The Do-Nothing Congress Signs a Do-Nothing Deal
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The Fiscal Times
August 2, 2011

With all the moaning about how the $2.3. trillion debt ceiling deal will ruin the economy, starve old people, deny children their educations, and put criminals on the streets because of deep cuts in spending, one voice in the Senate says bah, humbug, "there are no real cuts in the deal."  Dr. Tom Coburn, a Republican from Oklahoma, speaking on MSNBC today, said the entire debate and debacle was simply Washington theatrics, and that "politicians won and Americans lost."

Coburn seems to be one of the few in Congress who knows basic math, and his calculations about the nation's  growing fiscal gap -- estimated at $211 trillion in 74 years by Bloomberg Businessweek -- have turned him into a fierce deficit hawk.  Last month he unveiled his own $9 trillion debt reduction plan which, together with half a dozen others, ended up in the debt pool.  Coburn knows that his plan, "Back to Black," is controversial but says  that even if it was cut by half, we'd be on our way to a grand deficit reduction bargain that would at least begin to show how serious we are. 

One of the more toxic elements in his plan, at least to Republicans, was the elimination of almost $1 trillion in tax breaks over 10 years.  Coburn was one of the few in Congress to go after Grover Norquist and his intractable position on tax increases.  That's probably why, as a member of the Gang of Six, he walked out on negotiations when his Republican colleagues were unwilling to make any concession to tax increases and Democrats were unwilling to cut Medicare.

Coburn's position on tax reform was punctuated today when he said, "There’s not one tax expenditure eliminated in this [deal].  Think about the loopholes that don’t help anybody except a select few.  What you have to remember about tax loopholes is we’re causing people to misdirect capital which gives less benefit to us as a country as a whole through job creation.  When you’re directing capital to lessen somebody’s tax liability versus increase the return on that capital from its employment, we actually hurt everybody—those that are paying taxes and those that aren’t."

Coburn sounded like millions of Americans who became disgusted with the petty and petulant behavior  of the leadership on both sides.  (One friend described the last six months as a marathon tenants' meeting at a New York apartment building.)  He complained bitterly that the can is being kicked further down the road:

• "We’re adding $830 billion to the deficit over 10 years;
• We cut the rate of spending, not spending;
• We’re playing the Washington game again where we call a cut a slowdown in spending, vs. what America thinks of a cut:  I’m going to spend less next year than this year."

Cutting defense spending is, of course, a lightning rod for many Republicans and Democrats alike.  The Pentagon over the years has spread the wealth of its generous contracts among the states, thereby giving representatives a stake in the action.  The debt ceiling bill includes $350 billion of cuts in national security programs, including defense.  But according to Foreign Policy, "Despite the White House's claim that the new debt deal would cut $350 billion from defense spending over the next ten years, there are no specifics in the bill on defense cuts --and no way to tell what the final cuts will be."

"I don’t know of any program that was eliminated. I don’t know of any duplication that was eliminated.  I don’t know of anything that is set in stone that it can’t be reversed with a vote of 60 people in the Senate,"  Coburn said.

Americans are not good at ambiguity.  We like tidy endings to problems--winners and losers, good guys and bad guys.  And always, a happy ending.  But if Tom Coburn is right, we may be in for a big disappointment.  He added, "I think we ought to be dead honest with the American people, there’s just a lot thing we’re not going to be able to do.  We’re in big trouble.  There’s going to be a worldwide debt wall hit sometime next year.  It’s going to impact us.  We’re starting to act and behave just like Greece."

Editor in Chief Jackie Leo, former EIC of Reader’s Digest, Consumer Reports, and Editorial Director of ABC News’ Good Morning America, is an award-winning journalist and author. The Fiscal Times is her 4th start-up venture.