To Get Our Financial House In Order

Long Term Reform Instead Of “Kicking The Can”

Out of Washington, we tend to hear the same old stories.  Republicans want to cut spending and not raise taxes.  Democrats want to tax the rich and not let Republicans touch the entitlement programs.  Tea Party Republicans just want to defund the Affordable Care Act.  In a divided government, it has managed to get us into one stalemate after another.  This last time, it finally shut down the government and nearly brought us to the brink of defaulting on our debt.  Obviously, there are some common sense things that can be done to help move our government from the way it currently governs.  Instead of just “kicking the can” on each fiscal/economic crisis, it can easily put this together so we aren’t constantly facing the same problems.

The first thing our politicians must do is talk to each other especially people from the other side of the proverbial aisle.  This is a must.  We have a Republican-controlled House of Representatives and a Democratic-controlled Senate and President.  This means that everyone must work together.  It shouldn’t be about scoring political points or who’s right or “who’s winning.”  It’s about doing the work of the nation, and doing what the people need you to do.  Will there be times that we disagree on things?  Of course, but we can still be civil with our disagreements and work our way around them.  It all begins with respect and dialogue and knowing that neither side is going to get everything that it wants.  It’s called compromise, and it’s not a dirty word.  It is how this nation was founded.  The Constitution is one big compromise.  We should not lose sight of that fact.  We should respect it in our history and in the present.  Is it perfect?  No.  The Missouri Compromise and the Compromise of 1850 only delayed the start of the Civil War.  Compromising on the issue of slavery was just not going to work, but the effort was given.  When talking about our fiscal problems, compromise can work though much like the compromises that forged the very document upon which our government was formed.

new-congressSo now that we have the politicians talking to each other, what should they be talking about?  One word: budget.  The House of Representatives is correct in that it has passed a budget every year since Republicans took control in 2011.  The Senate has killed those budgets every time.  For the 2013-14 budget, the House stuck an amendment onto it that forced the Senate to pass a budget or not get paid.  Technically, that amendment would have been unconstitutional via the 27th Amendment.  However, it did get the Senate to pass a budget which the House then passed over.  Speaker of the House John Boehner (R-OH) then declared there would be no conference and the rest, we now know, is part of history.  Being controlled by different political parties, the two chambers are bound to come up with different budgets based on their party’s political views; however, they must remember the other side is controlled by the other party.  If all one side does is pass a budget that they know the other side won’t agree to then we aren’t getting anywhere.  Both chambers need to pass a budget that the other side will start working on with them.  This particularly goes to the House since all appropriation bills must start in that chamber via the US Constitution.

We are making progress.  Now they are talking to each other about the budget.  But now what is in that budget?  (Quick note: Some of these are just ideas and mentioning them does not mean ‘yes’ or ‘no.’)  The budget needs to start backing us away from the debt ceiling or it will need to be raised continuously and doesn’t solve the problem.  The debt ceiling must be raised each time because we have an obligation to pay for the things that Congress and the President spend money for.  But with the right budget, the nation can begin to back off the debt ceiling.  If Congress cannot work together to pass a budget through both chambers each year, then they should not be paid for that year as passing spending resolutions is one of their key tasks. (Note: This last part would only take effect after an election per the 27th Amendment.)

Let’s start with funding the various government departments.  The sequester cuts must remain in place though each department should be allowed where to make those cuts.  In addition, it wouldn’t hurt to at least take another 5% from each department.  There is plenty of waste in each department to do this. (click here)  With the new funding levels, departments will still lose money, misappropriate funds, or just waste it away.  When this becomes known, then that particular department would lose that specific amount of funding for the next budget year in order to repay the taxpayers and would lose any chance of an increase in their budget (minus returning to their previous level once that year is complete) for the next five years.  No department likes to lose money, so hopefully this will make them become more aware of how it is spent.  Automatic budget increases must be stopped.  Increases in funding should be determined by the economy, income, and how each department manages its current funding.  This would apply to all departments including defense (which could probably withstand an additional 10% cut instead of the 5% mentioned above).

tax-pressuresThe government is funded through various taxes… one of which is the income tax.  (Before income tax was made legal, the government was mainly funded from a sales tax on alcohol.)  Our tax code is a disjointed mess to say the least.  There needs to be tax reform both income and corporate.  This means that some will be paying less and some will be paying more.  In regards to income taxes, leave them at the levels they are currently with the exception of the top 1%.  As part of the sequester deal, the very, very top of the 1% saw an income tax increase but not the rest of the 1%.  Bring the rest of them into the fold.  Next are corporate taxes.  The US does have one of the highest rates in corporate taxes.  This should be brought down to a respectable level to make corporations headquartered here to be competitive internationally and also attract those foreign companies to locate jobs here.  Our politicians should also be open to finding new sources of revenue.  These sources could come in the form of legalizing medical marijuana and taxing it accordingly or leasing out certain federal lands  for renewable energy such as solar and wind.  Maybe they could sell of some of their property they are underutilizing, and maybe even sell some land back to the states.  There are plenty of ideas that can fit into this and should be independently explored openly.

Notice that I didn’t discuss individual departments.  That’s mostly because this would have gotten rather lengthy, even if there had only been a few examples.  This was a blueprint in order to get the two sides talking about some common sense ideas.  It’s not about political points or who’s winning.  It’s about doing their jobs and doing what the nation needs them to do.  We have to get our financial house in order; otherwise, we are going to continue to go around in the same circle that we have been for the past few years.  The latest government shutdown and nearly defaulting on our debt once again should teach us this lesson.  Our politicians need to wake up and take care of business.

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Who’s To Blame For the Government Shutdown?

It’s the beginning of October.  It’s the time of year where we should be discussing fall colors on the trees, the shorter days, college football, and for some of us, postseason baseball.  However, on this first day of October, we are all talking about the shutdown of the federal government as a result of Congress’ inability to work together to fund the government.

Both chambers of Congress, the House under the leadership of the Republicans and the Senate under the leadership of the Democrats, have been playing “chicken” with  each other to see who would blink first.  Sadly, neither side did in this instance.  It is the first shutdown since 1996.  As many times as we have gone to the brink in the last few years only to have a deal reached at the 11th hour, it was only a matter of time before we missed one and the government shut down.  We have all watched it time and time again to dismay, and yet the members of Congress still haven’t gotten the message that this is not a way to govern.

This past week has been the real ping-pong match.  Up until then, it was all being done fairly lazily until then.  Then bills started flying out of the House and the Senate would reject them.  The House was essentially passing bills that they knew the Senate (and the President) would not pass (or sign).  Regardless, they still did it anyway.  Their last attempt was late on Saturday.  House Speaker John Boehner (R-OH) then went to the floor and criticized the Senate for being out of session on Sunday and said that they should return in order to vote on the bill.  I must beg the Speaker’s pardon when I state that I don’t think he has much room to complain.  The Senate is in session 5-days a week.  The House has been in session 3-4 days a week.  After coming back from their month-long August recess, the House only had 9-working days to pass something.  (They did work over the weekend, so that number bumps up to 11-days.)  This was not an unforeseen situation.  He could have called the House back even earlier to work through this mess.

The Senate lost an entire day of debate and voting, and giving a bill back to the House a day sooner, by Sen. Ted Cruz’s (R-TX) filibuster over the Affordable Care Act in which at one point he started reading Dr. Seuss.  Talk about a waste of time and money.  I don’t argue with the talking filibuster.  That is the way a filibuster should be done.  So I do give him some props for that.  However, when you start reading Dr. Seuss and get off topic, then your filibuster is over and you should sit down.  You made your point, and the Senate needed to get back to work.  Speaker Boehner then attempts to organize a conference committee late on Monday night after the Senate again votes down a House bill which should have been no surprise.  This is something that should have been done after the first bill met with failure instead of at the last possible moment.  The Democrats won’t meet with them, which is a huge mistake.  Senate Majority Leader Harry Reid (D-NV) said he won’t meet with Republicans “with a gun to his head.”  Though that probably isn’t the best way to start a negotiation; however, it’s time to put these things aside and sit down together.

congressAs much as the two parties love pointing fingers at each other and attempting to place blame, it is both of their faults.  This is a made up scenario because of their inability to pass a budget.  That’s right.  Congress has completely made up this mess that we find ourselves in.  The House can tout that they passed a budget earlier this year and have every year.  The Senate passed a budget earlier this year for the first time in years after being forced to do so.  But that is where everything stopped.  The leadership was unwilling to meet in conference to work out the differences and to compromise on an actual budget that could pass both chambers.  If they had done so, then it is quite possible that today wouldn’t have been a big deal at all.  It’s called “doing your job” and most Americans do it every time they go into work and can’t figure out why members of Congress can’t seem to grasp it.  And Speaker Boehner likes to criticize the Senate for only voting on the House bills but offering none of their own.  I think he has forgotten that the Constitution states that appropriation bills must all start in the House.  Then the Senate can amend the bill and send it back or pass it.  The Senate leadership has stated that it wants a clean Continuing Resolution while the House wants a CR tied with the defunding (or delay) of the Affordable Care Act.  The ironic thing in this debate though is that even with the government shut down, the healthcare exchanges created by the Affordable Care Act opened for business.  But House Republicans still remain adamant about shutting it all down.

The people that are really hurt by all of this are the federal workers.  They are the ones that are out of work and out of money.  How does that help our struggling economy.  Meanwhile, members of Congress are still able to collect their paychecks though some, like Rep. Ann Wagner (R-MO) and Rep. Jared Polis (D-CO) among others, have refused their paychecks during this shutdown.  Congress should pass a bill now that would strip away all congressional salaries during any government shutdown.  Though it wouldn’t take effect until 2015 due to the 27th Amendment, it would still send a strong message to future members of Congress… get your stuff in order and do your job.  Members of Congress shouldn’t be paid if federal workers aren’t.  Rep. Jim Moran (D-VA) along with 30 House Democrats and 3 Virginia Republicans have proposed a bill that would allow full, retroactive pay to all federal workers that are furloughed as a result of the shutdown.  This should be a unanimous vote from both chambers as the people should not pay for Congress’ inability to do its job.

And where is the President in all of this… as many Congressional Republicans have been asking.  It’s quite simple.  He is trying to stay out of the fray as much as possible.  Remember, the President isn’t part of the Legislative Branch.  He is part of the Executive Branch.  The Constitution split these branches and their subsequent powers up for a reason.  In the 1996 shutdown, the difference was between Congress (both chambers under Republican control) and the President.  That was different.  This time, the difference is between the two chambers of Congress and does not involve the President until the bill reaches his desk.  If he vetoes it, then he becomes part of it, but until then, this is a strictly Legislative situation.

Who’s to blame for the government shut down?  Both parties in both chambers simply because they’d rather be in front of the cameras doing political grandstanding instead of talking to each other and passing the necessary legislation to keep our government going.  Enough of this posturing.  It’s time to sit down and get to work… something that should have already been done.  And don’t just kick the can down the road further.  Actually get this done by passing a full budget.  Do your job.  If you can’t even work together or be civil with each other, then there’s no reason for you to be even be there.  On January 1, 1812, John Adams wrote a letter to Thomas Jefferson.  It was the first letter that had been written between the two since 1801 (not including a brief set of letters between Abigail Adams and Thomas Jefferson in 1804).  Jefferson responded in kind upon receiving the letter from his old friend.  At the end of that letter he wrote, “No circumstances have lessened the interest I feel in these particulars respecting yourself; none have suspended for one moment my sincere esteem for you; and I now salute you with unchanged affections and respect.”  These were two men bound by friendship and separated by politics.  Somehow, through it all, they were able to maintain that friendship until their parting breaths.  Our current congressional leaders need to learn something from these two.  Respect and civility.  Now get to work.  The American people are watching and waiting for all of you to step up.

The New Mandate

After every election, we always manage to hear the winning side say that they have a mandate from the American people.  The people have spoken, and they want their plan over their opponent’s plan.  And there is no doubt that after the presidential election in November, whoever comes out on top will be declaring the same thing.  But is there really anything to it?  Can any side really claim a mandate just because they win the election?

A presidential election is a good place as any to start.  It’s a time when turnout is the highest though we’ve only been hovering between 50%-60% in voter turnout.  Can we honestly say that our elected officials know what the general populace wants when there is almost 50% of the voting population not voting at all?  We have them basing their decisions on only what half the people say.  So there is the first problem.  The second part of the equation is how we elect our president.  As stated in the previous entry (The Electoral College), we elect our highest office through the Electoral College.  It’s “winner take all” in 48 of the 50 states no matter what the margin of difference is.  We need to look back no further than 2000 and the election between George W. Bush and Al Gore. It was a time of economic prosperity, budget surpluses, and pre-9/11. There was nothing to indicate a close election, but it still was.  We make note that Bush won Florida by 537-votes.  People fail to remember that the vote difference in 12-states that year was less than 5%, according to the FEC.  In 2008, there were 6-states that had vote differences less than 5% (and the 2nd Nebraska district… since Nebraska is not “winner take all”) which totaled 88 electoral votes.  There were 9-states and Nebraska’s 1st district that were between 5%-10%.  Barack Obama won the Electoral Vote 365-173 with 52.92% of the total votes cast.  But that is only 52% of the 60% that actually voted.  So does that constitute a mandate when those that are eligible to vote and don’t could easily swing the election one way or the other?  A few votes here or there in 2000 in the right states could have swapped the election.  Same goes in 2004 and 2008.

In the US, we have a duopoly running our government.  The media and everything else focus solely on the Democratic and Republican parties despite there being several others.  So the pendulum only swings two ways.  It will stay Republican for awhile and then when the majority of voters tire of that side, they switch to the Democrats until they tire of that way and then the pendulum swings back.  And just because someone votes Democratic during one such election just might mean that they don’t like the Republican that’s running and vice versa.  In 2008, there were probably many voters who were tired of Republicans running the Executive Branch of the government… as they had been for the previous 8-years.  There were probably others who didn’t like either Senator John McCain or Governor Sarah Palin.  On the other side, there were probably people who voted for McCain that didn’t like Senator Barack Obama or Senator Joe Biden.  Now I go back to 2000 again.  We had been under Democratic leadership in the Executive Branch for 8-years with President Clinton.  Congress had been Republican for six of those years.  The people did state, by official numbers, that they wanted that branch of government to swing back to Republican control.  However, the total vote difference was just shy of 544,000-votes… or  0.51%.  And with Republicans still controlling Congress (with only the exception of the Senate being evenly split 50-50 from 2001-2003), they wanted to claim that the people had given them a mandate to do as they wish.

Now, our Founding Fathers did set up our government so that those that we elect could represent us and what we want from our government, but they never envisioned political parties or certain individuals being elected repeatedly as though its a career instead of a civic duty.  The reason why there are elections for the House of Representatives every 2-years is because that is the people’s chamber.  It was supposed to be the way that elected officials, including the President, could keep tabs on what the mood of the public was.  The Senate, being the upper chamber, was supposed to put more debate into issues to make sure that the people were thinking clearly and the representatives were doing their job.  Between President George Washington and President John Quincy Adams, presidents had only issued a veto 10-times total (John Adams, Thomas Jefferson, and John Quincy Adams didn’t issue even one).  They mostly deferred to the legislative branch to set policy because  that was where the pulse of the nation was.  That was how the people expressed what they wanted their government to do.  But if we were to do that, do we look at the House or the Senate or both.  In the past two years, we’ve had a divided legislative branch.  In 2008, Democrats had big majorities in both chambers.  Before 2008, it had been fairly evenly divided for the previous 8-years.  So maybe that means that the electorate is evenly divided, or maybe the pendulum is just stuck and not swinging back and forth as wildly as it once was.

A close election is more fun than a run-away.  It gets people all fired up and usually drives more people to the polls since they believe there is more at stake.  They believe that there vote could tip the scale one way or the other… well, at least in the battleground states.  States that are safely Democrat or safely Republican usually don’t have that problem.  There in lies another problem with our elections and determining mandates, only about a dozen states are considered toss-ups each election year.  2012 has even fewer.  So the majority of the election is focused on the voters in those states, and it basically comes down to whichever party gets more people to the polls to vote that particular year.

There has been a lot of gridlock over the past two-years.  That’s what happens with divided government.  And it’s not necessarily a bad thing except when it prohibits anything from being accomplished.  One side doesn’t want to make the other side look good even if they do agree.  That’s when gridlock becomes bad because no one wants to work together because both sides usually agree on the basic principles and don’t want to help the other side look good.  At least when they are on “moderate” opposing sides, they can usually work together to come up with a somewhat reasonable compromise that appeases both sides… and is usually better than the one-sided plan.  Democrats state they had a mandate in 2008 because they won big majorities in Congress and the presidency.  Republicans say they now have a mandate because they took back the House in 2010 and took several seats in the Senate.  Is either side right?  Not really.  The pendulum was just swinging back and forth as it always does.  Can it show what the people are thinking though?  Kind of.  It can give a possible indication on how the voting populace is thinking (not the total voting populace).  And the reason why it’s only a “possible indication” is because we can’t be 100% sure why someone votes the way they do.  It could be the issues of the day, it could be that they are tired of the one party being charge, or they might not like a particular candidate that is running.  In any case, our elected officials need to stop using the term “mandate” when they speak after election.  Especially in today’s times, there just is no such thing.  There are entirely too many variables which include the flaw of our duopoly in government and that almost half of the voting population aren’t actually voting at all.  It’s difficult to getting any kind of accurate census in that manner.

A Taxable Penalty

Is it a tax or is it not?  The Supreme Court has said yes and thus is constitutional.  In 2009, President Obama said that it wasn’t repeatedly.  Republicans said that it did not fall under the Commerce Clause for the Congress to pass such legislation, and therefore, wasn’t constitutional.  There have been so many different angles coming at us these past couple of days over the Affordable Care Act (“Obamacare”), that one’s head might start spinning in circles if it came to making sense of any of it.

President Obama did in fact say in 2009 on “This Week with George Stephanopoulis” on ABC that the Affordable Care Act wasn’t a tax.  Democrats in Congress even made the same point.  But that came down to semantics.  The word used throughout the legislation was ‘penalty,’ and it only applies to those that don’t have health insurance.  Knight professor of Constitutional Law and the First Amendment at Yale Law School, Jack M. Balkin, wrote the following in an op-ed for CNN:  “If the Affordable Care Act imposed a mandate, it was ordering people to buy insurance, and nobody likes to be told what to do by the government. But if it was a tax, then it actually gave people a choice: Pay a small tax, or buy health insurance.”  Republicans like to make the charge that the Affordable Care Act is government-run/socialist healthcare, and they’ve managed to stick to that message and get people worked up over it (hence how we now have the Tea-Party wing of the Republican Party).  Most First World nations (and others) actually have government-run/socialist healthcare, and one should go look those countries up before making such a claim here.  So here is my question to this.  How is the Affordable Care Act government-run/socialist healthcare when people still have the right to choose which healthcare provider and plan they wish to go with?  The government isn’t forcing us to buy healthcare from itself since there is no public option.  For those on Medicare and Medicaid, which are government run healthcare programs, this law doesn’t really concern them.  It also doesn’t affect those with company healthcare.  It mostly goes after those that buy healthcare on their own… whether they choose to or have to.  It does have far bigger reaches such as covering pre-existing conditions, covering dependents until they are 26, etc., etc.  (click here for more information)  If one were buying individual health insurance, they will now be able to enter into an exchange that will allow them to be like a company with bigger numbers for better prices rather than just being one person.  It’s often the lone individual that gets stuck with higher premiums.  The consumer still gets to choose which health insurance they wish to purchase or even choose not to and pay the penalty.

“The Congress shall have power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States; […]” Article I, Section 8 of the US Constitution

So now that it has been determined that the Affordable Care Act was essentially taxing people that didn’t have health insurance (despite the term ‘penalty’ being used), it now just needed to justified by providing for the general welfare.  In the end, five justices of the Supreme Court ruled that it did and therefore fell under the powers of Congress.  Again, I go back to the op-ed on CNN from Jack M. Balkin…

“The answer to that question was also pretty clear. Congress wanted to give all Americans a new set of consumer protection rules that prevented insurance companies from denying coverage for pre-existing conditions and imposing lifetime caps on coverage. The only way to make those reforms work, Congress thought, was to get more people in the national risk pool. Hence, Congress decided to give uninsured people a nudge instead of a direct order: It taxed them if they didn’t buy insurance.”

With the Supreme Court ruling, the Affordable Care Act is now the legal law of the land… despite where any of us stand on the issue.  The only way it can be repealed is by an act of Congress… which Republicans are trying to do.  Presumptive Republican presidential nominee Mitt Romney and other Republicans are saying that Affordable Care Act will add trillions to the deficit.  This has been rated as False by Politifact.  They went to the non-partisan Congressional Budget Office for their official numbers.  The CBO said that with the passage of the legislation, it would lower the deficit by $124 billion over 10-years, and that repealing it would increase the deficit by as much as $210-billion over 10-years.  The CBO isn’t perfect with it’s calculations.  It even admits that it’s hard to predict future numbers since there are many variables that can make them go up and down.  There is one additional stipulation.  These numbers were crunched before the Supreme Court ruling, which did make one decision that could affect them.  The court ruled that though the federal government could give the option for states to accept (or not) the new Medicaid funding, the federal federal government could not withhold all Medicaid to the states if they refused… that it could only withhold future payment increases, but not what was already agreed to when the federal government and the state governments entered into the Medicaid program.  The CBO is currently crunching the numbers to see how the ruling will affect the overall numbers.

The Democrats, and President Obama, celebrated the ruling on Thursday while Republicans fussed over it.  And though the moods were celebratory on the left, I’m quick to remember that nothing energizes the right more than “Obamacare.”  This November will be the endgame.  If the Republicans can’t win the presidency and both houses of Congress by big enough margins, then the Affordable Care Act will be here to stay.  Only time can tell if the legislation will go down as a triumph or a failure… no matter how November goes.  In the past, we’ve seen bad legislation be popular and good legislation be unpopular.  For now, the shock is wearing off, and voting populace is turning now to more pressing matters… jobs and the economy, despite Republican efforts to keep healthcare at the top.  It’s hard to say how this will play out in the years to come, but it will take an educated populace to get through all the partisan rhetoric.

“You can fool all the people some of the time and some of the people all the time, but you can’t fool all of the people all of the time.” Abraham Lincoln~

SIDENOTE:
According to a new Gallup poll, Americans are evenly divided as to whether they agree with the Supreme Court decision 46% to 46%.  Approximately 80% of Democrats agree compared to 45% of Independents and 13% of Republicans.

LINKS:
Washington Week (PBS) – Friday, June 29, 2012

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