It's worth remembering the year that led up to the Superfail by the Super Committee earlier this week. Late last year we saw a clear and persuasive proposal of the National Commission on Fiscal Reform, chaired by Alan Simpson and Erskine Bowles. Of course, that was roundly criticized by Congress and the President. Fiscal Year (FY) 2011 spending bills weren't finished on time, and after months of wrangling and threats of government shutdown, FY2010 funding levels were extended for the rest of the fiscal year (five months). Then the Gang of Six promised to save the budgetary day -- nope. Next the debt ceiling debate -- an opportunity to pave the way to a healthier fiscal future -- that instead led to brinksmanship and risk of a fiscally disastrous default on our obligations. And instead of a budgetary compromise (via the Biden budget talks or some other Grand Bargain), we got the Superhero Super Committee.
While the Superbad Super Committee met, precious little was done about FY2012 spending. We are nearly two months into the fiscal year, and only three spending bills are done with nine remaining. The payroll tax holiday expires at the end of the year along with long-term unemployment insurance. The always popular but difficult to pay for alternative minimum tax patch and the Medicare doctor payment fix also expire when the ball drops in Times Square. It's not over. Congress needs to figure out a way forward.
Even in the most harmonious political times, pundits have low expectations of Congress in the year leading up to an election. But we cannot afford for 2012 to be the black hole that 2011 has been in terms of budgetary action and reforms. The nation is $15 trillion in debt and ran a $1.3 trillion deficit last year.
So what should Congress do? Get to work. Stop waiting for another opportunity to blame someone else. The not-so-Superfly Super Committee failed, but they could help move the conversation forward by releasing the specific details of each side's last, best offers. Let taxpayers decide which side was more reasonable, had better ideas, and compromised more.
The savings are there for the taking. We came up with more than $1.5 trillion worth of deficit reduction in spending cuts and eliminating some tax breaks and loopholes. And that didn't include major reform of entitlements and taxes, both of which are necessary and both of which could yield significant deficit reduction and help tame the debt in the long term.
There will continue to be pressure to demonstrate fiscal responsibility.Sequestration, the trigger mechanism that was supposed to force the Superfriends on the Super Committee into a deficit deal, requires a set of across-the-board spending cuts that would cut the budget by $1.2 trillion over nine years starting in January 2013. We've never been a fan of across-the-board cuts because they penalize both the wasteful and the worthy. But Congress set this up to keep their own feet to the fire on debt reduction, and we would strongly oppose its dismantling. Instead of weaseling out of their promise, Congress should get out from under sequestration by doing their job and coming up with enough deficit reduction to make it moot. To his credit, the President haspromised to veto any legislation trying to undo sequestration.
Taxpayers are still waiting for this do-nothing Congress to do something. Americans aren't giving Congress record low approval ratings because of what they've done; they're doing it because of what they haven't.