Now that the debt ceiling debacle is over, I know the rest of us are supremely relieved to know that the Obama administration, having defanged and removed the deficit as a political tool for Republicans (can you pick up my sarcasm? Because I'm laying it on pretty thick), will begin its much heralded pivot to jobs and Winning the Future (WTF) and all that good stuff. So what could that possibly look like?
Here's a couple predictions - a few high-minded speeches, lots of talk of wholly weak policy, and not a lot of Congressional votes or other results. There are mentions of of this new pivot and WTF, some good and some incredibly stupid, but it is all but guaranteed that it will go no where. And a number of the policies that are being floated are completely inadequate and worse, ineffective on their face. Tax credits for hiring people? Really? Businesses have no fucking customers. Tax credits for would-be employers aren't going to do a damn thing when nobody has any money.
On the WTF front, we now have top administration officials endorsing cuts to Medicare and Social Security in order to liquefy those programs into fuel to ensure that the military industrial complex grinds on unvarnished in its current bloated state. That's an odd definition of a victorious future from a Democratic administration - a generation of Americans growing up with an even more frail version of our already pathetic safety net so that we can enjoy the Total Safety afforded by a shitload of tanks and jets and bombs that we don't fucking need.
One of the primary reasons why the much anticipated pivot to jobs/WTF will be little more empty speeches and unkept promises lies in how the Obama administration has once again voluntarily bound its hands politically. In the debt ceiling deal, the parties agreed to create the altogether ridiculous congressional Justice League of sorts to gather 12 members of the non-Justice League congress (3 members per each party, from each chamber) to come together on future deficit reductions. This was part of the Obama administration's olive branch to liberals as he traded trillions of dollars in draconian budget cuts for the promise to once again talk sternly with Republicans about taxes at a future date. Our congressional caped crusaders will have until November to come together on additional deficit reduction measures otherwise a 'trigger' kicks in that will absolutely savage the Pentagon's budget, Medicare payments to healthcare providers, and other unspecified cuts. The idea is to entice Democrats to compromise by threatening general budget cuts, and to get Republicans to compromise by threatening the Pentagon. Yeah...there's just a few problems with this:
Republicans, for their part, are unlikely to appoint anyone who’s publicly supported including revenue as part of a debt deal, namely in the form of tax increases. That would eliminate even fiscal hawks such as Sen. Tom Coburn, who’s made new enemies on the right by saying revenue should be on the table. Many Hill watchers expect the GOP to appoint Rep. Paul Ryan, whose original 2012 budget plan set the hard-line tone for the incoming House Republicans.
Other likely contenders include Sen. Jon Kyl, the minority whip who’s part of the Senate GOP leadership and is retiring in 2012, and Rep. Dave Camp, the staunch conservative chairman of the House Ways and Means committee....“No one from the Senate Gang of Six, who proposed tax increases, need apply,” the Wall Street Journal opined. “The GOP choices should start with Arizona Senator Jon Kyl and House Budget Chairman Paul Ryan, adding four others who will follow their lead.”
On the Democratic side, fiscal hawks and centrists will probably back Senate Finance Committee Chairman Max Baucus, a member of Vice President Biden’s working group. Along with his Democratic colleagues in the Biden group, Baucus was willing to discuss painful spending cuts to Medicaid and food stamps while raising concerns about the impact of such changes to seniors and low-income Americans, according to sources close to the talks.
Weird - Republicans intend to appoint staunch anti-tax mouth breathing zealots, and the Democrats plan on appointing mealy mouthed centrists that value compromise regardless of the cost. And with the administration publicly opposing against any form of measurable defense cuts, what do you think the odds are of our Democratic members of the super congress Justice League pandering hand and foot to the no-new-taxes demands of the intransigent Republicans?
But beyond the fact that the modern Democratic party is filled with a bunch of rudderless pussies, what about the timing of all of this? The super committee is supposed to have its recommendations sent for a vote by November, otherwise the automatic budget cut trigger takes effect. Expect the next three months to be filled with wall-to-wall wrangling and media coverage over the Holy Shit Debt Deal Trigger Armageddon as both parties wring their hands and gnash their teeth and fail to reach agreement up until the very last minute when Democrats inevitably cave in order to avert disaster to the defense budget, because we can never be Completely Safe unless we drop a cool trillion on bombs and stuff. Aw shucks guys, we'll get them on taxes next time, you'll see. This should all sound mind numbingly familiar at this point.
This now takes us to November with less than a year until the 2012 election and the economy still very much hemorrhaging just about any and every sign of positivity or hope, which is a feature of all of this, not a bug. As I have said numerous times before, the Republicans have been using manufactured crises to prevent any real action from being taken on the economy, and the Democrats have happily obliged them by playing along with their infantile antics. So what then? Well lucky for us, the Obama administration feels strongly that the economy will be all rosy and and super awesome come 2013. Why? Just because! By then the confidence fairy will have had a few extra months to sprinkle her magic dust on the free market to get it moving again. This is why the administration feels comfortable with what is very likely to be a very weak pivot to jobs - they have already bought into the ludicrous notion that everything will be booming again come 2013, despite the reams of economic theory and historical precedent that scream the opposite. Economic recoveries following financial crises are painful, slow, and long lasting, even more so when the government sits on the sidelines. It'll be just like the "summer of recovery" leading up to the midterms. And given the circumstances, and the stakes of next year, this seems like an odd time to be thinning the ranks of economists in the White House:
Heading into Obama’s reelection campaign, his group of economic advisers is taking on a shape far different from the earliest days of his presidency, when Obama surrounded himself with some of the best economic and financial minds — experts on economic crises and severe downturns.
Now he has far more people on his team who are steeped in the ways of Washington budget negotiations and debates over spending and taxes...Administration officials say the president has brought in members of the new team — such as Gene Sperling, director of the National Economic Council — skilled at passing economic policy in difficult economic environments. The officials pointed out that many other economists remain, including Jason Furman, a Harvard-trained economist who is Sperling’s top deputy.
In other words, the President has heard everything he needs to hear from prominent economic minds. The recovery is coming, we just need to wait for it, and in the meantime we've got a lot of people that are really savvy in the ways of cutting ridiculously one-sided deals with Republican hostage takers.
Twelve months is an eternity in politics, and anything could feasibly happen between now and then. But for now, I'd say that 2012 is an enormous, terrifying wild card. The American electorate is overwhelmingly stupid and uninformed, and I fear the same voters that gave us the 2010 "shellacking" will be going for a repeat performance in 15 months. The President's advisers have calculated that independents want the government to spend less, but that interpretation is a misguided fallacy. Independents and voters of all stripes want results and economic security, and our current path of head-in-the-sand politics and embrace of austerity are not going to get us there. And when that happens, it's the party in power that bears the voter's anger at the ballot box.
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