Fiscal Cliff: the Best Bad Idea?
Clearly our sick federal fiscal policy needs a cure. The "fiscal cliff" is certainly a bad idea. But, of all the bad ideas suggested by both Republicans and Democrats, it is probably the "best bad idea" we have. As such, we should adopt at least some of it.
It is difficult to find something complimentary about the fiscal cliff. It is about as hard to say that the fiscal cliff has value as it is to cite the valuable contribution of the Third Reich to mass transportation by applauding Hitler's development of the Volkswagen Beetle. But the VW had its value, and so does the fiscal cliff.
One idea behind the fiscal cliff is actually revolutionary. It, indeed, recognizes that the United States has a spending problem, but it goes beyond that sound bite.
Perhaps it is heresy to say it, but our spending problem is actually based on a flaw in our constitutional division of powers. In the past two centuries, Congress has not only raised money for the federal treasury, but has also directed how each nickel is to be spent.
Even when President Nixon tried to trim the federal budget by impounding or "sequestering" money ordered spent by Congress, the Supreme Court ordered that the executive spend the money Congress demanded.
Now, I support the democratic process when it is spelled with a lower-case "d." But I recognize that the "spoils system" is a deeply embedded unintended consequence of that system. For the executive, the spoils system means that jobs go to the supporters of an election winner. But for the Congress, it is worse. In an atmosphere where millions are needed to elect a single representative, Congress has become a piggybank for well-connected interests on both the left and right.
To oversimplify, Republicans want to use taxes to support business interests and manufacturing. Democrats want to use the treasury to support unions and the Welfare State. The rest of us are here merely to support their spending and borrowing habits.
So how can the fiscal cliff help?
The fiscal cliff requires the executive to "sequester" a portion of its budget. So, instead of Congress giving the executive a budget, it gives each government department a voucher to spend a specific amount of money. It changes the role of Congress, in part, to a branch that raises money but does not order exactly how every cent is spent. It gives the president an "allowance" instead of a budget.
Vouchers may or may not be good for Congress to give state Medicaid agencies, but it is a budget solution for federal executive spending. It would reorient government agencies into the roles that most of the Founding Fathers expected when our Constitution was ratified.
Then, it was expected that Congress would check the profligate spending of the executive. Today, compromise means that both branches want to spend the nation into bankruptcy and argue over how much the electoral loser should pay prior to insolvency.
If the Congress were in charge of raising taxes and the executive were in charge of spending the money, the Congress could place real limits on executive spending while being freed from the prerogative of giving our tax money as Christmas presents to their local supporters.
The voucher system would blame the president, not Congress, for programs deemed to fall into a category of "political waste." More important, it would give congressional representatives plausible deniability for failing to fund the projects and tax loopholes of multimillion-dollar donors.
In such a case, clearly the presidential election would become more important. But so would presidential responsibility and blame for imprudent or corrupt fiscal decisions. It would give Truman's motto "the buck stops here" real meaning. But, it would also create an even more important congressional corollary: "Here, we stop the president's buck."
Everyone, even the president, knows we need to cut our spending, but no one wants to report to constituents and contributors the exact cliff cuts that are required. Ideas like those embedded within the fiscal cliff may be the only answer to the real need for spending cuts.
The ideas on top of the cliff may be the key to surviving the rocks below it.
Robert M. Levy is chairman of the Moore County Republican Party. Contact him at Law52@prodigy.net.
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