to get over their fixation on not raising any taxes on anyone, the nation's fiscal problems will persist, making us weaker all the time.
There is no shortage of blame to go around for the dismal state of our finances; the recklessness of the Bush years, much of it abetted by Democrats, has brought us to this pass. There were unfunded wars, a costly Medicare drug plan, tax cuts, the financial crisis and a recession. But there is no denying that, in dealing with our ensuing fiscal troubles, some Democrats seem willing to compromise on cutting social programs while Republicans have remained foolishly adamant on taxes.
On the other hand, the supercommittee's predictable failure is hardly a catastrophe. Unless Congress changes its mind, there will be $1.2 trillion in automatic spending cuts starting in 2013. These will hurt. But they will reduce the deficit. The committee's failure also removes the likelihood that the Bush tax cuts will be extended past 2012; supercommittee Republicans had been insisting on their extension in exchange for agreeing to any new revenue.
The demise of these budget-busting tax cuts will bring in some $4 trillion over a decade simply by taking income taxes back to where they were in 2000, that halcyon age when the federal budget was in balance. Indeed, letting the cuts expire would be a larger step toward solving our fiscal problems than anything else under serious consideration. To that extent, the supercommittee's failure is everyone else's victory. The only danger is that all this fiscal tightening will set in while our economy is still perilously weak; a little cooperation on the part of Congress might have avoided this possibility, but all we can do is hope growth picks up before the cuts and taxes bite too deeply.
President Barack Obama faces a House of Representatives controlled by sworn enemies, but he can show some much-needed leadership by refusing to extend those costly Bush cuts. He's already said -- quite rightly -- that he'd veto any attempt to undo the automatic budget cuts. The defense cuts in particular are already inspiring theatrical bipartisan breast-beating. Of course, it didn't have to come to this, and there is still time for Washington to shoot the moon on deficits.
All it takes is compromise.