We’ve just re-elected the most anti-capitalist, anti-business, pro-government, big-deficit president in history – at precisely the time that the opposite was called for in order to revive the economy.
Meanwhile, we’ve taken a Democrat-led Senate that has failed to produce a budget in more than three years – and which promised never to work with a President Romney – and added even more Democrats.
The word “counterintuitive” comes to mind.
All we can do is move on. In the short-term, the two parties must find a way to avoid the coming fiscal cliff – a toxic combination of huge end-of-the-year tax increases and mammoth, indiscriminate cuts to defense and discretionary spending. This president’s own Secretary of Defense Leon Panetta calls the looming defense cuts (also known as “sequestration”) a “disaster” in the making.
“It was designed as a meat ax,” Panetta told Congress in June. “It was designed to be a disaster. Because the hope was, because it’s such a disaster, that Congress would respond and do what was right. And so I’m just here to tell you, yes, it would be a disaster.”
Indeed, massive layoffs are already on the horizon.
Meanwhile, the expiration of lower tax rates on most taxpaying Americans, and many businesses, combined with new taxes that are part of the health care law, means those Americans who pay taxes will be paying more on Jan. 1.
Unless Congress can get together.
The health-care taxes are likely to stay, since President Obama has been re-elected. But Congress could yet take action to avert the other tax increases and the meat-ax defense cuts.
Given Mr. Obama’s re-election and the Democrats’ retention of the Senate, however, Democrats are likely to dig in their heels and insist on tax increases on upper-income Americans, while resisting any federal spending cuts. It’s also probable that public opinion will turn against Republicans in the House if they try to block the tax increases at all costs.
It doesn’t help that the Republicans’ spending-cut mandate from the 2010 election has essentially been overturned by the electorate of 2012.
We can only hope that Democrats are willing to negotiate reasonable, thoughtful spending cuts to replace the blunt across-the-board cuts now scheduled to take place. The future of the country may depend on it. But Republicans may no longer have the leverage to see to it.
All this needs to happen in a lame-duck session of Congress before Christmas.
It would sure help jittery financial markets if they could do it. The uncertainty over taxes alone is making the markets as jumpy as a frog on hot asphalt. And it has to be dampening business expansion and job creation.
President Obama could help the economy, too, by taking steps to assure the business community that he will be job-friendly going forward – more so than he has been in his first term.
Congress has every reason to get together on all this.
The voters just gave them another one.