Junkyard Dogs Or Outhouse Rats?
OpEd by Elliot Holokauahi Pulham, CEO, Space Foundation
I fear the Republic no longer functions, but we must keep our faith.
I generally try to be as upbeat and positive as possible. Im no Pollyanna, but I subscribe to Thomas Jeffersons theory that more gets accomplished through generosity than meanness.
Yet, our Republic has arrived at a point where it is difficult to find anything generous to say about Congress or the White House, who have abrogated all responsibility to govern in favor of pursuing a course of economic chaos and mutually assured political destruction. What I cant figure out is: are these people just meaner than junkyard dogs, or are they crazier than outhouse rats?
Here are some of the navigational waypoints on the egregiously irresponsible course that Congress and the White House, Democrats and Republicans, collectively, have set the country on:
In order to force themselves to compromise and act collaboratively in the interests of the nation, our elected officials planted a bomb in the federal budget. Fix the deficit and fix the budget, they said to themselves, or well blow ourselves to kingdom come! Well, Congress doesnt respond well to threats, even from itself, and of course no agreement was reached and, as per usual, nothing was done. However, the bomb$500 billion in mindless budget cuts - is still ticking. If it goes off when the timer runs down to zero on January 2, it could plunge the nation into the worst economic collapse it has ever seen.
The unemployment rate will climb above 9 percent, pushing the economy toward recession and reducing projected growth in 2013 by two-thirds. An already weak economy will be undercut as the paychecks of thousands of workers across the economy will be affected from teachers, nurses, construction workers to key federal employees such as border patrol and FBI agents, food inspectors and others. — Dr. Stephen S. Fuller, Dwight Schar Faculty Chair and university professor and director for regional analysis at George Mason University.
The automatic spending cuts mandated in the Budget Control Act of 2011 . . . in just the first year of implementation will reduce the nations GDP by $215 billion; decrease personal earnings of the workforce by $109.4 billion and cost the U.S. economy 2.14 million jobs. -- Aerospace Industries Association study
These cuts will not just impact a few large companies. These cuts will flow down the supply chain and through the broader economy. They will impact companies, like mine and threaten the jobs of thousands of skilled workers. In fact, a report released last month by the National Association of Manufacturers concludes that by 2014, the cuts in defense spending enacted last year combined with the cuts set for Jan. 1, 2013, will result in the loss of more than one million jobs, increasing the unemployment rate by almost 1 percent. — Della Williams, president and chief executive officer, Williams-Pyro
The very prospect of sequestration is already having a chilling effect on the industry. Were not going to hire. Were not going to make speculative investments. Were not going to lean forward. Were not going to invest in incremental training because the uncertainty associated with $53 billion more of reductions in our first fiscal quarter next year is a huge disruption to our businesses.Robert Stevens, chairman and chief executive officer, Lockheed Martin
The media is just beginning to catch on to what is happening here. Sadly, we probably wont see any real urgency on the part of Congress or the White House until the first week in October. At that time, the federal Worker Adjustment and Retraining Notification Act (WARN) will be triggered and hundreds of thousandsperhaps millionsof workers across the country will begin getting pink slips from companies that do business with the federal government. Not only is this grotesquely irresponsible government, but, triggering mass layoff notices one month before the general election has to go down as one of the most politically stupid moves of all time.
Which returns us to my original question: Are these people just meaner than junkyard dogs or are they crazier than outhouse rats?
Debt Ceiling Vote
Intertwined with sequestration is the issue of dealing with the U.S. federal debt ceiling. Should we raise it? Lower it? Leave it alone? While we can argue about whether the debt ceiling is where it should be, the fact is that it is there. Statutorily, you cannot exceed it, yet well almost certainly need to if we are to deal with the federal budget responsibly. But by how much? And for how long? As economist Edgar R. Fiedler said, Ask five economists and youll get five different answerssix if one went to Harvard.
One actually sympathizes with members of Congress on this point. After all, for the past two decades weve heard nothing but how bad it is for the U.S. dollar to lag behind the Euro, yet, now that the currencies are nearing parity, were being told how bad that is! Well, which is it? I cant believe Im quoting Rupert Murdoch, but theres something to his observation that we all know economists were created to make weather forecasters look good.
The problem is that Congress sometimes relies upon experts to advise them. In this case, the experts are economists and, as George Bernard Shaw said, If all the economists were laid end to end, theyd never reach a conclusion.
Still, Congress does need to act. But it is showing no signs of doing so.
All this inaction is almost certain to result in government operating under yet another continuing resolution in FY13. What this means is that only the Department of Defense is likely to have a congressionally authorized budget. So, at the end of the day, government continues on, with no changes, guidance or direction from Congress. Urgently needed program changes cannot be made. Wise and prudent budget reallocations cannot happen. Proper prioritization of services and programs cannot take place, neither within agencies nor among them. Rather, Congress institutionalizes the status quo, which has brought us to the brink of economic disaster.
About the author
Elliott H. Pulham is the CEO of the Space Foundation, based in Colorado Springs, Colorado. For more information on the organization, head over to their website.