Austerity reigns in Europe.
Britain, Spain, Ireland, Portugal, Italy, Greece, Hungary, Belgium, Denmark, and The Netherlands are slashing budgets and raising fees. Even France and Germany are tightening up. All to rein-in deficits.
Austerity in America is what the President’s deficit reduction commission recommended earlier this month. To gain control over our growing deficits, the bi-partisan group said we should cut spending, extend the Social Security retirement age, raise taxes and fees, and more.
Likewise, spending cuts, a softer way to say “austerity,” were the mantra of the Tea Party and conservative Republicans who swept to victory in the recent federal elections.
So, what’s the first thing Republican leaders in Congress forced President Obama to do after the elections?
Nope. They put together a budget busting compromise that cuts taxes, increases spending, and balloons the deficit. It even cuts already inadequate Social Security revenue.
They can perfume this deal all they want, but it stinks of deficit excess. They should call it what it is, “Stimulus II.”
This Stimulus II not only extends the Bush tax cuts but adds new tax cuts with no off-setting spending cuts. It extends unemployment benefits for 13 months. It reduces Social Security payroll taxes by 2% for one year. And, it slips in numerous other spending projects. The total projected add to the deficit is more than Stimulus I.
You may recall that for the past two years Republicans unabashedly fought, and trashed, Stimulus I. House Republican Leader John Boehner gained notoriety for his “hell no we won’t” rhetoric. Yet, it was this same John Boehner along with Senate Republican Leader Mitch McConnell who put together the Stimulus II compromise with the President.
Our allies and the deficit commission tell us we’ve got to have austerity, that we’ve got to bite the bullet and tighten up. Now, either they’re right and austerity is the way to go, or Obama has been right and stimulus is the way to go. But, not this floundering around.
Tax cuts and excessive spending were the hallmark of Bush administration and the Republican-controlled Congress. That’s how the surpluses left by the Clinton administration turned to deficits – huge deficits. The Obama administration and Democrat-controlled Congress took the same tactics to new levels, arguing they were needed to “stimulate” economic recovery during the Great Recession.
Supposedly, the “we learned our lesson” Republican leaders in Congress were ready to say “no” to more deficit spending. But, folks, we’re just getting the same o’ same o’ out of Washington.
The tea leaves from Capitol Hill are not hard to read. They say to expect lots of rhetoric and floundering over the coming months, but no real austerity plan to reduce deficits.