The 2012 political year is right around the corner and the recent failure by the so-called “Super Committee” to reach agreement on $1.2 trillion in deficit reduction will re-cast the environment on Capitol Hill and shape the 2012 campaign.
With divided control of Congress, and a 60-vote threshold in the U.S. Senate, major Congressional action before the 2012 election is now extremely unlikely.
Congress always seems to need a deadlines to make the members focus on the country's business and December promises to be a busy month. It's likely that members of Congress will do the following:
- Pass yet another temporary spending bill preventing a government shutdown on December 16.
- Extend the popular expiring tax provisions (payroll tax, research and development tax, etc.)
In recent years these actions have been taken each December before the end of the calendar (tax) year.
What has become clear this month, however, is that Congress cannot and will not take action on our trillion annual deficits, our $15 trillion debt or pass legislation that will markedly improve the economy.
Now, little more than 11 months from the 2012 election, the governing period has prematurely ended and the political season may begin in full swing, if it ever really ended after the 2010 election.
How will the Super Committee’s failure to produce a result effect the 2012 election? Here are five ways the country will feel the impact of the committee's failure:
1. Congressional action is now effectively dead. Each year, Congress must do a few things to keep the country functioning. From now until the election next year, only the most mandatory business will be acted upon. That means action on expiring tax credits, temporary spending bills, nominations but little else. Capitol Hill will not be where the action is for the next year.
2. President Obama will blame Congress as he runs for reelection. Mr. Obama is facing a headwind in the form of a very weak economy and low job approval ratings. From a purely political perspective to run in 2012 he needed a villain. Now, the Obama campaign thinks they have one in the “dysfunctional Congress.”
Had the Super Committee voted out a plan that was then passed by Congress, President Obama could have hailed the Committee's accomplishment as an achievement, but his campaign theme of running against the Congress would have been weakened. No matter. The Super Committee was designed to fail and the White House knew it. Now, they can try to blame Congress for the deficit and the debt.
3. The Bush tax cuts will be a major issue going forward. Nothing fires up the left wing of the Democratic Party like the Bush tax cuts. When President Obama agreed to temporarily extend them for two years in December 2010, the Democratic Party's base howled in anger. Congressional Democrats appear single-mindedly focused on killing the Bush tax cuts once and for all. Ending them would result in the largest tax increase in American history, over $1 trillion, and that was the price for a deal in the Super Committee. Republicans were not willing to pay it. Expect to hear about this issue often on the campaign trail.
4. America is still facing record deficits and record debt. President Obama promised to halve the deficit by the end of his first term. He didn’t. In fact, the three largest deficits in American history (each over $1 trillion) are on President Obama’s watch. Without congressional action to reduce spending, which neither President Obama nor congressional Democrats want or would allow, the record deficits will continue.
Our national debt just crossed $15 trillion, or 100 percent of our gross domestic product.
5. Fundamental differences between the two political parties will become more important. There are fundamental policy differences between the Republican and Democratic parties and the 2012 election will offer the public an opportunity to choose which vision of the future they prefer.
American is facing major obstacles over the next decade and critical action is required.
Republicans will propose cutting spending to 2008 levels, reducing and rolling back Obama-era regulation, lowering taxes and reforming the tax system and returning to a more limited government.
Democrats will propose bigger government, no reform of entitlements, tax increases and more regulation.
The reality is that President Obama has talked a good game about deficit reduction, but his actions have demonstrated a clear disregard for fiscal responsibility as he’s only brought record deficits and our rising $15 trillion debt.
Whether Americans choose to hold him accountable for the decisions he’s made as president remains to be seen. But the playing field upon which the 2012 election will be fought is evident. The only thing left to determine is President Obama’s opponent.
Matt Mackowiak is a Washington and Austin-based Republican consultant and president of Potomac Strategy Group, LLC. He has been an adviser to two U.S. senators and one governor, and has worked on two winning campaigns.