Do-Nothing Congress Dithers on Budget as Deadline Nears
Comment of the Day

November 29 2013

Commentary by David Fuller

Do-Nothing Congress Dithers on Budget as Deadline Nears

Here is the opening for this reportfrom Bloomberg:

Congress's latest attempt at crafting a budget plan is on track to end up the same way as others have in the past decade: with little or no agreement.

Negotiators have little chance of breaking this string of futility, even after a 16-day government shutdown in October that cost the U.S. economy $24 billion. If they do, it'll only be to curb automatic spending cuts, including $19 billion that hits the Pentagon starting in January.

Now budget experts, labor unions and business groups are saying enough's enough, and questioning why lawmakers can't live within their means the way ordinary Americans do and instead lurch from one budget standoff to the next.

"It's a stupid way to run a country," said Maya MacGuineas, head of the Campaign to Fix the Debt, a non-partisan advocacy group whose members include business leaders and former lawmakers. "Change comes from two possible things: a crisis or leadership."

One of the co-chairmen of the campaign is Michael Bloomberg, founder and majority owner of Bloomberg News parent Bloomberg LP and the New York City mayor.

Unlike with previous budget panels, including the failed 2011 supercommittee, there are no immediate consequences if the budget conference misses its Dec. 13 deadline -- the U.S. won't default on its debt and the federal government won't shut down for lack of funding.

The committee's lack of progress is frustrating outside groups, especially business executives, who say congressional lawmakers' habit of governing by crisis and temporary spending bills is hurting the economy and costing jobs.

"The uncertainty has a chilling effect on job creators, households and anybody who's trying to see around a corner," said MacGuineas, who is also president of the Committee for a Responsible Federal Budget, a fiscal advocacy group.

David Fuller's view

"It's déjà vu all over again", as the immortal Yogi Berra famously said.

Having seen Michael Bloomberg control meetings before he was elected Mayor of NYC, he was a no nonsense high achiever, and Maya MacGuineas quoted twice above, also sounds formidable. However, the ideological chasm between Democrats and Republicans remains unusually deep. Therefore political governance remains the biggest headwind for the US economy. The overextended US stock market will not always remain immune to this impasse.

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