11.19.2011 0

Supercommittee: Debt Deal Failure

The Super Committee

The members of the Super Committee

By Rick Manning — Sometimes you really don’t want to be right.

Unfortunately, that is the situation which I find myself in as the child of the debt deal, the Supercommittee, is due to submit its recommendations to cut a meager $1.2 trillion off of the national debt in the next ten years.

Mind you, the cut is not from the current $15 trillion in national debt, but instead is from the projected budget deficit of almost $23 trillion in fiscal year 2021.  So don’t be worried big government types, even if the Supercommittee reaches the magic number of $1.2 trillion in “cuts,” government deficits will still grow by $6 trillion in the next ten years.

Shockingly, the Congressional Budget Office projects that every category of government will grow every year through 2021 with the rate of growth virtually unabated.

By any reckoning, even if the Supercommittee “succeeds” they will have failed the nation by not actually dealing with the budget problem and most likely making it worse.

In the “No Deal Better than a Bad Deal” article published a few hours prior to passage of the legislation that allowed the nation’s debt ceiling to be raised, I wrote about four failings of the debt ceiling deal that we will see come to light in the next few days:

  1. If followed, the debt deal guarantees a tax increase, because the Congressional Budget Office projections are based upon the presumption that taxes will rise in 2013 with the expiration of the so-called Bush tax cuts.
  2. Automatic cuts that are enacted starting in 2013 if the Supercommittee proposal doesn’t pass Congress, almost certainly guarantee additional tax increases.  Congressional Republicans are likely to find the automatic Defense Department cuts untenable, and congressional Democrats are equally unlikely to budge without tax increases as an offset.  Expect additional tax increases beyond those related to the expiration of the Bush tax cuts.
  3. The deal did not allow Medicare to be cut, locking in the dramatic expansion of Medicare benefits to families making as much as $64,000 a year under the first two years of the Obama Administration.
  4. The predicted credit downgrade already occurred with more likely to come.  The short-term effects of the U.S. debt downgrade were insulated by the collapse of sovereign debt value in Europe, and a flight to relative safety that has accompanied that collapse.   However, as U.S. debts continue to skyrocket to southern European levels, the debt deal will be pointed to as the last opportunity this Congress had to head the U.S. debt bomb off at the pass.

As predicted, Democratic leaders are now looking at the automatic sequestration options as more desirable than any Supercommittee proposal that does not include massive additional tax increases.

Few remember the dire predictions surrounding failure to pass a debt ceiling increase back in August, 2011, but many are going to note that the solution failed on every count.

The Supercommittee solution merely got our nation past the debt ceiling crisis, but was destined to fail from the outset.

In spite of best efforts by Republican leaders like Representative Jim Jordan (R-OH) and Senator Jim DeMint (R-SC), the opposition to serious cuts by President Obama and Senate Majority Leader Harry Reid (D-NV) were too difficult to overcome.

Due to Obama and Reid’s slavish devotion to deficit spending our nation’s budget is a fiscal train wreck that actually grew by 5 percent this past year in spite of all the talk about cutting the budget.

A full year after the 2010 electoral revolution in favor of cutting the size and scope of government, the wheel of big government grinds on unabated.

2012 may well represent the last chance for our nation to elect representatives who will honestly tackle the budget deficit that is strangling America.  Until then, we will continue to watch the Washington, D.C. kabuki theater that the Supercommittee represents.

Rick Manning is the Communications Director of Americans for Limited Government. You can follow him on Twitter at @RManning957.

Copyright © 2008-2021 Americans for Limited Government