The budget is fixed if the congress takes a holiday
(8/2012) For the last several months I have been writing and offering solutions about taxes and the deficit crisis. In fact, I was so pleased with my proposed solutions that I half expected to receive a
few telephone calls from some expert economist stating that they would use some of the ideas to save the world’s economy. Well, imagine my surprise when someone told me that the problem was already solved earlier this year? I
was told that the CBO (Congressional Budget Office) did some calculations and, if congress did nothing for the next 10 years, we would end up with a balanced budget. Not that I disbelieved this, but I did some research of my own
and found a news article about the CBO and their prediction: "If congress does nothing – literally nothing – and lets all laws play out as they are currently written in the books, the budget deficient over the next decade
virtually disappears." The forecast was released on Tuesday, January 31, 2012. Instead of looking for something to cut and/or a way to raise revenue, if congress does not meet for the next 10 years, the budget deficient will no
longer be a problem.
This information offered me a different perspective. I have always thought of Congress as two people in a row boat, each facing in a different direction and each rowing in opposite directions, and of
course the boat just goes in continuous circles. In this comparison, just letting the boat drift can and will create a better outcome. As Will Rogers once said, "This country has come to feel the same when Congress is in session
as when the baby gets hold of a hammer." Of course we then have the problem of how to keep Congress out of Washington. Since they don’t show up that often— and when they do, they don’t accomplish much— one would think that would
not be a big problem.
In some ways, this new information appeared too good to be true. So, I conducted some additional research and found out that the CBO’s estimates also included some unintended consequences. One such
consequence is a massive cut in Medicare payments. Apparently, since 1997 Congress has been adding money to Medicare for the "Doc Fix." If Congress does not adjust the payments, many doctors won’t accept Medicare patients. Well,
since I am on Medicare, this is a big problem. Maybe Congress could meet just to add the "Doc Fix?" According to another article, a large problem currently looming is the automatic budget cuts that are suppose to go into effect
at the end of this year. According to the experts, the automatic budget cuts will devastate the military. Maybe Congress could take that up before they decide not to meet for 10 years. And yet another problem is the automatic
increases in taxes. I don’t mind if the rich people are taxed more, but I am semi-retired, I need what I earn. Maybe congress not meeting for 10 years in not as good as it sounds, well maybe… I’m thinking….
"I always thought of congress as two people in a row boat, each facing in a different direction and each rowing in opposite directions, and of course the boat just goes in circles."
You know, sometimes you start in one direction and you think you know where you’re going, but when you get there, it’s not where you wanted to go. It does sound nice that Congress would be on vacation for
10 years, of course they would still want a salary. It also sounds nice that our annual deficit would all but be eliminated, that is except for the "Doc Fix," the military budget, my tax breaks, and I am sure something else
would need attention. However, the largest elephant is still in the room— our national debt. The annual budget deficit is large, but our national debt is larger. You see, the budget prediction only eliminates the annual budget
deficit in 10 years, not the debt, which is the accumulation of our annual budget deficits. Of course that means that for an additional 10 years, we are not paying down the debt and in fact we are still adding to it. This
problem is much larger than we thought.
If we owe $15 trillion now, how much will be owe in 10 years? I was unable to find the answer, but I am sure it would be substantially more. I though each party would be able to take their oars out of the
water and just drift down stream and that would fix our problem. Simply drifting does not even come close to the answer. Apparently, we need both parties working together and rowing to go in the same direction. Oh, and they need
to be moving upstream at a good speed. The more I think about it, the more I think we may have a big problem. How bad do things have to be before Congress works together, rowing in the same direction and does so in our interest?
As was written by David Leonhart, in the New York Times, "As countries become richer, their citizens tend to want more public services, be it strong military, or a decent safety net in retirement. This
country is no exception. Yet our political culture is an exception. It has made most tax increases, even to pay for benefits people want, unthinkable." If David is right, we could be in real trouble. For some strange reason, I
still like the idea of not having Congress meet for 10 years, at least as part of the fix.
Read other articles by Shannon Bohrer