A strategic assessment of the recent budget skirmish
posted at 2:00 pm on April 10, 2011 by J.E. Dyer
Bruce McQuain and others have made good points about the outcome of the budget battle – which actually ended up being a maneuver game, with a little fire traded but no real battle in the end.
Here’s my take, for what it’s worth.
First, the outcome of the last 24 hours is most important for what it’s not: a full-frontal cave-in by Republicans to business as usual. The numbers are less significant than the political postures in this regard. In the end, the Democrats were prepared to offer more cuts rather than go to a shutdown.
That means they were not as confident as their earlier rhetoric suggested that a shutdown would produce a political result in their favor. I suspect the Wisconsin supreme court election had something to do with that.
The point that the cuts are small – smaller than the additions to the deficit over just the last week – is well taken. But anyone who thought the whole war was going to be won on this battle misperceived the event. It was never going to be. This was not the battlefield on which the multitrillion dollar deficit was going to be slain. Moreover, heaping efforts like defunding Planned Parenthood or the EPA on this particular confrontation was a flawed tactic. Riders of that kind are a perquisite of established political power relationships and procedural convention. When you don’t have that behind your effort – and the Republicans in Congress don’t – you need to fight only for what you must.
In the case of the punching bag that is the 2011 budget, avoiding a reversion to business as usual is the minimum the Congressional GOP had to achieve. It did that. There is an important sense in which this outcome has bought time: it almost certainly forestalls the decision of global finance planners to catastrophically disfavor the US economy and US securities.
That is a real possibility, if Republicans are decisively unable to halt the hurtling progress of our federal government toward fiscal insanity. The incremental success achieved by the GOP on Friday means that any assessment in that regard can – in fact should – be postponed. It’s an uneasy position for everyone, but it’s also better than any alternative. In terms of transparency, fairness, and public integrity, the United States and our fiscal management are still the best the world has got. Investment gurus love to maneuver against the dollar, but there is literally nothing that can do what it has done for the last 60 years.
That reality is based on the characteristics of American society and our political institutions, even more fundamentally than on our economy. Currency, fiscal accounting, and debt are all man-made constructs, not principles of the universe that operate, constant and indifferent, outside our conscious decisions. The mechanism that would render it impossible for us to manage our way out of our fiscal crisis is a loss of confidence in our character by the rest of the world. Other peoples stand to lose so much in their own right, if our character is judged to have imploded and our faith and credit to have become unreliable, that they are strongly motivated to postpone making that judgment.
The budget compromise on Friday gave them a reason to continue postponing it. There is another freighted confrontation coming up on 16 May, when money will run out if the debt ceiling is not raised. It’s important for Republicans to keep the trend going in the direction they’ve now established, however incremental the progress may be.
Trying to win the whole game on every play is a faulty approach, and one that has to be avoided. Republicans can force issues only in the House this year. It isn’t possible to override a presidential veto. Those are the constraints.
In a sense, the voting result in Wisconsin may turn out to have been the most important event of the last week. The Republicans in Washington avoided what would have been a very damaging – perhaps irreparable – loss, but the supreme court election in Wisconsin appears to be a positive victory (assuming Prosser’s win holds up).
America’s fiscal soundness can’t be repaired without a significant political shift away from the principles of progressivism and collectivism that have become entrenched at each level of government. We are attempting to turn the ship of state in a positive direction without descending into chaos or succumbing to weakness and corruption: an effort there are few if any historical models for. But there is no fate dictating that we can’t be the nation that achieves this. We have not even begun to tap the idled resources that can be brought to bear, to restore our character, our economy, and our fiscal integrity.
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