Diary

Dreams,Gays,Russians and the Economy

The lame duck Congress under the Pelosi-Reid regime continues to have misplaced priorities.  There has been much written lately about linking certain Congressional actions to the the two most important actions this Congress should be debating right now.  In fact, it should be the only two things on their legislative agenda.

From the day Obama took office in January 2009 and even before, everyone in Washington was painfully aware that the Bush tax cuts would expire at the end of this year.  Instead of addressing the issue up front- perhaps as part of the stimulus- it was kicked down the road.  Instead, this President and this Congress concentrated on developing, wheeling and dealing and passing a health care “reform” package that actually pleases no one and has created incredible uncertainty in the business community.  With reports that American businesses are  sitting on close to $2 trillion in profits- to those on the left, an obscene sum- unemployment again rose this past month heading towards the psychologically deflating 10% rate.  Hiring is not keeping pace with demand and cannot replace the lost workers in this recession let alone those who would normally be entering the job market absent a recession.  The simple fact is that the Bush tax cuts and the rates today became a political tool for class war rhetoric and was pushed down the line to the point that we are now 27 days and counting from them expiring.

Perhaps the greatest thing this Congress and this President can do to restore some certainty to the economic climate (they could never achieve that 100% thanks to Obamacare) is to extend the Bush tax cuts for everyone.  These cuts could be revisited at a future, predetermined date when an agreed upon point of improvement in the economy occurs.  Perhaps, it could be revisited when there are 12 consecutive months of job growth and decrease in the overall unemployment rate.  In other words, debate would not be reopened  on raising rates on anyone until some predetermined set of economic circumstances occur.  Today, Democrats, despite their spending spree with no regard to the federal deficit, have suddenly become guardians of the federal deficit and warn that extending the cuts to those making over $250,000 a year will increase the deficit by $700 billion over 10 years.  That is still better than the $800 billion in ONE year they established with their stimulus that has achieved very little.

Simply put, the Democrats need to get off their progressive asses and extend the Bush tax cuts so that businesses know the guidelines and rules heading into 2011 and beyond.  Conversely, there is another important economic measure that needs to be dealt with this year.  That is the extension of unemployment benefits.  Lets leave aside the debate about whether extensions prolong unemployment.  At some point, extensions need to be stopped, but the same criteria for determining reopening debate on revisiting the tax cuts can be used to cease extensions of unemployment benefits.  With the most recent unemployment reports that it actually increased, there is obviously an employment problem.  Simply put, there are not many jobs out there.  Period!  One estimate is that for every job, there are 5+ applicants.  There are reports also from the Council of Economic Advisors as well as the non-partisan CBO that extending unemployment benefits does not (1) discourage people from seeking and accepting jobs and (2) actually mitigates future unemployment since for every $1 in benefits, it creates $2 in economic activity.  Imagine the economy if those receiving unemployment benefits suddenly did not have that money to spend.  It is not as if those receiving unemployment benefits are spending those funds on flat screen televisions and luxury cars.  And if they were, so what?  Its economic activity.

I am not arguing for a quid pro quo here- linking the Bush tax cuts to extension to unemployment benefit extensions.  They should both be done on the merits given the current economic situation to eliminate uncertainty heading into 2011.  Regarding unemployment benefits, however, I would argue that paying for them is important.  There are unexpended funds from the stimulus that can be used.  Democrats today argue that unemployment benefits stimulate the economy.  There you go- use the stimulus funds to stimulate the economy by funding unemployment benefits.  Also, the government can use the alleged “profits” from TARP repayments and the General Motors IPO to fund these benefits.

And as a result- accounting for debate and time- there simply is no place in this lame duck session to consider the legislation Obama and company are currently trying to take up.  Harry Reid’s DREAM act- a payoff to the Hispanics in Nevada if there ever was one- could be considered by the 112th Congress as part of an overall immigration reform package.  Obviously, immigration reform has been placed on the back burner but will rear its ugly head once again when the economy improves and people start streaming over the southern border again in search of jobs.  During the economic downturn, it would seem the perfect opportunity, when the influx if immigrants is low, to take up immigration reform sometime in late 2011.  At that time, perhaps some of the better aspects of the DREAM Act can be incorporated into an overall package.

Also, the controversy over DADT needs to be put on the back burner until such time that the appeals process in the courts is resolved.  There are two rulings that are being appealed by the Federal government.  Let that process evolve one way or the other before taking up the issue legislatively.  And once resolved, sometime in 2011 or 2012, make it stand-alone legislation-not attached to some funding bill.

Finally, the push to ratify the START treaty needs to be put on hold.  The ratification of treaties is one of the most important pieces of legislation the Senate can take up.  Its approval requires a two-thirds majority securing its place in importance alongside Presidential veto over-rides and impeachments.  Why the rush?  To hear Hillary Clinton, John Kerry, Joe Biden and Obama talk, it is the difference between life as we know it and nuclear holocaust.  The major nuclear threat facing this country today comes not from Russia, but from rogue states like North Korea and Iran.  While it is true that we have no nuclear arms inspectors on the ground in Russia, neither do they in our country and our technology is far superior to theirs.  Additionally, there are other surveillance means to monitor Russian nuclear capabilities in the meantime.  This treaty, like all treaties, requires extended debate, not a rush job.  There are a few important questions- like the preamble linkage to missile defense- that needs to be addressed.  Incoming Senator Roy Blunt has asked that the 112th Congress take up the issue.  Kerry and Dick Lugar have argued that it is this Congress that did all the investigative work on the treaty and held all the hearings.  And so what?  If the testimony and all the questions have been answered with regards to this treaty, they won’t change and it makes little difference whether the 111th or 112th Congress casts the actual vote.  If there are additional questions, they could be answered in a timely manner, then debated and voted upon.  The original vote in the Foreign Relations Committee in this Congress was a bipartisan 14-4 vote for ratification.  Given the time constraints upon this Congress to act upon more time sensitive issues, Obama and Company should be concentrating on these issues, not a benign arms control treaty.

So it is time for this Congress, in the few days they have left, to address those issues most on the minds of the all Americans- tax rates, jobs, and unemployment.  The DREAM Act and DADT address a small percentage of Americans- gays and Hispanics.  START, although potentially affecting all Americans, is not time sensitive as Clinton and others would have us believe.  In her last gasp of breaths as Speaker of the House, Pelosi would be well-advised to stop playing politics with the Bush tax cuts.  And Reid, before his hold over the Senate is reduced by six members next year, would be well-advised to stop making politically-charged legislative payoffs to minority constituencies.  As the Democrats did with health care, every day they put off these other economic issues, they prove-as they did with Obamacare- that their priorities are misplaced.  In case they didn’t get the message on November 2nd, they should redeem themselves NOW!