When you read my last column, the United States enjoyed an AAA rating on its $14-trillion-plus federal debt, was anticipating a budget deficit in excess of $1 trillion for fiscal year 2011, and was reaching the debt ceiling on future borrowing. As you read this column, Congress and the administration have, after a debate charged with rhetoric aimed more at the next elections than addressing the difficult problems at hand, once again adopted a short-term interim solution to the deficit and debt-ceiling challenges. The resulting fear of continued political gridlock in achieving long-term solutions, in the face of the arrival of a day of reck- oning by the end of this year, caused Standard and Poor’s to do what conventional Washington wisdom had thought unthinkable—downgrade its AAA rating for the federal debt.
The question of the day is whether our elected officials are up to the task of reaching the compromises necessary for a long-term solution, without inflicting unnecessary harm by waiting til the last minute to do so. If recent experience is a guide, we will not know the answer until late December. It should be remembered that the United States was facing the specter of a default on its financial obligations in April 2011, when the nation’s debt ceiling technically was reached. However, Congress and the administration chose to postpone action on the debt-ceiling issue by utilizing what has now become the accepted practice of having the Treasury “borrow” from the pension accounts of federal employees, a practice which under government accounting rules does not count against the debt ceiling.
Even with this postponement of the debt ceiling deadline until the beginning of August, Congress and the administration were unable to reach agreement on a long-term solution. Instead, we witnessed a dysfunctional Washington waiting until the very last hour before once again adopting an interim compromise that delegated responsibility for crafting a long-term solution to a 12-member “supercommittee” of the Congress. If the supercommittee is unable to agree on a proposal reflecting the concessions needed from all sides in order to survive up or down votes in the House and Senate, this December the nation will face an even uglier replay of the events of this past July.
In the interim, it is not surprising that the heated and often strident debate over federal budget deficits and the overall federal debt has made it more difficult for Washington to address other significant pending matters. For example, Congress has yet to adopt a federal budget for this or next year and is in danger of having to rely on continuing resolutions to fund the government for next year, as it has already done for this year. Yet, these bills are an essential part of the effort to address economic growth and job creation, which clearly have become our top priorities.
Another example of gridlock is the inability of the Senate to consider and vote on the pending nominations for the numerous vacancies on the federal judiciary and in the executive branch. Yet, without talented federal appointees serving in positions of responsibility and trust, the federal government cannot perform its functions.
And, similarly, Congress has before it important legislation addressing tax reform, foreign policy, trade and energy initiatives, health and safety issues, and a gamut of other social and economic issues. Yet, without the curtailment of attack rhetoric from the appointed and self-appointed spokespersons for the extremist positions of both political parties, Congress will remain forced to work in an atmosphere lacking in the comity and cooperation needed for passage of even noncontroversial legislation.
At the moment, as we enter into our next election cycle, we are still the masters of our own destiny. Circumstances around the world, over which we have little or no control, can and will have profound impacts on our continued ability to set our own course. If we are to maintain our economic, financial, and energy security for ourselves and our children, it is incumbent upon our leaders, whether elected or in pursuit of elected office, to engage in civil discourse and compromise, when necessary, to keep secure our cherished shared objectives of life, liberty, and the pursuit of happiness for all.