President Obama signs Jobs bill in Washington, September 2010 (image from http://www.upi.com/News_Photos/view/a04518d5d790f227ff51e652009a4d65/Obama-signs-Jobs-bill-in-Washington/)
Earlier this month, President Obama approved a budget bill to keep the United States government solvent through the end of fiscal year 2011. After months of deliberation and disagreement, Congressional Democrats and Republicans finally agreed to a compromise, narrowly avoiding a government shutdown that would have put hundreds of thousands of federal employees on furlough. Despite the suspense surrounding the potential shutdown and the repeated calls for one from many congressional Republicans and Tea Party hardliners, lawmakers had no desire for things to go that far. New York Times columnist David Brooks even pointed to the possibility that a deal was long in the works and the parties simply waited until the last minute to sign, allowing them to tell their constituencies that they went to the wall on the issues.
Despite the theatrics and the fact that this most recent compromise is only a precursor to the larger battle looming on the horizon – the government will reach its limit to borrow money in mid May – there is more to what’s happening in Washington right now than meets the eye. Since the midterm elections in November, there has been a complete shift in the nation’s political discourse away from job creation and economic recovery towards fiscal responsibility and the national debt. This change is crucial not only in reference to the current budget debate, but also in relation to public opinion, and the nation’s nascent economic recovery.
In the wake of the 2008 financial crisis that left millions either unemployed or underemployed, public opinion focused largely on job creation. Barack Obama came to office on the wings of a campaign that promised renewed job growth and a restored sense of hope for the country. Now, two years later, the unemployment rate has seen some fluctuation, both up and down, but has largely stagnated, currently sitting at 9.2%. Polls as recent as February indicate that the American public still views jobs as the most pressing issue for the country. However, the majority of political rhetoric is currently geared towards the debt, with the Republican Party continually citing November’s elections as their party’s ‘mandate to take action on the deficit’. The message coming from the GOP is that a reduction in spending will allow for the creation of jobs while stabilizing our economy for future generations. At face value, this assertion sounds quite good; a smaller deficit would free up capital for investment that would have gone to service the debt previously; in turn consumer confidence would presumably go up and corporations would start hiring again. The downside in this instance is not so much the message, but the specific approach being employed to reach these goals, a method that can be described as nothing less than ‘slash and burn’.
Led by the self styled ‘deficit hawks’ and freshman Tea Party legislators, congress has proposed and passed a deluge of regressive legislation in its quest to reduce spending in Washington. However, this slash and burn approach doesn’t stop in Washington; countless state governments are pushing forward with their own plans to drastically reduce spending; for instance a current bill in the state of Pennsylvania would defund public education by more than $1 billion dollars with some of the poorest school districts being hit the hardest. At the same time, despite recent public opinion that favors raising taxes – particularly on the wealthy – to generate additional revenue, Republicans hold a position of intransigence concerning taxes, stating that they should never be raised. Ever.
Following the budget compromise for the remainder of fiscal year 2011, congressman Paul Ryan, chairman of the House Budget Committee, laid out his own plan for the 2012 budget. The bill seeks to turn Medicare and Medicaid into block grants. Vouchers would be issued for the purchase of insurance from private companies. Unfortunately, the budget doesn’t account for inflation or the rising cost of medical care, leaving senior citizens and poor families to cover the difference in cost out of their own pocket. At the same time the budget would reduce the tax rate for top earners in the country from 35% to 25%, essentially stating to the American public that necessary medical services aren’t affordable but the country can easily afford further concessions to millionaires and billionaires. Most alarmingly, despite continued public concern over jobs, the budget does not address the issue directly, assuming that job growth will accompany fiscal austerity.
In response to Ryan’s plan, President Obama laid out his own plan that seeks to balance the budget by increasing taxes, and decreasing defense spending while preserving Medicare and Medicaid. The President’s plan and Congressman Ryan’s plan are currently the two main budget options and the political discussion has pitted them against each other creating questions over a potential compromise.
There is however a third option. The Congressional Progressive Caucus recently released what they’re calling ‘The People’s Budget’ for fiscal year 2012. The budget seeks to reduce the deficit by 2021 largely by increasing taxes on the wealthy, ending corporate welfare – specifically for oil, gas and coal companies – ending the wars in Iraq and Afghanistan and enacting a public health care option that would serve to control skyrocketing healthcare costs. At the same time the budget lays out a plan to invest nearly $1.5 trillion in job creation, reflecting the continued concern over employment and the country’s dire need for a new approach to the issue. Despite its close alignment with public sentiment, the People’s Budget has gotten very little attention due to the pervasive power of a political discourse on an ideological warpath to reduce the size of Government. It is emblematic of the growing discord between the debate in Washington and views of the people.
Recognizing and understanding this discord is important if the Government hopes to move past the current deadlock and represent the views of the people as it’s meant to. Obama was right when he stated that the debate over the budget is about ‘more than numbers on a page, more than just cutting and spending, its about the kind of future we want.’ The American people have made it clear what kind of future they want; it’s time for legislation to start reflecting that.
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Author: Erik B Wilson
Erik is currently completing an MSc in Development Studies at the London School of Economics. His research considers issues of peace building and civil society with specific reference to Nepal. Before coming to the LSE Erik worked for several non-profit organizations after completing his BA in Anthropology at Skidmore College. In addition, Erik is a photographer and is working to combine this with his interest in development, his work can be seen here (link to www.erikbwilson.com).
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