- The congressional August Budget Control Act of 2011 established
the Joint Select Committee on Deficit Reduction - aka Supercommittee.
- Doing so was extralegal. The Constitution's Article 1,
Section 8 explains congressional powers. None of them include supercommittee
authority to resolve America's debt crisis.
- Article 1, Section 8, Sub-section 18 lets Congress "make
all Laws which shall be necessary and proper for carrying into Execution
(of its other listed Powers), and all other Powers vested by this Constitution
in the Government of the United States, or in any Department Officer thereof."
- Even though government authority is limited only by the
boundaries of possibility, no constitutional principle gives 12 members
more power than others, let alone in secret.
- Composed of six House and six Senate members from both
parties, Supercommittee authority ran until November 23 to agree on $1.2
- $1.5 trillion in budget cuts over the next 10 years. Consensus would
have let Congress only vote them up or down without amendments, debate
- Ahead of their deadline, 100 Democrats and Republicans
wrote supercommittee members (the so-called "gang of 12") that
"(t)o succeed, all options for mandatory and discretionary spending
and revenue must be on the table." They, in fact, asked for agreement
on $4 trillion in cuts.
- In other words, they want deep social spending reductions,
mainly Medicare, Medicaid, Social Security, and public pensions. In earlier
negotiations, Obama agreed.
- Nonetheless, hours before their self-imposed deadline,
Supercommittee members ended negotiations without agreement. By law, automatic
$1.2 trillion in cuts over 10 years will start in 2013. They're to be equally
divided between defense and domestic programs.
- In fact, expect sustained military spending at the expense
of gutting America's social contract. Either way, lost purchasing power
means less spending, fewer jobs, and greater public anger than today's
- Progressive Radio News Hour regular Jack Rasmus discussed
what's at issue and what's next. It's not about political disagreements.
It reflects serving wealth and power interests at the expense of popular
- Deficit cutting always is secondary. Key is protecting
corporate handouts and Bush era tax cuts, as well as expanding them for
business and upper-bracket earners.
- Supercommittee Democrat members, in fact, offered unprecedented
Medicare and Medicaid cuts on top of those already made - at minimum, $500
billion over the next decade with increases in out-years.
- They also agreed on $1.2 trillion in automatic cuts,
equally divided between defense and domestic programs and about $500 billion
in tax increases.
- Republicans countered with $760 billion in Medicare and
Medicaid cuts plus about $300 billion in taxes raised largely from middle
income earners by reducing mortgage deductions and others helping less
- In return, Republicans demanded big corporate and upper
bracket personal income tax cuts. Both are now 35%. Republicans want them
reduced to 25 - 28%, so America's aristocracy benefits by deficit reduction
at the expense of working people bearing the burden.
- Rasmus said "Republicans top priority is shielding
the Bush tax cuts." Over the last decade, they cost America at least
$2.9 trillion in vitally needed revenue plus another $450 billion in 2010-2012
extensions. If maintained for another decade, "a projected $2.2 to
$2.7 trillion" more will be lost, exacerbating today's debt problem.
- "By proposing further tax cuts for the top income
brackets and corporations, it is clear Republicans aren't all that concerned
about" deficits and debt. They and most Democrats want corporate friends
and super-rich elites protected.
- They expect working Americans and seniors to bear the
burden so corporations and rich folks are spared. Congressional disagreement
is only about when cuts are made, not amounts, who pays, and who benefits.
It's also about assuring Bush era cuts are preserved and sweetened.
- Rasmus believes Republicans will have a better chance
of prevailing overall by waiting until fall 2012, ahead of next year's
November 6 congressional and presidential elections.
- At the same time, they "see several legislative
choke points" to facilitate greater Democrat concessions without sacrificing
what they want most.
- December will be the first test for resolving four major
bills before yearend, including:
- (1) extending the 2% payroll tax deduction another year.
In fact, it's a stealth drain of hundreds of billions of dollars from Social
Security's Trust Fund. Revenue already lost irreparably weakened its ability
to pay future benefits. Lose more and the entire program may be lost, perhaps
first by privatizing it.
- Obama fully concurs with driving a stake through the
heart of Medicare, Medicaid, Social Security and public pensions. He's
no populist. He's a corporatist hard-liner.
- (2) extending expiring unemployment benefits for millions
of laid off workers.
- (3) another one-year Alternative Minimum Tax (AMT) fix.
- (4) delaying "the 29% cut in doctors fees for serving
- According to Rasmus, if these measures aren't passed,
"it will be a major hit to GDP and the economy in the first quarter
of 2012," at a time it's already faltering.
- As a result, expect Republicans to "drive a hard
bargain and extract more than a pound of legislative flesh" to go
along. They'll demand major Medicare/Medicaid cuts. They'll also insist
on eliminating mandated defense cuts.
- As he's done repeatedly, expect Obama to talk tough,
then cave at the 11th hour. In an election year, he and Democrats can't
do less, despite Catch-22 pitfalls.
- Key is that the above benefits come immediately. Cuts
happen later on, after November 2012. Obama and reelected Democrats can
rest easy. Later it's someone else's problem, especially for Obama if victorious
and senators getting another six years to assuage voter anger.
- Supercommittee negotiations ended, leaving major issues
unresolved. Key is economic weakness, poor job prospects, increased deficits
and national debt, reduced entitlements, and protecting benefits for corporate
and super-rich Americans above all.
- No wonder Republicans left Supercommittee issues hanging.
They'll get everything they want anyway.
- They know Democrats and Obama will oblige like they always
do. Why not when both parties serve privilege at the expense of beneficial
- Stephen Lendman lives in Chicago and can be reached at
- Also visit his blog site at sjlendman.blogspot.com and
listen to cutting-edge discussions with distinguished guests on the Progressive
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