“The single most important thing we want to achieve is for President Obama to be a one-term president.”
– Sen. Mitch McConnell (Oct. 24, 2010)
As Senator McConnell promised, the controlling party has stuck to its goal of having a “one-term Obama”. Republicans in Congress and across the country have carried out a slash and burn strategy that is unprecedented, all the while hiding behind a self-righteous façade of conservative values and populous support that are equally false assertions.
Michael Cohen wrote in The Guardian, “Whether you believe the Republicans are engaging in purposely destructive fiscal behavior or are simply fiscally incompetent, it almost doesn’t matter. It most certainly is bad economic policy, and that should be part of any national debate not only on who is to blame for the current economic mess, but also what steps should be taken to get out from underneath it.”
Yes, we have long-term debt concerns. Yes, we need to undertake reform and reduction of programs from the “entitlements” to defense. Yes, we need tax reform. However, the critical issue is that our economy is suffering the most severely anemic demand since the Great Depression. Fiscal policy is the only real effective tool Washington policymakers have to use. Sitting on their hands, in order to poison the political well for the president is absolutely irresponsible. Likewise, failing to constructively engage on the approaching “fiscal cliff” is unbelievable on the part of both parties but again, it is consistent with the Republicans’ strategy of obstruction.
For the first time in a recovery, policymakers have quashed the role that public spending normally plays in moderating the decline of private sector demand, a choice made in the face of a downturn of epic proportions. Congress has blocked relief for and shifted burdens to state and local governments, forcing drastic cuts in everything from law enforcement to education. Notably again, it is most pronounced in states where Republicans recently gained or strengthened control. Concurrent with starving the state and local public sector, there has been steadfast refusal to consider any national “jobs bills” that might address anemic private sector demand. This is the worst possible combination of action/inaction.
Ironically, by refusing to act, for purely political reasons, Congress has forced the Federal Reserve to act in ways and in a magnitude previously unthinkable. Contrary to the view that the Fed is opportunistically grabbing power, experts argue that the central bankers are reluctant warriors in a war of political inertia and act only because of an absolute lack of responsible fiscal policy action. This, in spite of a concern over the potential for “collateral damage and unintended consequences.” Bernanke et al reportedly see these historic actions as necessary and preferable to doing nothing.
So, the true cost of political obstructionism? By refusing to act responsibly, a recovery that could never have been expected to be robust (given the size of the collapse and the structural elements of the problems that led to it) continues to flounder and the pain of average Americans has been exacerbated heartlessly. By failing to recognize that the mythical trickle-down benefits of high-income tax cuts have yet to materialize, ever, we are frozen out of any rational discussion of how to address long term-deficits and tax reform that would restore domestic and international confidence in our economic future and encourage true investment in the American people. Tragically, by failing to act in the interest of the “true economy,” Congress has ceded all power to the Fed and, derivatively, the banks themselves, while the most conservative factions demonize the Fed and the big banks are seen as the ultimate villains in the tragedy that unfolded beginning in the fall of 2008.
A final note: When asked “are we better off than we were four years ago?” my answer is twofold. Yes, and no. I saw at close range the panic and uncertainty during the days when it was unclear which banks might not reopen in the morning; I saw the credit markets seize up overnight and saw how businesses were suddenly starved for working capital and were forced to “cut or shut.” I know the people whose jobs vanished overnight. So, from my perspective, we are clearly back from the edge and undoubtedly better off than in those dark days. It’s been a long, painful path back and we’re not through it by any means. On the other hand, politically, we have slipped further into the dark ages.
Four years ago, I could not imagine our governmental dysfunction could possibly get worse; on that count I was wrong. It did. We are paying the true cost of that every day.
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