What now after the Supercommittee’s super fiasco?

The failure of the Supercommittee to reach an agreement is a super fiasco, but was the task of the twelve committee members doomed for failure from the start?

In the highly partisan atmosphere of Washington, it’s hard to conclude anything else. Not even the threat of sequestration at the sum of 1.2 trillion dollars starting January 2013 was enough of a threat to make a dent in the entrenched positions centering around the Republicans’ resistance to accept a balanced approach, paid for by both cuts and higher taxes for the richest in this country.

For next year, election year, there is no reason to believe that the deep ideological divisions between Democrats and Republicans will dissipate. On the contrary, they will probably deepen even further, which, in turn, will mean that the political paralysis in Washington continues.

That’s a most depressing outlook for America for it means that anything to stimulate today’s depressed economy is likely doomed to fail and that the fate of the country now lies in automatic budget cuts in domestic and military programs triggered by the fiasco of the Supercommittee.

Is there a silver lining in this fiasco? Washington Post economic columnist and blogger Ezra Klein, citing the Center on Budget and Policy Priorities, writes:

“If Congress simply does nothing for the next few years, the fiscal picture will improve by about $7.1 trillion over the next ten years. About $4 trillion of that is the expiration of the Bush tax cuts” (from 2001 and 2003).

But that’s no way to run a country and neither party likes such an outcome for various reasons. The Republicans want all the tax cuts to be permanent and they are deeply worried about looming automatic defense cuts and will try to work around them. But President Obama, urging Congress to keep going, also promised to veto any end runs. There are “no easy off-ramps,” he said. The Democrats also need a debt deal but don’t want the tax cuts to expire for the middle class. So both sides should be interested in continuing to negotiate.

Instead, the blame game between Democrats and Republicans is now on. It remains to be seen which vision of America the voters will believe – it will decide next year’s elections. And maybe that’s what they all want?

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