As unsatisfying as the bargain is in substance, its achievement reaffirms an essential element of America’s democracy – the need for compromise. That aspect of the 'fiscal cliff' deal will be needed as the US approaches the debt ceiling and debate on spending cuts and tax reform.
It is hard to say just what Congress averted on New Year’s Day. The “fiscal cliff” was a self-inflicted crisis. And the agreed-on package of tax increases for the wealthy merely postpones a larger battle over debt reduction and the long-term stability of the world’s most important economy.
As unsatisfying as the bargain is in substance, however, its achievement reaffirms an essential element of America’s democracy – the need for compromise – at a time when the tone of the country’s politics must better reflect the gravity of its problems. The significance of the bargain should therefore not be lost in the cynicism about its crafting.
Yes, the deal kicks the can of spending cuts down the road. Both sides are angling ahead of new debates about debt reduction through tax- and entitlement reform as Congress considers raising the debt ceiling at the end of February.
Even so, a Congress shaped by puritanical partisanship ended its session with an old-school gentleman’s agreement between Vice President Joe Biden and the Republican Senate Minority Leader Mitch McConnell, followed by bipartisan approval in both houses of Congress.
Grumbling on all sides means the system worked as the Founders intended it to – bridging majority and minority views – although the deal left President Obama expressing the hope that future policy debates might unfold “with a little bit less drama, a little less brinkmanship.”
The debate over deficits and the national debt elicits strong opinions because it is essentially a moral question: how to meet the needs of today without burdening future generations with our bills.
The current course is unsustainable. The federal balance sheet is still burdened by a decade of tax cuts, foreign wars, and the 2008 housing collapse, while rising health costs and retiring boomers make health-care programs unaffordable.
At the same time, the US is falling behind in investing in areas critical to international economic competitiveness, such as education in math and science, research and development, and infrastructure.