James Leroy Wilson's blog

Thursday, December 27, 2012

Who's to blame for the "fiscal cliff?"

I have no partisan dog in this fight, but I'm fascinated by the way the Republicans are letting the Democrats get a political win on the "fiscal cliff" battle.

This "crisis," if it is one, was entirely manufactured by Nancy Pelosi, Harry Reid, and Barack Obama two years ago. As I wrote about the debt ceiling crisis of the summer of 2011 at the Downsize DC Foundation:
  • In February, 2010, the Democratic-controlled Congress raised the debt ceiling to a level expected to be reached in the Spring or Summer of 2011
  • When they lost the November elections, largely due to the anti-spending Tea Party, it was clear they would lose the power to raise the debt ceiling again
  • They had the entire lame-duck session to raise the debt ceiling until 2013 or longer, or abolish it altogether
  • They did not
Let's add to this some important facts...
  • The President is not a legislator. He has limited veto power over bills.That's it. He has no policy "mandate."
  • The Constitution requires tax and spending bills to originate in the House, not the Senate.
  • The House is the only body of the Federal State that in any sense represents the people in more or less equal districts; The Senate does not remotely represent the people, because a vote for a Senator in Wyoming is some 70 times more powerful than a vote in California.
  • Therefore, in our system, only the House has a "mandate" from the people on tax and spending issues, and the only thing the Senate or President can do is obstruct it. 
Let's suppose, then, that the House passes an appropriations bill for the fiscal year. If the Senate refuses to pass it, or the President vetoes it and no bill is passed by the deadline, then the money can't be spent at all. If the Senate and President complain that the bill spends too little, and would prefer no spending to the amount of spending less than they want, that's their business. But they can't blame the House for "shutting down" the Federal State.

(If, on the other hand, the House passes no bill at all, the Senate and President can blame the House, because they can't act until after the House acts.)

If the House, for instance...
  • passed a bill that maintained the "Bush Tax Cuts" for everyone, and that cut spending by 45% overall to balance the budget and maintain the current debt ceiling, 
  • and rejected all Senate and Presidential demands to modify it...
... then the Senate and President would have to go along, and oversee the shutdown of the Federal State.

The House has the entire mandate and all the leverage.

All the House needs to do is pass a bill. It doesn't have to negotiate. Then it's up to the Senate and President to reject/veto it. If they do so, they bear the responsibility for the consequences.

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