As the deadline for the super committee to come up with a plan to trim $1.2 trillion from the budget or face across the board cuts nears, it might be the right time to recall that several respected economic thinkers (Veronique de Rugy, Dan Mitchell, and Peter Suderman) have argued that the automatic cuts might not be the worst thing that could happen.
But don’t worry: Congress may well manage to come up with the worst thing that can happen.
That would be a failure to reach a deal followed by finding a way to avoid the trigger, which would demonstrate that the Congress was never all that serious about the budget anyway.
A piece on the Atlantic Wire sums it up this way:
They can't strike a deal so they want to pull a fast one. With only one week left, members of the bipartisan Super Committee are resorting to accounting gimmicks and legislative sleights of hand to magically produce $1.2 trillion in deficit savings without significant tax increases or spending cuts.
The book-cooking has even awoken infrequent tweeter Donald Rumsfeld, imploring the committee this morning to "End the budget gimmicks. Congress and candidates should tell us what they will cut now, not in a decade."
Talk that the super committee will defer a decision is interesting because the committee was created in the first place solely for the purpose of deferring a decision about the budget during the debt ceiling crisis.
A Gallup poll released on Monday puts congressional approval at 13 percent—gosh, that seems awfully high. As the Christian Science Monitor notes, a bad end of the super committee’s work could drive it lower:
“This deficit reduction deal has symbolic importance above and beyond trimming $1.2 trillion,” [Frank Newport, Gallup’s chief editor] says. “It’s symbolic of how well Congress can get its act together in the eyes of the public. Failure would hurt not only the image of Congress, if it could go any lower, but also hurt consumer confidence, which would in turn have an impact on the economy.”
Yeah, their ratings are bad, but, as usual, we are left holding the bag.