The WaPo has this headline regarding the House passage of the fiscal cliff avoiding bill: “Tea party backers swallow a bitter pill in cliff bill”.
A bitter pill?
Not hardly. They went over the cliff! That’s like saying you stubbed your toe when you actually got shot.
Fiscal cliff disaster is averted. The cost?
From the WaPo article:
The bill was 153 pages long. It was written only the day before, by Washington insiders working in the dark of night. It was crammed with giveaways and legislative spare parts: tax breaks for wind farms and racetracks. A change to nuclear-weapons policy. Government payments for cheese.
And, most significantly, the bill will raise taxes but do relatively little to cut government spending or the massive federal deficit.
Yes, we – the small government types, the transparency in government types, the rational types, the freedom-loving types – got totally hosed. We fell off the cliff. They pushed us off the cliff. The chaperone at High School Prom is never welcome there.
In Evolve, Part 2: Incentives, I tell the same story – the story of government strengthening itself, enlarging itself, and promising everything to everyone while ignoring the cost to anyone. Here is an excerpt:
By mid-January, Sheila’s staff had drafted a bill that would appropriate funds for grants to companies and universities to encourage them to work on and train people to work on genetic engineering and therapies. The draft that Sheila’s staff wrote was four pages long and suggested that ten billion dollars would be allocated to these “job-creating” grants. The bill was to be nicknamed the Brighter Future Act.
In the freshman class of Senators, there were two centrist majority members. While they were formally aligned with the majority, they often sided with the minority in voting on certain issues. Sheila perpetually worried that they would, some day, cause her great consternation. One thing that they did not seem to mind, however, was spending money. They, like Sheila, believed that the government had an important role to play in helping those who could not help themselves.
The Brighter Future Act would pass; Sheila had no doubt about that, and it would not matter who was the lead sponsor on the bill. Sheila gave the draft to the junior Senators. “See what you think of this,” she told them. “If you like it, put your name at the top and bring it before the chamber. This is a jobs bill. Thousands, maybe millions of high tech jobs will be created. The press will love this. Everybody will love this. This will be good for your careers.” They looked at the bill. They liked it. They appreciated that Senator Beal had given it to them.
In early February, the Brighter Future Act passed with a large majority of Congress voting for it. The bill that was passed into law was a skeleton, a placeholder. The bill that passed into law was twenty pages long and nominally authorized fifty billion dollars of spending.
As was commonplace, the details of the bill were to be fleshed out by lobbyists and lawyers now that the law was inevitable. Senators met with industry spokespeople. Senators met with University Presidents and Chancellors and Trustees. Senators were taken to the Super Bowl, to the Met, and to see the championship game of the NCAA Final Four basketball tournament. Senators had their campaign coffers filled with generous donations from everybody that stood to gain anything from the bill. The cost of courting the Senators was far less than any of the suitors would receive in return. At the end of March, an amendment to the Brighter Future Act was passed. The amendment raised the amount of money authorized to be spent on the programs contained within the bill to seventy-five billion dollars. More senators voted for the amendment than voted for the original bill. If, the recently converted said, money was going to be spent, then money should be spent in their states.
Those that voted for the bill, Sheila Beal amongst them, spoke about the bill throughout the spring. “The Brighter Future Act will create millions of jobs, high tech jobs, and will lower unemployment and make the U.S. the greatest innovation engine in the world.” “The Brighter Future Act ushers in a new era of smarter spending by the government. These funds are being used in public-private partnerships. The good stewardship and oversight of government is being levered with the risk-taking and competitive nature of the free market.” “To those who deride government spending on innovation as top-down and centralized, this bill is a rebuttal. Funds are being competitively dispersed to industries and universities that exist, themselves, in a competitive environment. This bill is a symbol that government has indeed created a new kinder, gentler, more effective and efficient capitalism.”
Sheila and the majority party’s popularity stabilized. Gene Module Beta had been released and the Brighter Future Act promised to usher in the second, third, and fourth genetic therapies. Congress was working; they were working for the American people. They were getting stuff—legislation—done.
Try as he might, Senator Joseph Ivy was unable to prevent Congress from getting stuff done.
The Brighter Future Act came to exist in a final state in mid-April. The laws governing the disbursement of the funds, what they were to be used for, and how they were to be administered and overseen were set to 354 pages of paper. The final tab: one hundred billion dollars, entirely generated through the issuance of debt.