More broadly, the downgrade reflects our view that the effectiveness, stability, and predictability of American policymaking and political institutions have weakened … [W]e have changed our view of the difficulties in bridging the gulf between the political parties over fiscal policy, which makes us pessimistic about the capacity of Congress and the Administration to be able to leverage their agreement this week into a broader fiscal consolidation plan that stabilizes the government’s debt dynamics any time soon.
The postponed crisis arrived on schedule. With the Election Day milestone crossed, President Obama reelected, and the fiscal cliff now visible on the horizon, the lame-duck Congress faced its deadline. Now adept at showdown tactics, in a short few weeks the Tea Party caucus generated rash demands, mounting threats, challenges to Boehner’s leadership, and narrowing expectations that congealed into hard feelings and an impasse. There was no attempt at good faith negotiation.
Finally, with the clock running out, the White House and Mitch McConnell pulled another agreement out of their sleeves. This time it would make permanent almost all of George Bush’s tax cuts. It made no effort to replace the sequester’s arbitrary, automatic cuts with more thoughtful solutions. Instead, it proposed that if Congress and the administration could not reach agreement over the next sixty days, the sequester would automatically take effect. I was one of only eight senators to vote against the bill.
At the time, commentators hailed the deal as a major feat of bipartisan agreement. This is a baffling conclusion about a deal that then appeared and (even more so) now appears to be nothing short of total victory for Tea Party members and their allies.19 Permanently extending the Bush tax cuts represented another huge loss in revenue. At the same time, the inevitable inability of the parties to reach agreement would mean that the mindless cuts to discretionary spending would begin (and without any member of Congress actually voting for them).
There is a grim coda to this story, proof that no matter how low we go, someone will find a way to go even lower. In March 2013, after it had still failed to act and with the sequester now in full effect, Congress voted to fund the government for an additional six months. This presented newly elected senator Ted Cruz with an opportunity he could not resist. For months, Republicans had failed to fulfill their promise to repeal the Affordable Care Act. Now, he would seize on the tactics employed by his Tea Party comrades in the House. He rallied his troops by claiming that the threat of a government shutdown would force the Obama administration to defund the president’s signature program.
Cruz shut the government down for sixteen days. Ultimately, he accomplished little other than to demonstrate that in lieu of becoming an effective legislator he could become a celebrity in his own reality TV show, raising awareness of and money for his campaign.20 He also demonstrated that he was able to read Green Eggs and Ham and other writings as he occupied the Senate floor for hours on end. Even as the shutdown drove American confidence in the leadership of the Republican Party and Congress to new lows, Cruz boosted his own favorability rating with Republicans (according to the Pew Research Center) by eleven points and with his Tea Party base by twenty-seven points. He would ride the momentum he generated by shutting down the government to a first-place finish in the Republican Iowa caucus in 2016.
V. “I Alone Can Fix It”
I remember Ted Cruz’s government shutdown vividly, for a lot of reasons. For one thing, I was there for some of it. His hypocrisy had a papier-mâché grandeur to it. One of the casualties of the shutdown was the World War II Memorial, which the National Park Service had to close until the government reopened. A number of Tea Party lawmakers were incensed. Senators Ted Cruz and Mike Lee, along with Sarah Palin, led a rally at the memorial to protest the closing. Cruz asked, “Why is the federal government spending money to erect barricades to keep veterans out of this memorial?”
But there is a more important reason why the shutdown is etched so vividly in my memory: it coincided with catastrophic flooding in Colorado—the kind of event that reminds you what responsible government can do for ordinary people.21 In early September, Front Range towns from Fort Carson to Fort Collins received a year’s worth of rain in a week, causing the most devastating floods in the last half century. Once rain-soaked mountain ground can accept no more water, the overflow obeys the laws of gravity, pouring into creeks, streams, and then rivers that carry water downhill, feeding into the South Platte and Arkansas Rivers. Rapids became torrents, and torrents became hurtling cascades—rolling boulders, stripping mountainsides, ripping trees out by their roots, tossing cars and trucks like toys, ramming bridges with silt and debris, and tearing canyon towns like Jamestown and Lyons to shreds. The mountain waters then poured east over the plains. More than twenty-eight thousand houses were damaged and eighteen hundred were destroyed. The state lost 486 miles of highway. Tens of thousands of people were displaced. Ten lives were claimed. Destruction tore across twenty-four Colorado counties, at a cost of $4 billion.
Even before the rains stopped and the water had receded, the resilience of our citizens, of their local elected leaders, and of our institutions was on display across Colorado. President Obama directed federal search-and-rescue services, supplies, logistical support, and manpower to Colorado and provided financial support to local governments and the people they represented. Neighbors, volunteers from around the state, and public servants joined together in community churches and schools to work with people from relief agencies, government experts, and strangers from across the country (and even from other countries). They were clear about their job: build things back better than they were before the rivers rose.
It occurred to me at the time that no state or local leaders confronted with a natural disaster could have governed as recklessly as we did in Washington in those same weeks. No mayor, city council member, or county manager could have walked a dog along the street, bought stamps at the post office, or faced fellow citizens at the grocery store without feeling embarrassment and shame for having shut the government down to score a political point in a quixotic charade. We should ask ourselves why we hold Congress to a lower standard.
And it would only get worse. After 2016, Republicans controlled the presidency and both houses of Congress. After years of deficit scolding, admonitions against overspending, and dire warnings about the economic fate of the Republic—after years of this, they now had a chance to lead the country toward the new era of fiscal restraint they had been demanding. To some degree, doing so might even have made sense. As President Obama turned over the keys, the economy had grown every year since 2009. The nation’s deficit had fallen to $585 billion, roughly half of what Obama had inherited from George W. Bush and a third of what it had been at the depths of the Great Recession. Very little of that deficit reduction could be attributed to the destructive strategies the Tea Party had adopted. Most of it resulted from tax revenues generated by a growing economy. On its face, it might have been a good time for prudent legislators to conserve resources in the event that we were faced with another economic or foreign policy crisis.
Instead, after all the years of incessant obstruction of the country’s business in the name of fiscal responsibility, the Republican Party nominated a candidate who promised to deliver “a giant, beautiful, massive” tax cut; pass “one of the largest increases in national defense spending in American history”; and “not touch Social Security, Medicare, or Medicaid.” How would Donald Trump pull off this math-defying act? “I alone can fix it,” he had claimed in his nomination speech. He would erase our debt in eight years by “vigorously eliminating waste, fraud, and abuse in the federal government, ending redundant government programs, and growing the economy,” as well as by “renegotiating all of our [debt] deals.”
What he actually did was cut taxes for the wealthiest Americans and explode our deficit. Throughout the first year of Donald Trump’s presidency, Republican majorities in the House and Senate repeatedly tried and failed to repeal and replace the
Affordable Care Act—a move whose main effect would be to deprive tens of millions of nonwealthy Americans of reliable health care, which many enjoyed for the first time in their lives. By the fall of the first year, the president and his congressional allies feared that both their base and their donors might abandon them because of their lack of legislative accomplishment. As Senator Mike Lee put it, “We haven’t repealed Obamacare, so if we don’t get tax reform done, we are in trouble. We might as well flip up our tent and go home.” Representative Chris Collins (R-NY) explained, “My donors are basically saying, ‘Get it done or don’t ever call me again.’” Throughout President Trump’s first autumn in office, Republicans frantically patched together a tax plan that could pass by the narrowest partisan majority.
Ronald Reagan’s signature tax-reform legislation, enacted in 1986, had been a two-year effort that involved countless hearings in Washington and throughout the country and ultimately won broad bipartisan support. President Trump signed his tax plan only six weeks after its introduction in the House. Neither the Senate nor the House held a single hearing on the bill.22 Its final text of 2,232 pages appeared at 10:30 on the night the Senate voted.23
Favored lobbyists had full access to the Republican staffers drafting the bill. The American people—and most of their representatives—had none. Democratic senators got that one briefing at the Library of Congress, where the president read from his Asian itinerary. The result of this rushed and sloppy process was a bill that will exacerbate, not ameliorate, the terrible income inequality America faces. The secretary of the treasury, Steven Mnuchin, had pledged repeatedly that any new tax bill would not result in a net tax cut for the wealthy—a pledge that came to be known as the Mnuchin rule. As Mnuchin stated: “Any reductions we have in upper-income taxes will be offset by less deductions”—that is, people in upper-income brackets would be able to take fewer deductions, increasing their taxable income—“so there will be no absolute tax cut for the upper class. There will be a big tax cut for the middle class, but any tax cuts we have for the upper class will be offset by less deductions that pay for it.” This was a charade. There was no big tax cut for the middle class; the wealthy got most of the money.24 After President Trump signed the tax bill he told his well-heeled friends on his first night back in his gilded fortress at Mar-a-Lago: “You all just got a lot richer.”25
The drafters of the tax cut bill made no effort to pay for it. Instead, they claimed that the tax cuts would pay for themselves by generating economic growth—exactly the argument George W. Bush had made as he converted Bill Clinton’s $5.6 trillion projected surplus into a $1.2 trillion actual deficit. A more honest argument could be heard from Representative Mark Walker, Republican of North Carolina and at the time the chairman of the right-wing Republican Study Committee. He observed that concern about deficits is “a great talking point when you have an administration that’s Democrat led. It’s a little different now that Republicans have both houses and the administration.”
At the time, the most credible estimates (other than those from Washington politicians who should know better) projected that the tax package would add at least $1.4 trillion to our deficit. However, even those estimates understated the damage. The true cost of the tax cuts, according to the nonpartisan Committee for a Responsible Federal Budget, will likely be about $2.5 trillion over the first decade once budgeting gimmicks and interest costs are included. Combined with the spending laws President Trump has signed, the tax bill will create the largest deficit as a percentage of GDP that we’ve ever had outside periods of recession or war—a deficit brought to the country by a Republican House, a Republican Senate, and a Republican president. Unlike the deficit Barack Obama inherited at the depths of the Great Recession, this one has occurred at a moment when there is no good rationale; it is the very time we should be putting money aside for a future recession or conflict. Needless to say, and despite all evidence to the contrary, the Trump administration is already scheming to blame Democrats for his fiscal failure in advance of the 2020 election.
Those Tea Party ralliers in their tricorn hats seem awfully far away now, as do their original aims and impulses. But what the movement unwittingly brought about is staring us in the face.
VI. Shark Jaws
Sometimes, late at night, looking out the window at the well-tended and deceptively placid grounds of Lower Senate Park, I do some math. The exercise goes like this: what if, instead of blasting a hole in the budget, we had used that money for productive purposes? What could you do with that same sum of money? I’m not sure Steve Mnuchin and the president really need to pad their paychecks. But the rest of America could use some help.
Here are a few ideas for some onetime projects. We could have fixed our electricity infrastructure by investing in twenty-first-century generation, transmission, and distribution. That would have cost $177 billion. We could have repaired America’s aging dams. That would have cost $45 billion. We could have cleared the backlog for bridge rehabilitation nationwide, $123 billion. We could have cleared the backlog for airport infrastructure, $100 billion. We could have funded maintenance at our national parks and land-management agencies, $19 billion. We could have maintained our tech lead over China for ten years, $50 billion. We could have laid broadband to provide high-speed internet to every rural community in America, $40 billion. We could have cleared Colorado’s entire transportation-project backlog. That’s just $9 billion. We could have eliminated the national backlog for the Rural Water Program, $2 billion. We could have done all of that—and that’s just $565 billion.
So let’s be more ambitious. What if we look at what we could have done differently with the full $5 trillion worth of tax cuts enacted in this millennium—most of which went to the wealthy—and some portion of the $5.6 trillion we spent in the Middle East. What else could we have done? We could have provided larger tax cuts for the middle class. We could have raised the salaries of teachers in this country by 50 percent. We could have provided early childhood education for every child in America. We could have made Social Security solvent for all time. We could have paid down some of our debt, instead of handing it to our children.
But we didn’t do any of those things. Here is what we did instead: We failed to build significant infrastructure at historically low interest rates. We delayed our response to an opioid epidemic that takes more lives every year than automobile accidents. By governing with continuing resolutions, we even undermined our military preparedness. We have two thousand fewer air force pilots today than a decade ago because budget uncertainties have grounded training aircraft that have been scavenged for parts.26 For the first time since John Glenn orbited the earth, we can’t put an American into space on our own spacecraft; we need to ask the Russians for permission to ride on one of their rockets.
At the same time, we backed away to the outer limits of a democratic budget process and concentrated more power in Congress around its leaders. They in turn seized the opportunity and abandoned transparent legislative work in favor of self-serving showdown dramas. They replaced the daylight of a committee room with the closed doors of their offices. They turned their colleagues on the floor into hapless props who voted at the last minute according to the party line of the moment. And the more they emptied the process of meaningful debate and hard compromises, the more they enabled showboaters to transform what should be problem solving into campaign fund-raisers. With each repetition, Congress frittered away faith in the institutions of our republic.
All the while, we dug the country deeper into debt at the very moment when doing so made no sense. There’s a chart I keep in a binder on my desk. It shows a simple correlation—the correlation between rising deficits and the unemployment rate. The two lines mostly move together, as they should: the government spends more to help people and collects less tax revenue when the economy slows. But the big exception comes at the end—the period to which we give the name Now. The two lines have parted ways, opening up like shark jaws. The de
ficit is moving up. Unemployment is moving down. This is the opposite of good government. It is a threat.
Meanwhile, the only thing the roughly 90 percent of Americans on the wrong side of the growing gaps of wealth and opportunity witnessed was an increase in the divide between themselves and their wealthiest fellow citizens. Creating opportunity and revitalizing mobility are a job for all of us—teachers, entrepreneurs, parents, everyone; they’re not just a job for government. But government can make the task easier or harder. Thanks to the growing deficit, federal programs that make a real difference to poor and working-class Americans now precariously cling to existence. In late 2018, the majority leader, deigning to notice the deficit he helped to create, pointed the finger of blame at these very programs: they’re the problem. It is hard to imagine how business as usual will result in greater upward mobility, a stronger middle class, or a reduction of inequality.
To choose a different direction we will have to elevate our expectations of our elected officials’ real obligation to us. We will also have to expect of one another a more rigorous and productive engagement as citizens. We will have to call out our current politics for the con game that it is and replace it with something new. It is not enough to recognize fecklessness as a lost opportunity. We have to name it for what it is: a terrible theft from the next generation of Americans.
This is not, as we have come to believe, simply a fight between Democrats and Republicans. It is a fight between the future and the past.
VII. What Should We Do?
The American people are not prepared to accept that their children must settle for less. They are not prepared to accept that the rewards of a growing economy should accrue only to the wealthiest. There has been no growth in income for the poor and middle class in a generation, but Americans do not accept this as the new normal. Rather, the people I talk with at town halls express the view that Washington hasn’t made much of an effort to turn things around. While working people scrimp and scrape, Washington can’t even keep the government open long enough to have a civil conversation about what an effective economic strategy might be.
The Land of Flickering Lights Page 15