As President Barack Obama struggles to build consensus in Congress for a resolution authorising a military strike on Syria and Bashar al-Assad’s regime, he must simultaneously brave himself for a new round of fights with Congress over raising the debt ceiling. This ongoing battle, which has permeated Obama’s first term and a half, will surely last the remainder of the President’s second term. Key to any successful increase to the debt ceiling – the legislative cap on the amount of national debt that can be issued by the U.S. Treasury – is House Speaker John Boehner, who has been beleaguered by internal divisions amongst his colleagues over strategy and policy as they seek to engage the President to further curb the ballooning budget deficit.
Whilst Australia was still in the throes of post-election analysis and commentary, The Melbourne Globalist met with respected economist, author and commentator, Dr. H. Woody Brock. A Harvard and Princeton educated economist, founder of Strategic Economic Decisions and acclaimed author of ‘American Gridlock: Why the Right and Left Are Both Wrong – Commonsense 101 Solutions to the Economic Crises’, Dr. Brock spoke on myriad issues, from good and bad debt, the ‘fairness’ of wealth distribution, and the state of academia.
When President Barack Obama came into office in 2009, it was under a wave of optimism and hope for a more conciliatory, robust and bipartisan policymaking process between Democrats and Republicans. The country was in crisis at the time of Obama’s election, and there was the expectation that out of such a situation would come genuine compromise on both sides of the political aisle for the long-term national interest. What we observe in mid-2013 however is a policymaking process frozen from gridlock across many dimensions, none more reflective of this new confrontational reality than the development of fiscal policy.
I wonder what President Obama was contemplating as he joined the four preceding Presidents to formally open George W. Bush’s Presidential Library in late April. Perhaps he was disquieted about the legislative travails suffered during negotiations with Congressional Republicans on the budget deficit and gun control, or maybe he was comforted by the bipartisan negotiations to move forward on immigration reform, or even the sudden resurgence of security as an issue in the wake of the tragedies in Boston.
Throughout the hoopla of the Leadership Spill that wasn’t I was struck by how parlous politics in Australia had become. Then I wandered over to one of my regularly-read blogs, the ever-engaging Ezra Klein on The Washington Post, who highlighted the endemic nature of intransigence in the budget-making process in the US. His broad contention, reinforced by the likes of Jonathan Chait in New York Magazine, is that no matter what President Obama offers in terms of compromise on the budget, it will be met by the same obstinate response from Congressional Republicans to demand more concessions on spending in exchange for any further increases in tax revenue.
As I wrote back in December, everyone understood the need for a deal to be made between President Obama and Congress to avoid going over the ‘fiscal cliff.’ That is, to come to an agreement that would avert the scheduled expirations of a host of tax cuts and reductions in spending on programs like defence and social welfare benefits.
No one ever said being President of the United States was an easy job, and that has certainly been the case for the newly re-elected, President Obama. After a bitterly fought re-election over Republican nominee, Fmr. Gov. Mitt Romney, he was literally back to work the next day, beginning the negotiating to avert the Fiscal Cliff.