The shenanigans surrounding the increase in the debt ceiling are just the kind of politics that drives most of us crazy and contributes to Congress’s historically low approval ratings.
Congress passed laws mandating certain spending, which is funded with revenue from taxes, fees and bonds. Not raising the debt ceiling means not paying our bills, a default that would damage the U.S. and global economies.
In summer 2011 this routine process became a political weapon. Congressional Republicans threatened to not raise the debt limit, although they did so eventually.
Still, Standard and Poor’s rating service downgraded the federal government’s credit rating, explaining the “brinkmanship” meant “the United States is no longer in the top echelon on its political settings.” Perhaps they were recalling Sen. Mitch McConnell’s words: “I think some of our members may have thought the default issue was a hostage you might take a chance at shooting. Most of us didn’t think that. What we did learn is this — it’s a hostage that’s worth ransoming.”
Once again some Republicans declare they won’t raise the debt ceiling if there aren’t major spending cuts with no increase in revenues, even if new funds come from closing tax loopholes.
At the same time, major national business groups, including the U.S. Chamber of Commerce, Business Roundtable and Financial Services Roundtable, are firmly against this political move. Said Chamber President Tom Donohue, “When you get down to defaulting on the debt, you have a very, very serious question: What will happen to interest rates; what will happen to our relationships around the world? It could really hurt the economy.”
Although less harmful than a default, a government shutdown, which would injure the economy, increase the deficit and cost money, could happen just to placate the most extreme elements of the Republican Party. As one top GOP leadership adviser to Speaker John Boehner said, “We might need to do that for member-management purposes — so they have an endgame and can show their constituents they’re fighting.”
Few outside Congress, except for the tea party, now supported by 8 percent of Americans, support these awful options. This same group, which ignores research showing that higher marginal taxes on upper incomes don’t depress the economy, opposed bringing back Clinton-era income tax rates on incomes greater than $400,000. (Back when President Bill Clinton passed those rates, they claimed the economy would crash. Instead it soared.)
Recent deficits and debt are due to the unfunded wars (now being unwound), the Troubled Asset Relief Program, the unfunded 2003 prescription drug law, the auto bailouts (which are being paid back) and the recession.
Long-term, the fiscal situation is more challenging because the U.S. spends a lot on medical care and has an aging population. And despite spending so much, many people haven’t had coverage, and the U.S. has relatively high rates of early death and preventable illnesses.
But the good news is that health-care costs have grown slowly the last three years and Obamacare reforms show promise for cost control, along with more coverage. A public option could do even more.
Congress should recognize that proposals that look like they’d reduce costs can actually make health care more expensive. Cuts in public health allow for serious illness to spread rapidly and increase costs. Raising the Medicare eligibility age to 67 would hurt many, shift costs to people with private insurance and add sicker people needing more expensive care to Medicare. Making it harder for an independent panel evaluating effective health care to operate means public dollars are wasted.
Along with budget shortfalls, the nation has other deficits. Our infrastructure is crumbling. Repairing roads and bridges and expanding high-speed Internet adds jobs and boosts the economy. Education and skills training position us for the future, just as the G.I. Bill built a post-war middle class and thriving economy.
Luckily Maine doesn’t have a congressional delegate prone to hostage-taking. While Reps. Mike Michaud, D-2nd District, and Chellie Pingree, D-1st District, and Sens. Susan Collins and Angus King have their differences, each is pragmatic and experienced.
These four make up what we might call Maine’s “it’s complicated caucus.” And while they might not be able to prevent headstrong ideologues from causing harm, at least they won’t be joining the shenanigans.
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