Over the past several months Congress has been a bit preoccupied with the self inflicted “debt ceiling crisis”. Now, having passed a worthless compromise bill that does little to solve the country’s financial problems, Congress has recessed for a month; rewarding their weary bones with some much needed time off.
Let’s see what unfinished business has been left to fester while Congress takes a break.
Well, there are three trade bills that have bi-partisan support just waiting to be past. These bills would improve our international trade position and help to stimulate the economy. But they will have to wait until after recess.
There is also a patent bill pending that would make it simpler for folks who wish to manufacture and market new products. This too has huge bi-partisan support and would help to stimulate the economy and increase jobs. But it will have to wait until Congress returns.
There is the much publicized FAA flap that is being held up by a partisan standoff. The FAA has been partially shut down causing 4,000 workers to be furloughed. In addition, over 200 FAA construction projects have been shut down resulting in the loss of over 78,000 construction jobs. Finally, the government will lose over $1 billion in airline ticket taxes because the FAA’s operating authority to collect the taxes has expired. Nothing helps the economy and reduces the deficit more than firing 80,000 people and failing to collect a billion dollars in much needed revenue. But, this too must wait.
“Well”, you say, “Congress can’t be expected to fix everything. These things take time. After all Congress did just pass the largest debt reduction bill in our history; a bill that saved the country from economic default.”
Right! So how did that work out?
Upon learning that this worthless bill had passed, the DOW dropped 265 points. So much for inspiring confidence in the market.
Moody’s responded to the compromise by announcing that they won’t downgrade the country’s bond rating (Yea!) but they are still including a “Negative Outlook” attachment to the rating because the deal didn’t do enough and they have no confidence that Congress will fix the problem in the near future. A number of smaller rating bureaus have already downgraded the country’s bond rating.
The compromise bill failed to address the two main components of our debt and deficit problems: entitlement reform and an overhaul of the tax code. USA Today reports that the costs of Medicare and Medicaid rose 10% in the 2nd quarter. 57.5% of patient bills for hospital, doctors, drugs and other care are paid for by Medicare and Medicaid. These numbers will only get worse as the baby boomers get older and require more and more care. But we’ll just deal with that later.
And as for that historic deficit reduction that Congress worked so hard to pass; economists are now weighing in. They tell us that the legislations long term affects on our runaway spending are inconsequential at best.
So rest easy oh tired members of Congress. Enjoy your time off and your fund raisers. After all re-election is priority one. The people’s business can wait.