The Debt: Fiddling While Rome Burns
By Ed Moy at MoneyNews.com
When the president and Congress caused a partial shutdown of the federal government and nearly defaulted on some of America’s national debt, a congressional committee was tasked to negotiate a budget deal by Dec. 13. The goal was avoiding another showdown early next year. The result is a very small deal that may lead to the federal government having its first approved budget in more than five years.
Basically, it will keep everything the same but trim some of the mandatory cuts on Jan. 1 (sequester number two) and pay for them by increasing user fees.
For Republicans, avoiding another budget train wreck will keep the focus on the troubled Obamacare. They also keep most of the spending cuts and hold the line on raising taxes.
For Democrats, some cuts in spending are avoided and some revenue is raised.
And for Congress, any budget deal, no matter how small, could be one tiny step into restoring American confidence in that institution.
But a small deal does very little to change fiscal policy, because the how we tax and spend won’t change much. Our current course does very little to trim the massive annual budget deficit and continues to rack up trillions of dollars in national debt. And unless changes are made, this will not end well.
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