Is nothing sacred? In Washington the answer is no. As the last Congress sought to avoid the “fiscal cliff” and raced toward adjournment, the House refused to vote on a pork-ridden bill sold as aid for the victims of Hurricane Sandy. That triggered a splenetic outburst from Rep. Peter King (R-NY), who complained that the GOP stuck a “knife in the back of New Yorkers and New Jerseyites.”
If the Senate confirms Chuck Hagel as secretary of defense, he will confront a set of challenges similar to those faced by Charles E. Wilson in 1953, James Schlesinger in 1973 and Dick Cheney in 1991. In each of those cases, recent long and costly wars were drawing to a close, and traditional enemies were disappearing or being replaced.
I see that I’m quoted in Annie Lowrey’s New York Times Magazine story, “Washington’s Economic Boom, Financed by You”:
A study [$] published in the winter edition of Political Science Quarterly considers two possible reasons for why the 2009 American Recovery and Reinvestment Act (ARRA) failed to sprinkle Uncle Sam’s magic dust onto those areas of the country that were being hardest hit by the recession.
The Federal Housing Administration (FHA)’s 2012 audit confirmed what has been obvious for some time: FHA is deeply underwater, with a negative economic value of $34 billion. With over $1 trillion in mortgages backed by FHA, even minor changes in the housing market could add tens of billions to that total. A taxpayer bailout is inevitable.
Speaker Boehner says that the House will not pass another increase in the debt ceiling unless the White House and congressional Democrats agree to cut spending by an equal or greater amount. That’s the same line in the sand that Boehner drew during the previous debt ceiling showdown in 2011.
There’s a debate among policy wonks about whether a no-tax-hike policy is an effective way of restraining the burden of government spending.
It seem like it was just yesterday that congressional Republicans took the national debt hostage even though shooting it was never an option. Having just taken back control of the House on a wave of popular discontent over the federal government’s mounting red ink, the pressure was on the GOP to deliver.
It didn’t — and now the rout is on.
Twenty-three point nine trillion dollars. That will be our national debt in 2022 under the fiscal-cliff bill that just passed Congress. That’s nearly $4 trillion more than the current-law baseline, and while most of that comes from making the Bush tax cuts permanent for most Americans without offsetting the loss of revenue through spending cuts, at least $330 billion of the new debt results from the increased spending that was part of the deal. Our government debt will amount to more than 118 percent of GDP.
The faux drama in Washington is finally over. The misfits in Washington reached a deal on the fiscal cliff.