Sunday, July 31, 2011

Avoiding Damage to the Biggest Economy on Earth: the belated compromise and the shaky future?

Keywords or Terms: Debt Ceiling; Interest Rates; Recession; Unemployment; Failing economy; Failed amendment to constitution; CBS; NBC; ABC;  PPACA; Senator Kennedy; President Obama; Washington DC; Balanced Budget Amendments 

There are several issues that may propel disaster for American economy due to the fall-out of inaction to raise the debt ceiling by congress: rising interest rates and slowest of all economic recovery of all time. The recession is not only bad; it is by any measure, the worst this nation has known. The nation probably had reached a point, where we can barely afford the interest payments on our debts. Had we failed to reach a consensus or agreement on raising the debt ceiling by the deadline, the survival of many sectors of the economy would have been in question; even the best of the best economists and policymakers would have wondered, why we inflicted the harm on ourselves in the first place. The dance around the potential doom by many lawmakers in congress, reminded many of us of two kids at the play ground sticking needles into each other’s eyes. You want to ask them to quit, but you draw back knowing you are not their parents. You doubly wonder, didn’t each of their parents once warned them, if you keep on doing what you are doing, you’ll soon go blind? If you play with fire, you’ll surely get burnt!

Now going by all the Sunday morning talk shows on CBS, ABC and NBC, I came out with an important assurance that these lawmakers are probably getting it, there is no winner in a disaster like the one that is about to deluge the country. Forget about the politics of the past three weeks on the subject of raising the debt ceiling, who of us is willing to pay a higher interest rate for his or her credit cards; or, who of the millions of Americans with adjustable mortgage interest rates, is willing to pony up more money to the banks, finance and insurance companies? You probably heard the President could invoke the fourteenth amendment if the worse came to the worst; however, the repercussion of that action could lead to a consequential problem for the Presidency: Impeachment!

Now, lets throw the dice, if we had failed to handle this hot issue, it would not only have propelled the country’s economy into a new low, it would have widen the gap between the rich and the poor; and, that middle class that has been shrinking since the beginning of the recession, will get an additional hit probably up to a tipping point that could have led to a class war. Here are some terrible symptoms of the failure to act: 1) how about the worst job market in recent memory with youth unemployment in the range of 15 and 25%, families would not only feel more pains, the possibility of a soup kitchen expanding into semi-affluent neighborhoods, may turn to be a new reality; 2) how about shattered dreams and broken promises for the elderly on fixed income? and 3) how about many chapter eleven and probably seven bankruptcy filings and more walk always from mortgage loans? These are issues and questions that will impact Americans; they may actually set a new imbalance for the world’s biggest economy. No congressmen or women would have been exempted from the nation’s anger and when push comes to shove, a new class of congress would have been voted in anew, if that does not eventually take place with the current experience.

One early key to overcoming resistance from some lawmakers is a fundamental conviction in compromise and avowed belief that our lawmakers understand what are at stakes and would rather not have to deal with them. We have had long debates over bills and public issues in the past and often reached a compromise early enough to meet our deadlines, even when such compromises had been lukewarm. Unfortunately, it is the rarity of the current episode on disagreements between political parties and among our lawmakers that have worried the market and many of us watching the theater in both chambers of congress. After all the effort put up by leadership in both political parties, including the President of the United States, a compromise had basically remained elusive until today. The President came out with announcements at about noontime that an agreement had been reached and the final arrangement to ensure that the nation does not default is probably more of a reality. In simple words: The government of the United States of America will raise its debt ceiling and a super congressional committee that has the responsibility to tidy up some minor differences before the month of November will be inaugurated, empowered and set in motion to settle whatever differences are outstanding and to ensure that the nation does not get into another limbo on the issues of budgeting and raising the debt ceiling before 2012 general elections

One all the difficulties that the negotiation process had suffered are the painful perception or assessment that the Tea Party faction of the Republican Party had held the negotiation process in congress to ransom. It may be an incorrect perception or assessment; however, there are issues which made it seem like a group of lawmakers had pushed the negotiation process in congress to the brink. Especially on a bill that is expected to raise the nation’s debt ceiling and prevent a default. The power of compromise and reconciliation is often superior to confrontation and extreme recalcitrance. Using negotiations to achieve results in provisions expected in a bill is an understood practice that has been tried and tested over two decades. The process of these negotiations do not have to be strife or confrontational to an extent that the issue of civility is once again called into question among our lawmakers. Whether we are experiencing a new dynamics in congress because of the pressure group’s demand within the Republican Party or because of rejection of extreme demands on revenue raising or a balanced budget amendment to the constitution, one thing is very certain, the process of negotiations has gone too far and the acrimony among our lawmakers has not been helpful to the legislative process nor restoring of confidence in the people regarding how our lawmakers take issues that affect virtually all of us and our finances, very seriously.

Who can fail to understand that the longer the negotiation on raising the debt ceiling went, the jitterier the stock exchanges, here and around the globe, will become. Financial houses, banks, insurance companies, creditors and debtors, all across the globe were wondering, if the biggest world economy is about to default or actually defaults, what this singular irresponsibility will mean for the global market place. Remember the anxiety that accompanied the process of passing the Patient Protection and Affordable Care Act among democrats in Senate, after Massachusetts voters, elected Scot Brown to replace Senior Democratic Senator Ted Kennedy, who had left office due to the act of nature. The recent pandemonium regarding whether our congressmen and women were going to reach accord in passing a bill that will prevent the nation from defaulting on her financial obligations, was synonymous with the anxiety and events of those days. How about the excruciating pains of negotiations, rejections of bills in both chambers of congress, press conferences that turned out to be more of grandstanding rather than substance in the past week; all these compounded the whole mess and made many in the country wonder, if our law makers are meaningful or cautious of the implications of their impending inaction before the August 2nd deadline.

All of the challenges and anxieties now make some perfect sense, after hearing from the White-house what the tentative agreement is and what is more likely to happen so that the nation does not default on her financial obligations. The stakes were essentially too high and any effort to underplay the risks of indecision; or any ploy to continue to hold the nation to ransom, would have been tantamount to a disgrace and ineptitude on the part of our congressmen and women had the announced agreement failed to materialize as pronounced by the President. But, what is most surprising of all the hullabaloos surrounding the passing of a bill that will prevent the nation from defaulting was the fact that some lawmakers objected to a balanced approach in dealing with the nation’s deficit. In reality, many observers had not linked raising of the debt ceiling with establishing a constitutional amendment of balancing the budget. The latter’s demand from the Tea Party faction is hardly new; and, had once been considered under a Republican majority congress that failed; it is therefore whimsical to assume that now, when the Republican have to share the houses of congress with Democrats and the White House, they still expected to force through this amendment that will require the two-thirds of congress to pass; a very long shut if you asked seasoned lawmakers and close watchers of American congress.

Understanding the difficulty of passing an amendment to the constitution on any issue, not even one on finance, should have informed many lawmakers to understand that this is a very huge challenge and no matter how well intentioned the Tea Party group in the Republican Party is, it is probably unlikely that this form of amendment will pass under the current congressional arrangement. They need to understand and be understood in moving bills across congress is a sin qua non for any new lawmaker to congress. The neophytes in congress, who had campaigned that they were going to change Washington DC, have definitely underestimated the existence of negotiations, willing and dealing, that surrounds the task of passing laws in the United States Congress. The experienced Republican lawmakers must educates their green hands that they must first understand what it takes to pass simple laws not to talk of a constitutional amendment to afford for a balanced budget all the time. 

The lawmaking process is arduous and the issue of balanced budget while laudable does not take priority over many other more pressing issues. How about a constitutional amendment to ensure that women have control over their bodies; or, rights to abortion; or better still, how about a constitutional amendment to guarantee that all Americans who want a job, get one? These are the type of issues or questions that are synonymous with the demand for a constitutional amendment for a balanced federal budget, emanating from the fringe group in the Republican Party. If congress accedes to the demand or request for a constitutional amendment for a balanced federal budget, what would be next: a constitutional amendment to allow big banks or automobile manufacturers to be bailed out, when they under-perform? This is why this demand of the Tea Party members are ludicrous; and why many people are considering this demand as being out of torch with the reality of federal governance. There must remain the opportunity for the federal government to borrow to meet infrastructure development and national security, like building roads, airports, dams, bridges and military reparations from foreign wars if we are to have a viable and growing economy. Taking that opportunity away from the federal government under the disguise of fiscal responsibility as advocated by Tea Party members, is tantamount to governance irresponsibility. State governments may be similar to federal government; however, their capacity to function are dissimilar and to go on advocating that thirty or more states have constitutional amendments to balance their budget, and so the federal government must have a similar provision, is showing ignorance of what federalism entails.

If the culture of congress is to accede to every demand from a group of lawmakers, without exclusion, the hill will turn out to be a lame organization populated by Yes men and women, who hardly have a mind of their own. If congress is unlikely to take out extreme groups among themselves, perhaps we would not be able to integrate some laws with important and meaningful bills that will correct for past mistakes or some oversight in existing laws. Changes can easily be made to a weak or an ineffective law; however, this hardly rises to the level of constitutional amendment as the issue before congress today is to arrange to meet its past and probably current financial obligations; and, to set a less robust budget that meets current requirements of austerity and to still meet federal obligations to its people in growing the economy without undermining the lives of the least privileged among us.

The unifying principle of lawmaking is an understanding that the passing of bills requires some give and take from everyone from both parties. When lawmakers advance the incredulous, the possibility of their loosing credibility rises up a notch. The uniqueness of the request for a balanced budget amendment to the constitution from the Tea Party faction of the Republican Party, rises up to the level of incredulity; and this is why Democrats, especially those who are experienced in lawmaking turned the whole idea down, even before reading the whole text of the bill passed in the House on Friday. To achieve the demand of the Tea Party faction of the Republicans Party for a balanced budget amendment requires innovation. Without such innovation, it is rather likely that the issue of ethics will arise and very unlikely that two-thirds of congress will go along with the demand. To obtain the consent and support of the required two-thirds, some nimble time and effort must be expended and not with an acrimonious bill that already has its own other issues

Thursday, July 28, 2011

Default Vs. Non-default: From negotiated disagreements to cheap press conferences driven by ego from both aisle of congress, to a complete grounding of the ball?

Keywords or Terms: Economic Armageddon; Political Ideologues; Die-hard conservatives or liberals; Speaker of the House; Tea Party Lawmakers; August 2nd Deadline; Unemployment; Purists, Proposition 13; Tax revolt; Failure to reach agreement 

Every lawmaker, even the most astute die-hard conservative or liberal, does not want the good old USA to default on its financial obligations and debts. In pursuit of ideological line however, lawmakers have shown preference for bill(s) coming to the floor of congress, bill(s) supposedly designed to help the country avoid default by raising the debt ceiling, with potential disparate time frame of extension, consequences or results; all of which could be interpreted in different ways regarding their implications for the nation’s ability to survive Economic Armageddon. Hardly any of the bills in consideration today is probably going to satisfy everyone in congress, no matter their political affiliation or ideological leaning. The Speaker of the House couldn’t even guarantee that he can get every member of his party on board, with a call and recall of possible voting on the preferred house bill. And while it seems possible that the foremost house bill that is being considered for voting may receive a thin hair support; that is if the Tea party lawmakers will accede to compromise, it is probably unlikely that a positive vote on the bill will amount to the silver bullet for addressing the current stalemate and cloud surrounding congress.

The Democratic majority in senate have indicated that that bill is dead on arrival. It is hardly a perfect time to advance a bill passed in the House to Senate, if the domineering representatives in Senate have promised not to move it along or kill it. And, you’ll be fooling yourself, if you believe that the Whitehouse will not veto the bill as packaged by Speaker Boehner; even if passed through senate. Congressional lawmakers have led the fight over the debt ceiling to get to the wires and it seems the August 2nd deadline is hardly attainable. From the stellar position of the Republican majority in the House with the ability to do whatever catches their fancy to wobbly statements from the Speaker of the House, casting doubts on the possibility to make a difference in this long and difficult fight over raising the debate ceiling, congressional extremists have moved congressional leaders from crafting bills that could ameliorate unemployment to a group of lawmakers hardly able to convince themselves about the right thing to do in the interest of the nation.

How did we come to this cross-road? How did we allow the extremists in our congress to hijack the democratic process? To answer these questions, we must go back to some recent events in the annals of congressional calendar and political elections. Many voters in the 2010 congressional elections chose to send ideologues to congress, men and women, who do not understand the concept of compromise. Many of these new lawmakers were seeking to make a name, not necessarily building the democracy, an assertion each will vehemently or readily dismiss. However, the truth is these groups of lawmakers, many of whom will like the accolade of being called tea party members, are now cog in the wheel of progress. If you are mystified about what is going on in congress, then you must ask yourself, why I sent a person who hardly understands what it takes to govern to congress in the last election.

The United States Congress today is filled with ideologues, many holding seriously to their purported values and hardly appreciating the essence of compromise or the history of this country; and, why many of the greatest progress of this democracy have only been achieved through compromise. Yes, compromise not recalcitrance! From the triumph of the Civil War to enactment of Civil Rights Laws for minorities; from the tense political battles of the 1970s and 1980s to the election of the first African American President in the history of the union. Short of suspicion about the intensions of lawmakers who subscribe to no-compromise, one is tempted to believe that the hold out by these people will only foment more trouble for the law making process in congress as time goes on. In addition, the gradual escalation of refusal to play ball will probably amount to anarchy in American Congress with Tea Party members in driver’s seat.

Tea party is equal to tax revolt groups, all their membership are not necessarily recalcitrant, but ideologues with strings to pull and a devious objective to accomplish. Their ability to galvanize power within the Republican Party is not only notable, but is now giving the jitters to the republican leadership. Further, the current wave of tax revolt which had its foundation in California’s preposition 13 of 1978, which the Republicans have been riding ever since to dominate America’s democracy or challenge the Democrats dominance of the past century, is finally or about to explode in the face of the nation, as the tax revolt groups metamorphosing into the Tea party faction of the Republican Party are realizing their voice or power; and, are flexing their muscles to derail all that is good about America’s Democracy.

Could the Tea Party members subsume the moderates or centrists republicans? Could Democrats experience similar challenges from the extremists among them? No one can answer these questions affirmatively for the coming decade. For now, here are some relative challenges that are debarring congress from doing its work: 1) The catalytic impact of 2008 general elections is now being felt in the 112th Congress, with newly elected Tea Party faction of the Republican Party creating a lot of hassle for the party’s leadership, including holding out on reaching a compromise on raising the debt ceiling; 2) Most of the difficulties experienced in passing the health care reform law of 2010, came from ideological fights, nursed and perpetrated by the extremists in the Republican Party; and, 3) Less dramatic and tenacious stance of the Republican leadership are emboldening the insurgence of the extremists in that party; and, probably spilling over to the law making process or status quo in congress. All these and many more are probably why most of the nation are exasperated about what is going in congress, from self-inflicted wound of the failure to raise the debt ceiling, to the cantankerous attitudes of many of our lawmakers, especially those in the Republican Party.

As recent as last week Friday, ideological purists among republicans, who are attempting to take over the republican party, prevented the party leaders from reaching accord with Democrats, even on little things as signing-off on negotiated agreements. The Speaker of the House was made to walk away from negotiated agreements with the Whitehouse. In a cloak of holier-than-thou, the extremist republicans are articulating the position of leadership in the Republican Party and are gradually moving up on the food chain, ready or already challenging the leadership of the party. How about a hold out that prevented Speaker of the House to return the phone call from the leader of the free world? How about call out for some ultra-extremists that were members of the initial negotiation group with the Democrats? The attack on congressional leadership agreements from the tea party lawmakers, have made it difficult to reach any meaningful agreement in congress and is probably playing to the wishes of some ultra-conservatives in congress who could hardly stand the fact that Barack Obama is the President of the United States.

Further, last week, the republican leadership launched a public relation press bonanza to garner support for the foremost house bill for raising the debt ceiling; one that enough republicans can vote for; or, to put pressure on their undecided members to come around to the leadership’s position. Most recently, this week, each party leadership further launched press conferences to highlight the pit-falls in the bills swirling around the two chambers of congress; and, to ask for support for a bill that enough lawmakers can support and which the President can sign into law. The grandstanding, particularly from the Speaker of the House of Representative, gave one the impression that the republican leadership have put its house in order and there was going to be some truce regarding the two echoes coming from the republican congressional members: One from republican leaders who understand why it is essential to raise the debt ceiling; and, other from the extremists who believe that they are right and the rest of the country is wrong.

And while it may seem too early to postulate that the Republican leadership in congress is in a flux or totally in trouble with their Tea Party membership, the challenge ahead seems to indicate that the reality of political give-and-take is not floating among the republican lawmakers in the 112th Congress. Further, while it may seem too early to form the conclusion that Tea Party members of the Republican Party are out of whack with reality, it is safe to assume that as their membership gains ground in the party, the Republican party may end up becoming a neo-fascist organization, always willing to pull down anything that is good in governance. Without some miracles happening and with tea party membership gaining more clouts, it is obvious that the citizens will remain exasperated by the demands of this fringe groups on governance and leadership both in congress as well as in the country as a whole. Today’s absence of notable agreement on the foremost bill put forward by the Republican leadership in congress indicates that all is not well within the party. The absences of notable collaborations among republican lawmakers on raising the debt ceiling is making everyone wonder: Is the Republican Party going to the dogs?

Sunday, July 17, 2011

Getting answer to whether the nation is about to get into default: when a deal is failing at the negotiation stage?

Keywords or Terms: Economic Armageddon; Budget and Debt Ceiling; Retirement Plans; Foreign Governments; McConnell’s Plan; Short-term plan; Mid-term plan; Financial and Fiscal Arrangements; Patients Protection and Affordable Care Act

The United States President has done his job by bringing together the leadership of the two major political parties on the road of averting Economic Armageddon. The onus is now on the leadership to engage in progressive and forthright negotiations to avert the nation from going into default. If Congress fails to bring the components of the budget and debt ceiling debate together this week, then all bets are off on the August 2nd deadline; except miracles take place. The nation will be unable to meet her financial obligations to our creditors, including State, County, Cities retirement plans, federal employees retirement plans, Veterans retirement plans,  U.S. seniors, foreign governments; all of whom hold our notes.

U.S. Congress wants us to engage in debates over how much is real value, to muster support among our representatives to avert a disaster. Lawmakers are in tense negotiations which are looking more like race against the clock. But when Republicans are more interested in a bill that will lead us to a balanced budget through constitutional gymnastics, while leaving out genuine negotiations that could help avert Economic Armageddon, you start to wonder, what's next? By this singular action, you doubly wonder, where are the real wise men and women in America Congress? The contemplated and somehow preferred option of, kick the can down the road and constitutional gymnastics offered by some Republican leadership, are not only going to fail because we could not guarantee enough fellowship in both chambers of congress; and, even if we do, the President has indicated a preference for getting the job done, once and for all, rather than the piece meal that the contemplated option(s) entail. He will more likely veto both when they come to his desk and we will be back to square one.

The alternative plans offered to avert gridlock, if all fail with the negotiations on raising the debt ceiling, are giving all of us food for thought. The three known potential plans or options are the: 1) McConnell Plan; 2) Short-term plan; and, 3) Mid-term plan. The well spelt plan offered by Senator McConnell seems very plausible, but rather fearsome. The unfortunate issue regarding the McConnell Plan is that it requires no spending cuts or change to fiscal policies. Further, the plan proposes that the President requests a specific increase on the ability to borrow and a budget cut in an amount greater than the debt ceiling increase. This convoluted budget gymnastics anticipates that it will hardly achieve a two-third support from congress; hence, a default to allow the President to go ahead with his proposal and take the fall for it, come next year’s national elections. The fright from this plan is that it puts everyone on pins and needles and sets a stage for an indeterminable battle for the future.

For many of us, the McConnell’s plan is the height of hypocrisy; and, to imagine that congressional leadership may be contemplating this devious plan smack of genuineness to make the system work. There are reasons for congress debating budget line items and providing workable solutions after negotiations; however, there are no plans, defensible in terms of constitutional separation of powers, as anticipated in McConnell’s Plan, that is worthy of acceptance under the negotiated arrangement or non-negotiation arrangements put forth. This is a plan that says the nation’s lawmakers are unable to take responsibility for very difficult issues facing us. It is a plan with some suspicious possibility of imploding in the face of all involved and one that makes a mockery of United States’ Constitution; with the possibility of setting a terrible precedence for future congresses.

Interestingly, to further imagine that this plan came from Republican lawmakers who once rationalized that we can borrow money to fight two foreign wars; and now, are unable to find answer to the question of deficits from these wars, make many of us uncomfortable or quiver. Lawmakers who were all ‘gong-ho’ to fight wars at one million dollars a second are now unable to fashion out a budget cut to make up for deficits; and, are completely unable to figure out taxation that can recoup over 4 trillion dollars to help us stay abreast of our bills? We are in dire straights, yet we are not attempting to fight the economic problems, we are more interested in fighting political turfs and preparing for future elections. We are refusing to cut more of our defense spending; we are refusing to increase revenue by adjusting the tax code because it may fall on our rich neighbors; We care antagonizing laws and associated bills to the Patients Protection and Affordable Care Act, a law designed to help us cut the costs that have been claimed to be adding to our deficits; yet, we want to take a knife to the meager social security checks to our seniors? What is going on here; or, should it be: what a way to go?

Historically, we have often lifted the debt ceiling to allow government borrow on grounds of our good credit worthiness. We have written-off debts of other nations and guaranteed other nations to borrow from us and many international monetary agencies; yet, we are failing to weigh all constitutionally permissible options to deal with our budget deficits and lift our borrowing ability. We are failing to raise the debt ceiling to avert complete meltdown, but are willing or proposing to scuttle the provisions of our constitution. We are allowing political elections to determine fiscal responsibility and or, what is financially possible for our nation. We are attempting to kick the can down the road, with the mid-term alternative plan to the McConnell’s plan. The principle that we should be governing our affairs and affairs of the state based on good faith effort and transparency of purpose, is now being thrown away.These are rather mystifying at a time when our unemployment is going through the roof!

The whole world is watching, our credit worthiness is now at stake, yet we are playing with fire; one that can burn us real bad. We must appreciate that to a great extent, credit or the ability to obtain credit drives our economy; and, our GDP's growth is not going to improve unless employment improves appreciably. For us to have a substantial difference in growth of our economy and bring more jobs to our people, we must be willing to do the right thing; including lifting the debt ceiling and arranging for alternative solutions to our insatiable diet to expand federal spending. We cannot return the economy to a substantial growth rate, if we are unwilling to improve employment through constructive fiscal management and cautious effort at meeting our immediate, intermediate and long term obligations. We cannot return the economy to growth, if we are refusing to work together at addressing nagging issues that have been around for a long time.

The issue of raising the debt ceiling is neither a Republican nor Democrat’s one. It is a national issue that requires, or probably demands, a constructive working together of lawmakers from both parties. We must confront the real truth that financial or fiscal default is not an option; and, we can do more by identifying those real things that will make us go over the constant threshold of fighting and infighting among ourselves. As somewhat appealing, the notion of a balanced budget amendment, it is hardly going to pass in senate with Democrats. Further, since unimaginable emergencies do happen that make the government spend money to save life and property, it maybe necessary to give the government some slacks, rather than cornering it, where its hands are  tied and are unable to help in those times of challenges. To many of us, the balanced budget amendment caviar is more of a mirage in our type of economy and government. Not that we cannot not write and insist on a balanced budget amendment, but for an economy of our size, that proposal will just put us at the mercy of our creditors, thereby setting the possibility of our economic growth and expansion backwards. Yes, both republicans and democrats are guilty of spending beyond budget provisions; however, chasing after a balanced budget amendment does not solve the immediate issue of raising the debt ceiling. Neither will regurgitate ideological position on the part of each political party, position our country to do greater things in the future. With a financial and or fiscal default, we will even be worse-off at addressing issues that have left our whole economy in a recession.

Friday, July 15, 2011

Setting higher expectations on raising the debt ceiling and balancing the budget without raising federal revenue: how insightful?

Keywords or Terms: Whitehouse; Debt Ceiling; Social Programs; AARP; GE; Exxon; News Corps; ideological position; Hope; Optimism; Republicans; Democrats

If the negotiations at the White House this week regarding lifting the debt ceiling taught us anything, it is that republicans are insatiable; that even if Democrats are willing to give away the hugest proportions of Social Security, Medicare and Medicaid spending, Republicans will still insist that it is their way or the highway. What would it take to bring the Republicans around to the realities of not lifting the debt ceiling? Would setting the lowest bar for taxation even persuade the republicans that we have to raise some government revenue to meet part of our current obligations? Would the possibility of a government default spiting the nation’s ability to secure favorable terms on future loans convince republicans of what would happen if the nation’s debt ceiling is not raised by August 2nd? Would it be the AARP advertisement that their members should not be thrown under the bus in order for lawmakers to balance the federal budget or raise the debt ceiling?

Would the obvious consequence of humongous debts from two foreign wars and giving tax brakes to the rich in the past decade convince the republicans that you may not eat your cake and have it? Would Republicans appreciate that part of the reasons why we are asking them to support the raising of the debt ceiling and subscribe to additional revenue for the nation’s coffers come out of programs initiated and voted for by republicans in the past congressional sessions? Do republicans understand that when big corporations like GE, Exxon and News Corps pay no taxes, but instead receive tax returns to the tune of billions, that money is not available to pay down our debts or that that type of money must come from somewhere? Do we need to educate republicans about what a noticeable reversal it has been for a Democratic President to agree to cut some aspects of social programs that directly impact over 22 million seniors while attempting to get his party and republicans to a common ground for acceptance to raise the debt ceiling? Can republicans appreciate that part of our current budget deficit, came out of our inability to agree on what programs are actually essential for good governance and which ones are actually waste of money, even if they have to do with defense spending and or corporate welfare? 

Would demarcating the costs of the two foreign wars initiated by a Republican President and overwhelming supported by Republican lawmakers encourage republicans to assuage their demands? Republicans, who have made tax cut for the rich among us, millionaires and billionaires, a staple of their budgeting negotiations and practices, would like us to believe that continuing tax brakes for the rich, in austerity period, would help us cut down on our deficits. Would republicans talk to states’ governors about how bad the revenue forecast or receipts has been in the past three years and how things may get worse before they get better? If we, republicans and democrats, continue to haggle over how much cut is necessary in social programs and how much revenue we need to recoup from the rich, based on ideological grounds, then we are missing something in the whole puzzle of getting our economy moving again. If we are to get our economy back on line and create better opportunities to put the more than fifteen million Americans out of work, back to work, we have to be more forthright and transparent in our reasonings and negotiations.

Following tumultuous budget negotiations and debates under Vice-President Joe Biden, republican lawmakers in the budget work group, walked out on the group without any firm agreement on how to proceed. With deliberate rabble razing, republicans insisted that democrats were unserious about raising the debt ceiling or working on budget cuts. With each republican lawmaker walking away from preliminary negotiations and subsequently engaging in inflammatory statements about why the President is not doing anything about the impasses and why it was necessary for the President to step into the foray for there to be an agreement, the republicans have still not yielded on their demands, despite the good faith effort of the President. This means that republicans are either not cautious of what negotiations are all about and why the definition of the word, negotiation, involves reaching a not so, my position only Plato, whenever two persons or groups are attempting to reach an accord on a difficult issue. A negotiation is a game of give and take, not take, take and take!

The Republican leadership are probably unmotivated by the President stepping into the budget negotiations, though he is hardly obligated to do as such, since most of the work remains that of congress; or, they are hardly interested in reaching an accord with democrats and majority of republicans are probably still at that cross road of making sure Obama is a one term president as postulated by many in their leadership; and or, ensuring that republicans are able to kill the health care reform bill of 2010. Interestingly, despite President Obama’s invitation to the Whitehouse of the two parties’ leadership, to sort out the differences from ideological position of both parties, the attitude of either parties still remain as what they were before his invitation. Change that was expected has hardly arrived; neither has the silver lining to indicate that progress has been reached or some inkling of progress after the splitting of the Vice President Biden negotiation group terminated. The President has held two press conferences this week, obviously showing that he remains engaged in the process and is serious about reaching a big deal with the republicans. However, there is probably not much to show for his acceptance of republicans’ request that he needs to intervene in the broken down negotiations with Vice President Biden’s budget working group.

With the engagement of the President in the negotiation process so highly intertwined with the possibility of success; and the President showing gusto optimism, hoping the two negotiating parties would reach an accord very soon, one is mystified why much has not been achieved since the four-day meeting. Is it because the goals of the negotiations were inadequately defined? Is the involvement of the Presidency a disservice to the negotiation process or is it an additional plus, considering how far both parties have come, although they haven’t reached the final step? By setting specific goals and defining what success on the negotiations should be, negotiating lawmakers from both political parties have the potential to make influential contribution that may receive accolades from the public: raising the debt ceiling and finding additional source of revenue for the nation’s coffers.

The republicans want a constitutional amendment that will lead to a balanced budget, they want federal government to cut spending without raising revenue, and they want President Obama and the democrats to sign up to their plan about the budget and where they want the country to be heading. For republicans, they want greater influence on how the federal government conduct its business regarding spending and want the democrats to accept all their proposals before conceding on raising the budget ceiling. Additionally, Republicans are willing to concede their constitutionally protected lawmaking power, asking the President to seek their approval to independently raise the debt ceiling without their blessing, and hopefully absolving each of them come next year’s election, the probable associated risks of raising the debt ceiling, simply because they have committed themselves to untenable position of not raising taxes to an uncaught tax-hating or tax-adverse organization.

If you ask many other observers of the negotiation processes and the progress so far made at the Whitehouse four-day negotiations’ sojourn, you’ll probably get the assessment that to a certain degree, republicans are all about me, me and me, all along? Republicans are hardly interested in an agreement with the democrats or their leader on this one, since they have already sold their soul to the Gods of no-taxation; and already defined their plan not to concede. That is why, you have the speaker of the house, making a last minute press conference on Friday, saying the republicans have a plan; to which many of us are asking, what plan? Now, the question is, is the republican plan tenable this late or would it garner enough support to move the country ahead? If you ask the republicans, they would say yes; if you ask democrats, you will get a resounding no. This is probably why we are still in the impasse and, hope is fast becoming hopeless and optimism is about fading away. You could imagine that after four-day intensive Whitehouse meetings, the speaker of the house could come to a press podium to ask that the President present a plan! What plan: a plan that is already rejected or one that the republicans can score points against the president on? I imagine the President know that republicans are just playing games and their unyielding position is where they stand and where they would probably perish!

Tuesday, July 12, 2011

Aggressive accounting practices, Debt Ceiling and the Republican Recalcitrance: how the rich continue to cheat the middle class and the poor?

Keywords or terms: Debt Ceiling; Stalemate; Tax Payers and Cheats; Rich and Poor; Josh Voorhees; Robert Murdoch; Conservative; Liberal; Internal Revenue Service; Aggressive Accounting practices; Supply-side Economics; Congressional Lawmakers; The Presidency

It is time to tell it as it is. It is time to disseminate the truth about America’s budget deficit. It is time to call a spade a spade. It is time to remind the Republicans, most of whom are fat cats, that they have been raiding the coffers of the nation and raping the hell out of the finances of this country. It is time to remind Republicans and Democrats that unless there is actual tax reform, where the rich are made to pay just as much as they should and the poor and middle class are treated like fair tax payers, this ongoing debt ceiling stalemate, whether it is out of Republicans grand standing or the Presidency’s right to hold its grounds against assault on Social Security, Medicare, Medicaid, Students loans and more, is hardly impressing many of us; and if things are not appropriately handled by our lawmakers, we may be reaching a threshold of class war in the country. As a matter of conscience, if President Obama has not held his ground on his party’s position of raising the debt ceiling with increased revenue, he would have failed in his duty as the President of this nation. The Republican recalcitrance at this time, is hardly impressive, as a matter of fact, they, the Republican leadership in congress, have lost credibility.

For those who say, I am an alarmist and should temper my assessment with some civility, here are five good examples of why I finally said enough is enough:

1)   Under President G. W. Bush, the nation’s debt ceiling was raised nineteen times, most of the time the money was going to fight wars that no one in government can actually tell Americans with a straight face, is in our national interest;
2)   Many rich corporations continue to use deceptive accounting practices, sometimes referred to as aggressive accounting, to escape taxation and actually reap profit from government coffers to the tune of billions, without anyone in government, including Internal Revenue Services, blinking an eye-lid, simply because it is within the provisions of the tax code;
3)   If Josh Voorhees is to be believed, Robert Murdoch, an Australian American, whose aboard is in Australia, an American only in name because of his investments, has over the past four years, received a tax return from the IRS (the US government) to the tune of about $4.8 billion, when in fact, his media conglomerate should have paid corporate taxes at the rate of 35 percent for a value of $3.6 billion, then someone has to help me understand the grounds of the Tea Party faction in the Republican Party asking their leaders to soldier on against the Presidency on tax revenue;
4)   President Obama’s deal of cutting $4 trillion over ten years, including a swap of increased tax revenue for cuts to entitlement programs for middle class, the poor and the elderly, which are clothed in the name of Social Security, Medicare, Medicaid and Student loan’s payout, at a glance, must be very heart rendering, considering that the rich are already carting away the whole house, through quote and unquote, aggressive accounting practices;
5)   Since an agreement has not being reached between congress and the Whitehouse regarding the lifting of the debt ceiling, Senate Minority leader Mitch McConnell has proposed a fall-back plan that tears up the United States Constitution by asking the US President to usurp what is rightly the rights and power of the congress in order to satisfy Republican's narrow interest of protecting the rich, including corporations as the News Corp, at all cost.

Again, the stalemate in increasing the debt ceiling has raised some very disappointing proposal from Republican leaders in both chambers of congress. Contrarily, we have heard from lucid minded Republicans, who have often shown some steel in their protection of Republican ideology, that voting against raising the debt ceiling, threatens the fiscal solvency of America. Further, we learned from the conservative Republican Columnist George Will, early in January of this year on the ABC’s This Week  that, there is hardly a developed nation that has a debt ceiling and the thought of voting against raising the debt ceiling, is not only troubling for America’s sovereign debts and the market, but may be considered politically suicidal. Despite all these affirmation, it seems as of tonight, nothing has moved the needle from where we were about two weeks ago on raising the debt ceiling, with Republican lawmakers holding the nation to a ransome.

Listening tonight to President Obama’s interview with Scot Pelley on CBS evening news, accepting the fact that not only social security checks that wouldn’t be going out come August 3, 2011, if an agreement is not reached on the impasse, but that veterans and men in uniforms may not receive their checks, make one wonder, what nation do Republican Leaders consider the United State: a place where a lawmaker can refuse to work in the interest of many at the expense of a few rich, 5% of the few holding down on 80% of the wealth of the nation. Now, you see why many Americans are hardly thrilled about the impasses on the issue of raising the debt ceiling and my assessment that we may end up in a class war? How about listening to the fact that due to many loop holes in the tax laws, the rich corporations and people have just been raping the nation through evasion of taxes? How about the notion of rich corporations powering through the lapses in our laws as they move jobs overseas and keep many Americans at the mercy of a free-market system that ends up bailing the rich out under the pretext that their corporations are too big to fail? Do you want me to continue my lamentation over off-shore banking, where many corporate losses are redirected to America, while their profits are moved elsewhere to buy new foreign corporations and investments, while America’s tax payers pick up the tab over poor business decisions of the rich?

The rich can make a positive impact on the nation’s deficit, if they pay taxes at the ratio of pre-1970 level. They can make an impact on the reduction of our budget deficits, if they stop being tax cheats and actually pay commensurate taxes just like the middle and poor classes. A mind set shift is required among the Republican Party members, that the trickle down theology of the Reagan’s years, tagged Supply-Side Economics, is an absolute failure and aberration of psychological behavior of the rich. The Tea Party members among Republicans ought to come to the debate table with sincere inquiries on why there is so much loss of jobs during Republican years in administration of the White House. There are many opportunities for conversations over why America goes into foreign wars that costs a million dollar a second, while fifteen million Americans are out of work and about four million are set to loose roofs over their heads in the coming months. If Republican leaders can help the Tea Party group among them tone down the negativity in their opinions that easily shuts down debates over how we can better our economy, improve government revenue base and take care of our health and grand parents, maybe we will be on the way to truce and not anarchy? If we can help Republicans appreciate that people complain about what they care about, perhaps they will listen a bit deeper and a bit longer over why it is insanity to let the nation go into default on its debts.

The most important thing any lawmaker can do right now is to help America understand what is going on in our congress, why it seems, we can never be in agreement over issues that affect all of us. Whining and hauling, making inflammatory statements like: 1) Obama administration are relying on budget gimmicks to give the appearance of serious belt-tightening; 2) After  years of discussions and months of negotiations, I have little question that as long as this president is in the Oval Office, solution is unattainable; are hardly statesman like nor encouraging to the nation. Americans want to understand their lawmakers, want to know the essence of the impasses over raising the debt ceiling and will be more prepared to deal with the short-coming of a recession, if issues that affect national finances and jobs creation are dealt with transparently by both chambers of congress.

With the right mindset, opening up debates to the whole nation, including what must be done to close the tax loop holes that allow many corporations and people to evade taxes, Americans who are mostly at the receiving end of infighting among lawmakers in congress will be able to breathe easier, stay mellow and overcome the challenges of long waits for placement in a job. The whining you see among many in America today comes out of frustration with congress, why it is not making the right choices to create opportunities for Americans in America and why the conversations regarding issues that affect them are often trivialized on the bases of ideology. A retired old man or woman is hardly interested in ideology fights, but in their sustenance; knowing that their fixed social security income will be able to carry them over to the next check; knowing that if they fall sick, they will be able to see their doctor; and, knowing that the nation still cares about them, after giving all their productive years to serve the nation and the budding youths; most of whom are now in positions of authority and clamoring to cut the old people’s benefit programs, because they happen to be in the position of lawmaking in congress.

I am not treating this discussion with levity. This isn’t what this blog is known for. Republican and Democratic lawmakers must realize that the nation is in dire straits and there is hardly any room for ideological fights or derogation whining from senior members of congress, who should know better. Lawmakers, Republicans or Democrats, who feel they are bored or unsatisfied with the work of lawmaking should retire and let people willing to do the work of the people, move into congress. After all, none of the lawmakers were born with the gavel in their hand. It is important that lawmakers show that they are genuinely interested in serving the people by addressing issues that impact their welfare as urgently as possible, rather than increasing the stress and tension in the nation. The more lawmakers increase their sense of commitment to the people’s interest, especially those who are most vulnerable among us, the children, women and the elderly, the more people will be interested in what comments comes out of their mouths in a press conference. Good Night!