Shutdown Fatigue

The federal government shut down at midnight, when Congress proved to be unable to agree on a another stopgap spending bill.  As is usually the case, the Democrats and the Republicans used the looming shutdown to try to increase their leverage to obtain their political goals — whether those goals are immigration reform, or health care funding, or something else — and when neither side blinked, the shutdown occurred.  Of course, each side then blamed the other.

maxresdefaultWe’ve been through this scenario multiple times before, most recently in 2013.  We somehow made it through each of those prior cataclysms, and I’m pretty sure that the sun will come up today as well.

I may be wrong about this, but out here in the heartland I’m sensing a lot less angst, generally, about this shutdown than seemed to be the case with prior shutdowns.  Maybe it’s because we’ve been through this same, pointless charade multiple times before, and the country just has a lingering case of shutdown fatigue.  Maybe it’s because, with the flood of scandals and tweetstorms and investigations and unseemly behavior that has been washing over the nation in recent months, we’ve already used up our storehouses of outrage and have just been psychologically bludgeoned until we’re functionally insensate.  Or maybe, just maybe, we’ve come to recognize that all of this shutdown stuff is just more callous political maneuvering by both parties, and we’re heartily sick and tired of being viewed as mere pawns to be manipulated in the stupid power games that are always being played in Washington, D.C.

Whatever the cause, we’ll just go on living our lives, without paying too much attention to the yammering politicos and their efforts to pin all of the blame for this unnecessary disruption and unending dysfunctionality and irresponsibility somewhere else.  Who knows?  Maybe if we just ignore this latest shutdown, the politicians might realize that their shutdown gambit isn’t working anymore and actually go back to doing their jobs.


Where Have All The Deficit-Cutters Gone?

From time to time, both Republicans and Democrats express concern about the out-of-control accumulation of federal debt and the annual federal budget deficit.  Republicans raise the issue when they want to get elected.  Democrats raise the issue when they want to stop the GOP from cutting taxes.

But in reality, and for years now, no one in either party has done anything meaningful about the ever-growing national debt.

debt-limit-history-data-for-web-2013-updated-rjr-chart120largeConsider what’s going on now.  Republicans have been laboring over a tax bill for months, and are supposed to get it through Congress and to President Trump this week.  Of course, tax relief is an easier political sell, as rates paid by various constituencies, and backroom deals, get cut.  But where are we on spending?  Well, the House Republicans apparently want to “temporarily” extend spending for most agencies at current levels, with a $650 million increase in defense spending.  In the Senate, where Democrats hold the balance of power because of the filibuster, Democratic leaders say that we need to have equivalent increases in defense and non-defense spending.  Oh, and there’s this, too:  we’re facing another one of those stupid self-inflicted shutdown points, where some government activity will stop unless a spending bill is signed into law by Friday.

So let’s take stock here.  The House Republicans want to hold spending steady, except for an increase in defense spending — i.e., increase spending.  The Senate Democrats want to increase defense and non-defense spending — i.e., increase spending.  And our elected representatives have conveniently maneuvered themselves into a position where they can say that they need to cut a deal that will no doubt increase spending in order to avoid a partial government shutdown.  And by the way, there is absolutely no sign of the kind of thoughtful review of the thousands of ongoing government programs and subsidies and agencies to determine whether they are truly needed and should be modified or eliminated outright — which is what truly committed and rational deficit-cutters would be trying to accomplish.

Gee . . . I wonder why Congress’ credibility with American voters is so low?

In 2018, Does The Pendulum Swing?

Alabama elected a Democratic Senator Tuesday, for the first time in 25 years.  The state is so deep red that the last Democrat to be elected, Richard Shelby in 1992, decided to become a Republican two years into his term.  But on Tuesday, Democrat Doug Jones prevailed — and unlike Shelby, Jones is likely to stay a Democrat for a while.

dfoug-jones-louise-jones-08a67a68d49977afAlabama electing a Democrat to the Senate is so outlandishly contrarian that it has people talking about whether 2018 will bring another “wave” election, where the pendulum swings in the opposite direction and dissatisfied voters rebel against the party in power and vote in droves for the other party.  We’ve seen a number of “wave” elections in recent years, especially in midterm elections, and Democrats are hoping that Jones’ unlikely triumph in the Republican solid south presages a year in which Democrats sweep to power in the House, the Senate, and gubernatorial races across the country — including Ohio.

The question that can’t be answered just yet is whether the Alabama results represent a shift in voter perceptions of Republicans and Democrats generally — or whether it was really a one-off rejection of Roy Moore, the bizarre, deeply flawed Republican candidate who was accused of sexual misconduct and who has lots of other baggage on his resume.  Did Alabamans who formerly have voted for Republicans vote for Jones because they decided that they now like the Democratic platform, or did they vote for Jones because they thought Moore would be an abject embarrassment to their state, or did they not vote at all, allowing the Alabama citizens who always vote for Democrats to carry the day in a low-turnout election?  And if it is the latter scenario, is that brooding sense of malaise by Republican voters due to national issues — like the antics of our Tweeter-in-Chief — and likely to be displayed other states?

Of course, only time will tell.  We don’t know yet who is going to be running in those House, Senate, and gubernatorial races that will be occurring next year, and the talk of a potential wave election may spur a counter-reaction by Republicans who become energized because they don’t want to see the party lose the House and Senate under any circumstances, whether they like and support Trump or find him to be a constant source of embarrassment.

I can’t speak for Alabama, having never set foot in that state, but I’m sensing a lot of unease and uncertainty in Ohio and other places I’ve visited — and while a lot of it involves Trump, a lot of it stems, too, from the sexual harassment allegations that have bedeviled both parties and a seemingly general sense of dissatisfaction with Democrats and Republicans alike.  In such a volatile atmosphere, just about anything is possible.

Hang On To Your Wallets

Here’s some news that should cause all taxpaying Americans to feel a cold, hard lump in the pit of their stomachs:  Congress has decided to focus on “tax reform.”

ap17306662049220Congress’ decision to pivot to tax reform has produced all kinds of news stories, most of which have headlines that can only stoke the angst.  What does the proposed tax reform bill means for the value of your home?  What kind of hidden tax brackets might be found deep in the dense language of the proposed bill?  How will small business owners be affected?  What company’s stock price took a dive because the bill proposes repealing a crucial tax break?  All of these stories, and more, can be found simply by running a google search on “republican tax bill.”

The stories are indirectly reflective of the key problem with the federal tax code, because the many different areas of potential concern they address shows just how wide and deep is the reach and impact of our federal tax structure.  Virtually every company, industry, form of property, job, trade, college, technology, and concept is affected by some form of federal tax or federal tax break.  At the founding of the republic, Alexander Hamilton may have devised a simple approach to raising revenue to fund the federal government, but those days are long gone.  Now, the tax code is a complicated morass far beyond the ken of the average citizen, with special rates and breaks and benefits and exclusions and surcharges that only experts and lobbyists understand.

So, given that reality, why should the average citizen be concerned that Congress has decided it’s time to mess around with the tax code?  Because our political class, Republicans and Democrats alike, have shown they are primarily interested in raising lots of money so they can be reelected . . . which means the risk that some special provision written specifically to help a large donor will be inserted in the dead of night simply can’t be ignored.  And with the Dealmaker-In-Chief in the White House, who’s going to really dive into the details of whatever gets passed, trying to make sure that the average citizen doesn’t get gored while the special interests get their perks and sweetheart deals?

Maybe it all will work out, and the tax code will be made more fair and equitable and easy to understand, and we’ll be able to file our tax returns on postcards like the photo op pictures are indicating.  Maybe — but I’ll believe it when I see it.  Until then, I’m hanging on to my wallet.

Deal Makers Make Deals

President Trump is a deal maker at heart.  After all, he wrote a book called The Art of the Deal.  So is it really a surprise to anyone that President Trump has reached out to the Democrats in Congress to make deals?

trump_the_art_of_the_dealLast week Trump reached agreement with Chuck Schumer and Nancy Pelosi, the leaders of the Democrats in the Senate and House respectively, on an arrangement to raise the debt ceiling and provide hurricane relief funds.  Last night, Schumer and Pelosi announced that they had reached agreement with President Trump on a legislative solution to the status of the so-called DREAMers — children brought to America by illegal immigrant parents who have grown up in this country and who had been protected from deportation under Obama Administration policies.  According to the Democratic leaders, they and Trump agreed to pursue bipartisan legislation to protect the children from deportation in exchange for Democratic support of border security enhancements.  Schumer and Pelosi say the border security enhancements don’t include supporting Trump’s long-touted wall along America’s southern border; the White House says that excluding the wall was not part of the agreement.  It seems clear, however, that some kind of bargain was struck.

These recent announcements give some people the willies.  Rock-ribbed conservatives can’t stand the sight of Schumer and Pelosi, and the idea of actually sitting down and cutting a deal with them is anathema.  And lurking underneath the discomfort is a concern that, in the President’s zeal to make a deal, principles that are considered important to the conservative position might get thrown overboard.  And part of the subtext of that concern, I think, is the belief that President Trump isn’t exactly a master of the details who fully appreciates the significance of negotiating points, and as a result the President might be getting fleeced by savvy Democrats without fully appreciating it.

President Trump’s willingness to have these kinds of talks shouldn’t come as a surprise to anyone.  Deal makers want to make deals.  In the real estate development world, deal makers always want to have some new project to promote, and part of the process is to create a feeling of momentum and movement.  The key goal is to get the deal done, and you commonly sacrifice on deal points and financing terms and other provisions to reach that goal.  Deal makers believe that nobody gets everything they want, but that ultimately the deal itself serves the greater good for everyone involved.

Of course, not every deal turns out to be a good one for all concerned, and politics isn’t quite like a big real estate development.  There are people out there who believe fervently in principles, and when those principles get casually tossed aside in the interest of cutting a deal they aren’t happy.  But polling results commonly indicate that the American people want their political leaders to get along and avoid things like government shutdowns because they can’t agree on raising the debt ceiling.  President Trump’s willingness to cut deals may test whether that polling data really means anything.  And if foreign leaders see evidence that just about any deal is possible, who knows what they might propose?

We’ve got a deal maker in the White House, folks, and deal makers make deals.

The Ever-Upward Irresponsible Trend

Am I missing something?  Nobody seems to be paying any attention to federal spending and deficits anymore.

stacks-of-moneyThe Republicans, who used to be the preachers of deficit reduction, balanced budgets, and fiscal discipline, are much too busy trying to distance themselves from President Trump to do much of anything about anything, much less something detail-oriented and difficult, like tackling federal spending.  And the Democrats never seemed to have much appetite for actually considering whether legacy federal programs make sense in the current world, or are performing as they were intended, or are actually having a positive impact from a cost-benefit standpoint.  Expecting Congress to actually pass a budget seems to be hopelessly passe, and continuing to spend more, more, more seems to be the default approach.  And, given the kinds of deficits we’re racking up, and the experience of Puerto Rico, and Illinois, and other states that haven’t paid attention to basic economic realities, “default” seems like an apt word.

In case you’re interested, June 2017 was the first month in history where the American federal government spent more than $400 billion.  You can see the number — $428.8 billion — on page 2, in the “outlays” column, of this dry document called the monthly report of revenues and outlays, issued by the Treasury Department.   And here’s an interesting statistic, for comparison’s sake:  according to this report from the Congressional Budget Office, the amount of federal government outlays for the entire year of 1976 did not even reach $400 billion.  But ever since that time, it’s been an ever upward trend, and now we’ve reach the point where the federal government spends more in a single month than it spent in an entire year only 40 years ago.

You’d think that somewhere, someone in Congress would be up in arms about what is obviously an alarming and unsustainable trend.  You’d think someone, somewhere would be waving that dry Treasury report around and asking why the spending by the list of the government agencies set forth in small type later in the report needs to be ever increasing, and demanding that those agencies tighten their belts or justify their existence.  You’d think that someone, somewhere, would be glancing uneasily at Puerto Rico and Illinois, looking at the federal trends, and deciding that we need to do something to curb our profligate ways before we’re irretrievably on the road to economic perdition and financial ruin.

Of course, you’d be wrong on that.  It’s much easier to just react to the latest Trump Administration dust-up and let things slide.  The only worrying seems to be done by those of us out in the real world whose practical experiences with household budgets and controlling family spending makes us grind our teeth at the amazing irresponsibility of our elected representatives.

A federal government that spends more than $400 billion in a single month!  And nobody is talking about it.

Lessons From A Crumbling Spillway

People have been holding their breath and keeping their fingers crossed out in northern California.  Thousands of residents from a number of communities have been evacuated after a spillway from the massive Oroville dam was determined to be on the brink of failure.  As of early this morning, fortunately, it looks like the spillway will hold.

oroville-dam-side-view-associated-press-640x480The Oroville Dam story is an interesting one.  California has been struggling with drought conditions for years, but then recently got hit with lots of rain and snow that has filled its reservoirs and allowed officials to declare that drought conditions are over.  Now, though, the spillway failure raises questions about whether the state’s water control infrastructure is up to the task of dealing with water flow in non-drought conditions.

It’s a story that you probably could write about much of America’s infrastructure from the east coast to the west coast, and all points in between.  As you drive under bridges that look to be cracked and crumbling, with chunks of concrete missing and rebar exposed, travel through airports that are beat up and obviously overtaxed, and walk past retaining walls that are bowed out, you wonder about whether the folks in charge are paying much attention to the basics.  And, of course, that doesn’t even begin to address “hidden” infrastructure, like dams and reservoirs, sewer piping and spillways, electrical grids and stormwater drains, that are underground or removed from population centers.  There is a lingering sense that the concrete, steel, and piping that holds the country up has been neglected — perhaps because bridges, tunnels, dams, and reservoirs don’t vote, lobby legislators, or fill council chambers, demanding their share of tax dollars.

President Trump has talked about addressing these infrastructure issues — such as our “third world” airports — and it’s an issue about which there seems to be some consensus among both Democrats and Republicans in Washington, D.C.  But there’s more to it than that.  Not every bridge or reservoir is a federal issue that requires federal tax dollars or federal bureaucrats issuing approvals.  Local and state governmental officials need to recognize that they have responsibility, too, and they can’t continue to shortchange maintenance and improvement of core infrastructure.  Rather than just holding their hands out to Uncle Sam, they need to look to their own budgets and tax revenues to fund the repair and refurbishment effort, too.

Perhaps the Oroville Dam story will get people to start paying attention to what they should have been paying attention to all along.