Another Great Morning in the Nation’s Capital

I woke up to the headlines in today’s Washington Post – House Majority Leader Eric Cantor and Senate Minority Whip Jon Kyl were walking out of the budget negotiations. The Democrats, they said, were insisting that revenue increases be part of any agreement. No revenue increases were acceptable – period. Not even the closing of loopholes that few could defend with a straight face would pass muster. As the Post editorial writers noted this morning, Tom Coburn and other Senate Republicans may think it is OK to cut ethanol subsidies, but because that is scored as a revenue increase, it will never be acceptable to the House majority.

I ate a healthy breakfast in my comfortable air-conditioned house and stepped into the air-conditioned car in my garage to head for the DC Metro. As I drove into a nearby suburb to catch the subway, I noticed all the traffic lights were out. Today we have another power failure, affecting who knows how many homes and businesses. It will just be a blip on the evening news. The drivers adjusted, treating the nonfunctioning traffic signals as four way stop signs, and I soon arrived at the Metro. Today, the trains on the line I take were running on schedule. But at my downtown station, one of the deepest in the system, none of the escalators were working. We trudged quietly and uncomplainingly up the steps in the heat and humidity. And metro escalator failures are such a common event, I doubt it will get any news coverage.

But we are told we don’t need to spend more on these or other public services or public and private infrastructure. In fact, if they are in the public sector, we should cut them. And no one should have to pay higher taxes – especially those with the highest incomes who may rely less on public services or the social safety net. The worst thing we can do is to enact “job-killing” tax increases. If we have 9 percent unemployment following a decade of tax cutting, imagine how bad it would be if we reversed course. Instead, we are told, we need deep and immediate spending cuts, although advocates of these cuts sometimes forget that people who work on publicly funded projects also have jobs.

You may think I just woke up in a bad mood today. But that would be wrong. I woke up in a good mood. After all, it’s Friday. It was the series of breakdowns – none an extraordinary event – in the first hour of the day that soured my outlook.

We do face a serious long-term budget problem going forward. And both spending cuts and revenue increases will need to be part of the solution. I hope our leaders can find sensible ways to pare spending that maintain key infrastructure and protect our most vulnerable citizens. And I hope they find ways to raise revenue that eliminate outmoded preferences, spread the burden fairly among those with different incomes, and minimize economic harm. But sometimes, I confess, I am not very optimistic that any of this is about to happen and today is one of those days.