Sunday, February 17, 2013

Debunking Doomsday

The drumbeats of doom are echoing across Washington, DC. Every day the apocalyptic vision of The Sequester looms larger as the clock ticks down to Midnight on February 28.

Conservatives are filling the air waves and the Internet with the horrors of how The Sequester will hollow out the Defense Department and leave America prostrate to a dangerous world. Liberals are countering with their own tales of teachers out of work, parks closed, and the social safety net torn asunder. Both sides are spewing out millions of emails detailing how The Sequester will end life as we know it and wreck America’s economy beyond repair. The media has likened The Sequester to releasing the Kraken and to an asteroid barreling towards the earth.

What is the truth behind these shrill warnings?

What is The Sequester?
In the summer of 2011, the Obama Administration, along with Democrats and Republicans in Congress, decided that the only way to break the strategic deadlock on the budget was to create The Sequester. It was the centerpiece of the Budget Control Act (BCA). It created highly prescribed cuts to the Federal Budget that were designed to be so horrific that no one would ever want them to occur.

How bad is it?
Very, very bad. The Sequester creates deep and detailed cuts to the front line services and operations of every Department and program. The cuts are intentionally designed to inflict immediate and catastrophic damage to the workings of the Executive Branch and to the American economy. This is detailed in

So they created their own doomsday?
Yes. Strange as it may seem, America’s political leaders felt that the only way to stop political brinksmanship over the budget/debt/deficit was to create the ultimate brink. They hoped that the mutually assured destruction of everyone’s sacred cows (conservatives – Defense; liberals – domestic programs; Obama – his economic recovery) would create a spirit of compromise leading to a reasonable and balanced solution. Everything backfired.

What went wrong?
All sides in the budget/debt/deficit battle assumed a reasonable solution would only happen when the other side blinked. No one blinked. The Sequester, instead of avoiding brinksmanship, created a worse one. This is detailed in

Can this be avoided?
Of course. Think of the iconic scene in “Blazing Saddles”. The new sheriff, when faced with angry townspeople ready to kill him, places his own gun against his head and takes himself hostage. In a low voice he screams, “Nobody move!”, while in a high voice he screams, “Help me!” He walks away from the mob and escapes to safety.

In the case of The Sequester, everyone is circling each other holding guns to their own heads. They are all threatening to shoot themselves and all are screaming for help. It is ridiculously surreal, made more so as everyone (including the media) is showing the public only the gun to the head, not the fuller picture of them doing it to themselves.

On January 1, 2013, the first Sequester deadline approached. Congress and the President simply delayed their self-imposed doomsday to the end February. They can vote to reset their own doomsday clock at any time or disable it completely.

So why don’t they?
Everyone still thinks someone else is going to blink. Democrats are “doubling down”, dismissing overspending while demanding more “investments”. The Democrats have become “debt deniers”. Former Speaker Pelosi denies there has ever been a spending problem. Senator Landrieu says spending is a fiction perpetuated by Fox News. Minority Leader Hoyer explains it is not about spending, but about paying for the spending.

Republicans are countering with warnings about America being disarmed and how the economic recovery (which they now admit may be happening) will vanish. GOP strategists are saying that they have Obama right where they want him – forced to make spending cuts to save his recovery. This is delusional. The Sequester will create so much documented pain so fast that the “debt deniers” will say, “See what happens when you cut spending. We can’t cut one dime without terrible consequences. So let’s move on to more spending and more taxes!”

Republicans are so self-involved they don’t realize they are in their own trap. This is detailed in and

Is there a way out?
Yes. Republicans can offer to revoke The Sequester in exchange for Obama conducting a “budget sweep”. This will immediately bring $687 billion in unexpended and unobligated funds back into the Treasury – nearly balancing the FY2013 budget. Republicans should also require a full scale review of $1.3 trillion in additional unexpended funds that reside in various accounts and reclaiming as much as is possible.

This allows everyone to declare immediate victory and eliminates The Sequester. With universal victory and The Sequester gone everyone can sober-up and consider real and lasting solutions to the budget/debt/deficit.

What are those real solutions?
The bi-partisan Simpson Bowles Report, issued on December 1, 2010, and countless other reports recommend entitlement reform as the only action that will really keep America from sailing over a real financial cliff. Such complex reform will take statesmanship instead of showmanship. It will also take time for politicians to move from combat to collaboration.

The way forward is for everyone to get used to working together by tackling less controversial matters. Think of a couch potato wanting to run the marathon. The first step is to walk a half mile and slowly build-up to running 26 miles. This newly minted athlete creates mini-milestones and celebrates them to maintain their momentum toward their larger goal.

For Democrats, they should cede to Republicans that there is at least a management problem with government that causes over spending. Republicans need to admit that this management problem exists every where, including the Defense Department. There are plenty of opportunities for mini-milestones amounting to over $650 billion a year in savings that can either be reallocated or applied to the deficit. There is something for everybody. These are detailed in

For Republicans, it is time to clean-up the Tax Code. Major reforms, like a Flat or Value Added Tax, are not in the cards, for now. Instead, go after the most heinous loopholes and ridiculous subsidies. Eradicating special interest tax breaks will generate upwards of $1 trillion in revenue over the next ten years without harming wage earners. In fact, Republicans could have been heroes by working on these all along, as tax legislation always starts in the House. This is detailed in

Is there any hope?
No. Politicians and the Media do not want to hear the truth or the solutions. The Sequester is too good a story. It helps further everyone’s myopic agendas, none of which are designed to help America or Americans. The media, both liberal and conservative, loves a countdown clock. The Sequester will generate more viewers and readers if things go poorly.

Therefore, it is time for concerned citizens to storm these citadels of cynicism with facts, before the clock strikes midnight.

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