Stumbling toward financial sanity?


Could it be that the numbing financial and economic crisis engendered by divided government in Washington is returning the country to an authentic budget process?

That piece of what may well be Pollyanna comes out of an examination of what has actually been going on, rather than the mainstream media’s hysterical indictment of the Tea Party.

When the House of Representatives, for whatever political motive on the part of the Republican majority there, sends specific appropriation and expenditure bills to the Democratic-controlled Senate, it is returning to its proper function. Senate Majority Leader Harry Reid’s hysterical – “What right have they [the Republican controlled House] to do that?’ –is incredibly Constitutionally ignorant. For that is precisely what the Constitution requires. The Origination Clause, also known as the Revenue Clause [Article One, Section 7: Bills Clause 1: Bills of revenue] reads: “All Bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills.” Obviously, The Founders recognizing the power of the purse string wanted it lodged in The House of the People with its almost immediate two-year reflection of popular will.

Subsequent law, dating back to the Budget Act of 1921, has set up a process by which the government’s expenditures are to be met through a series of executive and legislative requirements — estimates by the executive, their examination in House and Senate committees, appropriation and expenditure of a dozen bills by the 13 House committees, and approval through joint consultation between the two houses, and their implementation by the President and his executive departments.

For more than a decade that procedure virtually has collapsed for a vast variety of reasons. Fundamentally, there is the growing size and complexity of the federal government that now requires a fifth of the gross national product to fund it. There is the necessity for the President to get an estimated budget to the Congress on time and with a realistic expectation of its being the beginning of a establishing a consensus. There is the annual press other business as the Oct. 1st deadline approaches when the country’s fiscal year begins.

Instead of this procedure required by law, the President and the Congress over the last decade has taken to passing a “Continuing Resolution” [CR]. It is in effect a stopgap measure which regurgitates the appropriations and expenditures of the previous year as the new operating budget. “Anomalies”, that is, obvious differences which must be faced in the new year, are incorporated into the CR. [So much for current calls from the White House and the Senate Democrats for a “clean” CR to be passed out of the House and on to the Senate and the President; there has never been such an animal.]

This year’s fandango began with President Barack Obama submitting an estimated budget two months after the legal deadline, the fourth time in five years he has done that, and a worse record than any president dating back to the requirement “set in stone” almost a century ago. But neither the Republican House nor the Democratic Senate treated the President’s estimates seriously. But a proper House budget carefully crafted under Budget Committee Paul Ryan, recognized on both sides of the aisle as the most knowledgeable fiscal authority in the Congress, was dead on arrival in the Senate.

Feeding into this impasse is the problem of the growing federal debt – now at nearly $17 trillion or nearly the total of the whole gross national product, the sum of all economic activity in the country. With authority to borrow bumping up against the Congressional limit repeated reset on borrowing, House Republicans are trying to use their leverage [a general public outcry against the towering figure]. From their point of view,  that would appear to be the only way to meet current obligations but at the same time to put a brake on increase in government spending.

In fact, there is little hope for more than a bandaid. Unless the already existing three largest government expenditures with their “automatic” increases, Social Security, Medicare and Medicaid, can be reformed and curbed, the borrowing limit will go a glimmering.

Enter the President’s Obamacare, which despite promises it would over the long run reduce the nation’s medical expenses, critics now calculate, among other things, it is going to increase federal spending by 15% in only a decade.

That, in addition to whatever their political gain from opposing a measure which is generally considered unpopular, is why the House Republicans are fixated on Obamacare. Consecutively, they have tried to engage the President and the Democrats in some kind of “fix” – either repeal of what was a so-called comprehensive rearrangement of a sixth of the economy, refusing to fund it, or calling a halt to its implementation in the whole or in its parts. Ironically, this last option is something of a pale imitation of the President’s own – if perhaps illegal – series of waivers and extensions by executive decree offered to some but not all participants in the law’s implementation.

That is why the country has seen the spectacle of repeated attempts by the House majority to pass specific pieces of legislation to the Senate, where they have been summarily rejected. In most instances, the Senate majority simply refused to even have them debated. However, the House Republicans – besides supposedly according to the polls taken the hit from the public for the partial shutdown of government – in the process has willy-nilly returned to the budget process. Repeatedly, now, they have sent measures forward which the Senate Democratic majority leadership [and even some Democratic Senators who may face reelection problems] has had to endorse and send to the President for his signature because they were just too popular. Several of these have involved the military.

Unfortunately, time is running out. The timing of an actual default – that is, the inability of the government to pay its bills – has probably been exaggerated by the Administration, its Democratic Party spokesmen, and the liberal media. With record tax receipts, it would at least be theoretically possible for the Treasury to prioritize its outlays, giving the highest priority to payment of interest on the debt, and still be able to keep the government going for some time. Contrary, again to media exaggerations, more than 80% of government activity is continuing in this current partial “shutdown”. More could probably continue were it not clear that the Administration is creating as much pain and suffering as it can in order to heap more abuse and blame on the Republican House. But it has been a backlash on some of these Administration’s actions – for example, closing an outdoor memorial to World War II veterans – which has profited the House Republicans. It has permitted them to take up what the Democrats call “piecemeal” appropriation and expenditure legislation, and to the dismay of the Senate Democrats, sometimes getting them through the Senate and on to the President’s desk.

“Piecemeal” is not an approbation that would stick. Among the reforms obviously needed in the budget process, is one that requires the House [followed by the Senate’s collaboration] to return to just that kind of process. It would be the examination of the requirements of the individual units of government to be met with judicious and considered funding.

In one of those many accidents that determine history, it just may be that the House Republicans have stumbled on to a strategy. If so, Pres. Obama’s attempt at “transformation” of American society is dead and will soon be buried with its headstone reading “Obamacare”.

sws-10-12-13

 

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s