Facebook Twitter

Stubborn Congress is about to let a fiscal crisis go to waste

SHARE Stubborn Congress is about to let a fiscal crisis go to waste

Republicans, in return, complained that McDonough didn’t even seem certain last week that Obama’s most recent offer, for $1.2 trillion in spending cuts, was still necessary. (It’s still on the table, White House aides said.)

It almost seems like distant history now, but it was really just a few short months ago that President Obama and Senate Republicans, spurred by fear of fiscal chaos, did the unthinkable: They went out to dinner and talked civilly about the possibility of a "grand bargain," a compromise that would shrink the deficit through revenue increases and long-term spending cuts.

But since that hopeful first date, the relationship hasn't quite blossomed into romance — or even into real negotiations.

The deficit is still there, of course, and so — in the long run — is the crisis.

But we've also had some better-than-expected fiscal news, and that has taken the pressure off Congress. Last month, the Congressional Budget Office estimated that this year's deficit will amount to a mere $642 billion, down 24 percent from its earlier forecast of $845 billion. And Standard & Poor's has even upgraded the federal government's credit rating to "stable."

Did that good news inspire Congress to get back to work? Hardly.

"The intensity isn't there anymore," said Sen. Bob Corker, R-Tenn. Congress has a bad case of "fiscal fatigue," he said.

The upturn has been just enough to reassure members of Congress from both parties that they might not need to make any painful concessions after all — at least not before they run for reelection in 2014.

It may seem paradoxical that Congress was willing to tackle a grand bargain when the deficit problem looked big and insoluble — but quickly lost interest as soon as the problem became more manageable.

"There's a lot that seems paradoxical about this place — and this is one of them," agreed Sen. Michael Bennet, D-Colo.

But the reason isn't really mysterious.

A grand bargain would have required both sides to swallow unpalatable compromises. It would have required Democrats to agree to cuts in future spending on Medicare and Social Security. Likewise, it would have required Republicans to accept increases in tax revenue.

Some brave members, like Corker and Bennet, still say both of those measures are necessary. But others are happy just to duck. For die-hard liberals and dogged conservatives, it's a matter of principle. But for others, it's a matter of self-preservation. In a one-sided district or a one-party state, compromising with the other side can mean risking your job in your own party's next primary election.

The two sides still meet occasionally; just last week, for example, Obama chief of staff Denis McDonough met with Senate Republicans to try to revive progress toward a bargain, grand or otherwise. But the most recent session led only to sniping.

One White House official complained to me that Republicans have failed to propose the sort of specific fixes McDonough has asked them for. "Six weeks or so later, they haven't done so — not an entitlement proposal, not a revenue proposal, nada," he complained.

Republicans, in return, complained that McDonough didn't even seem certain last week that Obama's most recent offer, for $1.2 trillion in spending cuts, was still necessary. (It's still on the table, White House aides said.)

A series of predictable events will eventually bring things to a head again. In July, the Pentagon will begin enforcing what may be the toughest mandate of the sequester: unpaid furloughs for 682,000 civilian employees. That will cause a drop in income that will ripple through the economy in August. Then, in September, Congress must approve spending bills to keep the government running in the next fiscal year. And some time after the middle of October, the federal government will run into its statutory debt ceiling again.

But nobody expects a grand bargain anymore. It's more likely that Congress will do what it usually does: Kick the can down the road.

Both sides still say they want a bargain of some size, and they even agree on a few things. Members in both parties say the indiscriminate cuts mandated by the sequester are damaging the economy. And both want to rein in future spending on Medicare and Medicaid.

So in principle, it ought to be easy for Republicans and Democrats to agree to a swap: a smaller and more flexible sequester now in exchange for deeper cuts in health spending later.

But there's one more problem: Some Republicans have become fond of the sequester in its present unlovable form.

"A lot of members of Congress will publicly complain and moan about the sequester — and then privately say it's better that somebody else make the decisions," Sen. Jeff Flake, R-Ariz., told reporters at a breakfast organized by the Christian Science Monitor.

Obama's first chief of staff, Rahm Emanuel, was famous for arguing that politicians should never let a crisis go to waste. "It's an opportunity to do things that you thought you couldn't do before," he explained.

But thanks to the unexpected easing of the fiscal crisis, it looks as if we're about to do just that.

Doyle McManus is a columnist for The Los Angeles Times. Readers may send him email at doyle.mcmanuslatimes.com.