Congress’ last-minute New Year’s Day deal on the fiscal cliff averted an economic calamity, but falls far short of putting the country on the right fiscal path.
In its own stumbling, ineffective way, Congress delivered a temporary buffer to immediate economic chaos. The deal maintained current taxes for all but the wealthiest Americans and postponed tough spending decisions for a couple of months.
This isn’t a solution; it’s dangerous, unnecessary political brinksmanship by both President Obama and Congress that barely makes a dent on the revenue side of the deficit equation and misses a grand opportunity to rein in federal spending. All it does is set the stage for more governing-by-showdown moments in the next 90 days over the debt ceiling, the expiration of a continuing budget resolution and pending harsh, across-the-board cuts to many significant federal programs.
Lurching from fiscal crisis to fiscal crisis with stopgap measures in between is not governing. The fact remains that the nation is spending more money than it is taking in, and entitlement programs and other federal expenditures are out of control.
Simply put, the fiscal crisis is going to reach more perilous levels unless Congress and the White House develop spines.
Obama, who won the battle over tax rates, now has to lead the way toward making significant changes to Social Security and Medicare. If the president doesn’t get serious about spending cuts, the debt will continue to grow. If that’s not sufficient motivation, Obama’s national priorities, such as immigration and tax code reform, also will be gridlocked.
The fiscal cliff showdown could have been avoided if a Democratic-controlled Senate had acted on House budget proposals and ideologically driven House members hadn’t wasted two years opposing any deal that included tax increases in a failed effort to defeat the president at the ballot box.
Unfortunately, the latest rounds of political theater haven’t provided any hope that Obama and Congress can accomplish a tax overhaul or Medicare and Social Security reform without another potentially deadly game of brinksmanship.
The nation averted one problem, but Congress and the White House haven’t come close to mapping a course to fiscal stability.