It seems as if fiscal cliff negotiations between congressional Republicans and Democrats will likely spill over into the holiday season. House Speaker John Boehner (R-OH) told members of his congressional caucus not to make plans to go home for the holidays, according to The Huffington Post.
If the two sides do not come to an agreement on a host of budget and fiscal items by January 1, 2013 the United States will very gradually begin to go over the “fiscal cliff”. The disastrous Bush Tax Cuts of 2001 and 2003 would expire and a more than $100 billion “sequestration” would cut funding across the board for the Department of Defense.
Both acts would go a long way toward erasing the vestigial legacy of President George W. Bush. Both the tax increase and the defense cut were popular in the United States until the past few months. Only recently have the political parties and political media begun drumming up fear of a looming “cliff”.
The Bush Tax Cuts were one of the most ruinous fiscal policies ever enacted by a United States government. They are the primary factor responsible for the growth of our debt in the past decade.
The tax cuts were supposed to create jobs and economic opportunity. In truth, the Bush administration oversaw net zero job creation and two recessions – not including the market shock caused by the 9-11 terrorist attacks, warnings of which were ignored by the administration. One of those recession, the one we face today, was the worst economic setback since the Great Depression.
Why are we still fighting to keep these tax cuts?
The vast expansion of the defense budget is also a legacy of the Bush presidency. It is more than 50 percent larger today than it was a decade ago. A sequestration would hurt the Department of Defense, forcing it to reallocate resources and potentially killing jobs with defense contractors. It would also force the armed forces to become efficient spenders, like every other American, and potentially reduce the preposterous amount of abject waste in the Pentagon.
The armed forces were created for our national defense and security. It is not a jobs program. If jobs are lost due to cutbacks of bloated orders for ships and aircraft to fight a non-existent enemy the American people ought to rejoice. The defense and military industrial complex is among the most wasteful and inefficient sectors in the entire economy.
Are Republicans and Democrats really negotiating over who gets to be the most fiscally irresponsible?
In addition to the “fiscal cliff” negotiations, Republicans in the House and Senate are threatening to force the United States Treasury to default on its debt early in 2013. President Obama is committed to not breaking the so-called “debt limit” and has offered concessions to Republicans that cut deeply into Medicare and Social Security in exchange for a one-year increase of the debt limit.
He could simply use the constitutional powers of his office to guarantee that the Treasury not default on its obligations, but President Obama is unwilling to do anything that Republicans consider controversial. Rather than taking away an unprecedented threat, President Obama is hoping to convince an increasingly radical opposition to stop holding the economy hostage.
This negotiation tactic means that retirees will take a beating and American workers will lose even more of the money they paid into federal entitlement programs with the promise that they would receive that money later in life.
Furthermore, it means that the White House will be back to the drawing board in 2014 cutting even more deeply into the social safety net else it allow obstructionist Republicans to destroy the American monetary system.