Debt Deal Puts Republicans in Compromising Position

President Barack Obama has approved legislation effectively raising the debt ceiling, allowing our nation to initially borrow an additional $400 billion with additional borrowing allowed in the future. This may have came as a disappointment to many Republicans, had an agreeable compromise not been reached.

In addition to raising the debt ceiling, the legislation includes spending cuts of roughly $2.1 trillion over the next ten years, with initial spending cuts of $900 billion and a further $1.5 trillion to be decided upon later by a budget committee. Most Republicans have unwaveringly favored spending cuts while opposing revenue increases (tax increases) throughout the majority of the debt-ceiling crisis. Therefore you may see this legislation as a victory for Republicans, as the spending cuts exceed the increased debt ceiling. However, a deeper analysis shows that the apparent Republican victory is short-lived. The legislation does not effectively accomplish the Republican Party’s goal of requiring a balanced-budget for our nation. Essentially, the nation is still allowed to borrow at levels much higher than Republicans deem acceptable. Senator David Vitter of Louisiana criticizes the legislation as wholly irrelevant. ““This so-called solution does not fundamentally change our spending and debt picture,” says the Republican senator. “It just plays around the margins. It does not make any big change whatsoever.” The legislation contains no tax increases, as Republicans wished, but also contains no specific cuts to the most costly programs it opposed. Several Republicans had hoped for over $3 trillion in budget savings and view $2.1 as uneconomical in comparison to the nation’s $14.3 trillion national debt.

Within the legislation lies an amendment in which a bipartisan budget committee is created with the goal of an additional deficit reduction of at least $1.5 trillion. The amendment specifies that should the budget committee fail to find additional deficit reductions by late November of 2011, automatic government spending cuts would take place in 2013. Among these automatic cuts include the Defense Department, an area Republicans have strongly refused to allow cuts to. Should this occur, it would be the first reduction in defense spending in decades. Republicans argue that reductions in defense spending could put our national security at risk, and therefore incompetent to cut when there are highly expensive social programs that the Republican Party opposes.

The compromise that was made defines the definition of compromise. Both parties succeeded in some ways, while sacrificed in others. Republicans across the nation will be pleased to see there are not tax increases included in the legislation, but may not view the other details of the legislation so favorably. With the Defense Department possibly at risk in the future, it is certain the Republicans will push to find spending cuts elsewhere before the November deadline. Republicans who view the $2.1 trillion in spending cuts as ineffective are likely to continue to push for a balanced government budget. As Republican Senator John Barrasso asks, “The question is, are we going to be living by the same rules that apply to every family, every small business and 49 states, which is, that they cannot spend more money than they have?'”

The legislation will have very little effect in the long run if further action is not taken and amendments are not made to enable greater progress. The spending cuts proposed barely put a dent in the national debt, and do little to solve the real, not political, economic problems inherent in America today. Because of political bickering, a rash decision was quickly churned out in the final hours to avoid default, and that decision does very little to prevent these problems from rising again.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: