According to polls, the foremost concern on the minds of voters this year is the economy. But what is arguably the most important economic debate of the next two years will happen after the election but before any newly-elected representatives take office. Before year end, Congress will have to decide whether to avert an impending recession and how to do it. Yes, a recession. Experts predict that unless Congress changes the 2013 federal budget, the United States will be back in a recession by early 2013.
How did we get into this predicament? Last year, in a deficit-cutting frenzy, Congress passed large spending cuts (the “sequester” plus others), most of which begin in 2013. In addition, several tax cuts are scheduled to expire at the end of 2012. The combination of spending cuts and tax increases will shrink the deficit by a whopping $600 to $700 billion. But given the weak state of the U.S. economy, this huge economic shock is projected to cause a recession with the loss of over 4 million jobs. To avoid this economic disaster Congress must reduce the deficit by much less than $600-700 billion.
So, very soon after the election, our current representatives should begin debating which spending cuts to postpone and which tax cuts to continue. To anyone to cares about fairness, the way forward should be clear: continue the tax breaks for middle- and lower-income households while letting tax cuts for the wealthy expire. Similarly, Congress should continue spending on core government functions and safety net programs while going forward with the planned cuts in military spending. This will not threaten our security; if all the military cuts are enacted, spending will decline to its 2007 level. That was not a year when the military was underfunded. Learn more.
Congress will, hopefully, show more wisdom and willingness to compromise on the 2013 budget than has been the true over the past two years. And while our votes in November won’t directly impact this debate – it will happen before the year is over and the new Congress takes office – there is a lesson here for voters. There is a fine line between a person who stands on her principles but is also willing to compromise, if necessary, for the good of the country, and another who refuses any compromise. A well-functioning democracy depends on the former and is harmed by the latter. Since this will not be the last high-stakes debate, on November 6 let’s elect statesmen and stateswomen, not ideologues.