Newt Gingrich was wrong. Last week, he said, “I am watching the ‘super committee’ in Washington with amazement. This is the dumbest idea I’ve seen in a very long lifetime.” Mr. Speaker, please admit it: the “super committee” isn’t the dumbest idea you’ve ever seen. Maybe it’s in the top three, but there’s a lot of competition for the title.
The supercommittee’s failure was supposed to cause panic in the streets. The Defense Department — in the words of each of the Joint Chiefs and Defense Secretary Leon Panetta — can’t stand the effects of sequestration. On the other side, we’ve heard from the OWS crowd — the voice of the White House — that any cuts in entitlements or other domestic spending just can’t be done.
But the failure to reach a deal hasn’t had a noticeable effect on the markets. The news media are talking about it in mild terms. They know the unspeakable secret: that whatever the result, success or failure, cuts or sequestration, the supercommittee results won’t take effect until 2013.
That’s right: the whole thing was set up to give the appearance of spending cuts without the reality. And to give Congress another whole year to mess around with the results. It was a put-up job aimed to increase the debt ceiling without forcing Congress to actually do anything that cuts federal spending.
In short, it was a scam.
To those few who believe that Congress is doing a good job — about 12.3 percent of us, according to the latest polls — let me address a personal question: are you nuts?
There are two — and only two — effects that will felt after the supercommittee’s final failure comes on Wednesday. They are, first, that the whole debt ceiling mess could be hung around Obama’s neck like the Ancient Mariner’s albatross, second, that a bad deal will fall apart.
And what a bad deal it was. In August, Republicans agreed to raise the debt ceiling — for the eleventh time in about ten years — in return for a Democratic promise to bargain in good faith to reduce the deficit. It was a classic “if-then” deal, the kind I warned against in ancient days, about four months ago. Republicans agreed to compromise on the debt ceiling — which had an immediate effect — in return for a promise that the Democrats would do something later. In this case, the something was actually reducing government spending to substantially reduce the federal debt over the next ten years.
And, as in the case of every “if-then” deal that has ever been made, Republicans got snookered. The supercommittee was bound to fail. It presumed that Democrats would bargain in good faith and help reduce the deficit. But the Democrats had no intention of doing so. They insisted, from the beginning, in tax increases to outweigh any spending cuts.
When the deal was made, Obama had gotten what he wanted. The debt ceiling was raised sufficently to enable him to continue his Shermanesque march through our economy. He promptly commenced trying to spend all that he could, proposing another “jobs bill,” which was nothing more than another round of his failed stimulus plan of 2009.
When the supercommittee sat down to work, Obama — as usual — distanced himself from it. Rather than lead the supercommittee to a workable result, he subcontracted his tax hike agenda to the liberals in the group.
Obama didn’t want to get involved because that would entail political risk. At a safe distance, any failure by the supercommittee’s couldn’t be blamed on him.
Which sets the stage for more debt ceiling drama next year. The Dems will staging political theatrics all year, seeking more spending and every possible gimmick and evasion to avoid the sequestration of entitlements. Medicare and Medicaid cuts won’t happen, because Dems will do whatever is necessary — in bits and pieces — to get around them. Whatever the Republicans do, they have already been positioned to be defending the Bush-era tax cuts and defense spending. It will be another round of the “guns vs. butter” debate. On one side will be the Dems demanding to save the children and the poor against the bad old Republicans defending the Pentagon and the “tax cuts for the rich.” It will go ugly early. Maybe as early as this week.
The second result will be that defense spending will be a top-tier issue for 2012.
The massive defense cuts (theoretically) imposed by sequestration will affect everything the Pentagon does next year. Much of what the Pentagon needs to do will be done, but any ability to plan for the future will remain in limbo while Congress debates whether the sequestered spending will be restored, and to what extent. Tens of billions of avoidable costs will be incurred while Congress spends next year sorting things out.
The Army, Navy, and Air Force will not be able to sign long term money-saving contracts for anything from healthcare to new ships and aircraft. Contractors will have to wait through the whole campaign year before they will know what the Pentagon can do.
If Republican congressional candidates — and the Republican nominee for president — play their cards uncharacteristically right, they can defeat the Democrats comprehensively. The question will be whether they can distinguish among the defense spending we need, the defense spending we may want, and the defense spending that the Democrats say we can afford.
A preview of this argument is in a new study by MIT’s Cindy Williams, released on 28 October. Entitled “The Future Affordability of U.S. National Security,” Williams finds that defense spending now comprises about 4.7 percent of our GDP, to which she adds another 1.5 percent that is made up of Homeland Security, veterans’ affairs, and intelligence.
Williams says that the affordability of defense spending should be determined on the basis of five factors:
• Public perceptions of the security threat.
• The degree of debt-induced fiscal and economic risk policy makers are willing to run.
• The level of taxation the public is willing to bear.
• Whether and how much the costs of federal entitlement programs, particularly Medicare and Medicaid, can be reined in; and
• How much money is devoted to running the rest of the federal government.
Notice, please, the complete absence of any mention of what threats we expect our national defense establishment to defer or defeat except as the public’s perception of it can be measured. Notice also the preconceptions that pervade this theory.
Williams apparently believes that defense spending cannot be supported without taxation to fund it, that funding defense is an economic risk rather than a national security issue, and that if entitlement programs cannot be reined in, defense must be sacrificed. As nonsensical as what she writes is, it presages the terms of the debate next year.
Williams comes to the conclusion that affordable defense spending would be between 2.1 and 3.4 percent of GDP.
Defense-minded Republicans should study Williams’s paper carefully. Not because she is right on what defense we can afford, but because it poses the issues they should make their top priority next year.
First, what is the public’s perception of the threats we face? The public has been lulled by the constant tides of war since 9/11. Few Americans look beyond Obama’s withdrawal from Iraq and the planned withdrawal from Afghanistan to believe there is a continuing threat from Islamic terrorism. All the Republican candidates’ protestations that a nuclear-armed Iran is unacceptable fall on deaf ears because we’ve heard it all, from Bush and Obama, so often that those protestations are meaningless.
The public is apparently unconcerned with the vulnerabilities we face. Last week’s cyber attack against a water pumping station in Illinois is a very big deal. Has anyone thought about what we’d suffer if some of our military and intelligence satellites were disabled or even turned against us in a similar attack?
Republicans need to think about what the public needs to know in order to understand what the threats really are. They have to step up and lead the public to an understanding that defense spending is not a question of what we can afford. It’s a question of what we need to spend — based on a thorough analysis of the threats — to deter or defeat them.
Defense spending can, perhaps, be cut. But not before we determine what is fat and what is muscle.
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That’s right, the Grinch (Joe Biden) is coming for your pocketbooks this Christmas season with record inflation. Just to recap, here is a list of items that have gone up during his reign.
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