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Super committee is latest in a long line of debt solution attempts
Sen. Jon Kyl (R-AZ), a member of the super committee, talks with reporters outside his office in the U.S. Capitol on November 19, 2011 in Washington, DC.
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Jeremy Hobson: Barring a last minute break through, the so-called Congressional super committee will report failure this morning -- failure to agree on $1.2 trillion in deficit savings over ten years. The spin today will likely be that after the next election, it'll be easier for lawmakers to agree on a plan for the nation's finances.
But as Marketplace's Washington bureau chief John Dimsdale reports, we've heard that before.
John Dimsdale: The super committee was born out of last summer's crisis over increasing the government's authority to borrow. Despite dozens of high-level meetings between the White House and Congressional Republicans, the two sides could not find deficit reduction common ground.
Before that, there was the Gang of Six bipartisan Senators who tried unsuccessfully to bridge the differences. And that Gang was preceded by a presidentially-appointed Commission. It came up with a $4 trillion Grand Bargain that fell short of the required majority.
Andy Laperriere with ISI Group says the two parties have very different views on the role of government.
Andy Laperriere: The bottom line is Democrats don't want to vote to reduce entitlement spending by a meaningful amount and Republicans don't want to vote to raise taxes by a meaningful amount. So its difficult to get either of them to get off that position.
This latest attempt has a Plan B: automatic, across the board cuts in spending for both defense and domestic programs start January 2013. Unless the next Congress and the next president decide to change them.
In Washington, I'm John Dimsdale for Marketplace.
Why is it that all media discussion about either the Eurozone or the Super committee is perennially stuck in “raise taxes” vs. “cut entitlement spending” mode, as our primary dilemma? (How to compromise on this issue? Hmmm. It is a problem.) Yes, the U.S. just went by the $15 trillion mark in national debt. Yes, European bond yields are on the rise and the ratings’ agencies are threatening countries everywhere with a downgrade. Yes, three European leaders have been replaced with conservatives and technocrats that promise to address the problem without caving in to any political pressure that might call for opposition to high finance. How about suggesting that public debt is not the primary problem? These discussions should not be based on how to resolve our governments’ public debt problems, but on how to curtail our global PRIVATE debt problems. There is no discussion about this at all, unless you happen to read books written by financial analysts like George Soros or Barry Ritholtz. It’s as though it goes without saying that our government and all governments should give unquestioned priority to the nearly $600 trillion global derivatives market that has wormed its way into home ownership, pension funds, and government securities. The latter is the only “program” we need to cut, and drastically, by isolating its vast pool of toxic garbage, requiring investors to take losses, and protecting ordinary people from the excesses of finance in the future.
Dear Marketplace:
If you ever tire of repeating economic dogma according to Grover Norquist, you may want to open your minds to consider that the austerity policies -- and pain for the "little people" -- that you champion so much are deeply failed and make no sense:
http://www.cnbc.com/id/45337674
"The austerity measures being rolled out in countries across Europe will have a devastating effect on the living standards of its population, an economist told CNBC Friday."
Instead you keep repeating calls from Wall Street for austerity aimed at the middle class, seniors, clean energy, the environment and the poor.
Where were you when these deficits were being driven up by massive tax cuts and two wars --- all financed by debt? The deficits were not a problem then but are now, why? Can you defend that?
Andy Laperriere did not bother to check the facts before coming on the show. Democrats have, to their discredit, offered cuts to Social Security, Medicare and much else as part of these talks. This is an actual fact that your radio show should correct. The Democratic base is actually ticked off at the Democrats for this.
No mention from Marketplace of the zealous protection of Bush tax cuts for the wealthy. Not a peep about the single biggest obstacle that SuperCommittee faced! I guess Marketplace does not understand how revenues can affect deficits.
http://www.politico.com/news/stories/1111/68055.html
Further, every time I hear this show you are promoting austerity measures as a cure for our economic woes. According to Marketplace, if only the public sector would follow the deep decline in demand shown by the private sector, then the economy will rebound. It's as if you live in an alternate universe where businesses no longer need customers!
Austerity policies are a massive failure. They are failing in Europe. See next link on how Britain is now borrowing MORE that they would have if they'd only followed tried and true Keynesian policies.
http://www.independent.co.uk/news/uk/home-news/pain-but-no-gain-6263358....
I am going to contact Wisconsin Public Radio and request they stop broadcasting this show. The economic policies you promote - cure the economy by cutting the deficit - are nonsense of the type promoted on Fox News. You allow no/few alternative points, even from actual economists (as opposed to Wall Street flacks).
