It’s the politics, stupid
There is a growing school of economic thought that suggests the economy is healthier than many people understand, but political gridlock is an anchor dragging against economic recovery.
As the headline above suggests, James Carville’s famous slogan from Bill Clinton’s 1992 presidential campaign — “It’s the economy, stupid!” — may be turned around these days.
U.S. Treasury Secretary Timothy Geithner expressed the notion at a conference Tuesday.
“You have this terribly damaging political dysfunction here and in Europe that leaves the world wondering whether the political system has the capacity to do the right thing,” he said, according to CNBC.com. “That is very damaging to confidence.”
Lest you think Geithner is just covering for himself and the Obama administration, consider this statement by Monique Serra, with Alpine Trust & Asset Management in Grand Junction:
“The economy has clearly slowed; many believe it has as much or more to do with the dysfunctional political environment in Washington than it does with economic and investment fundamentals.”
Serra’s statement was written well before Geithner issued his similar pronouncement. Furthermore, it comes from an organization primarily interested in maximizing investors’ assets, not in ascribing political blame.
It’s hard to argue with either statement. People and businesses are clearly hesitant to make major financial moves because of uncertainty over what is going to happen in Washington.
So what’s to be done?
We’re certainly not advocating that Republicans immediately jump on the bandwagon to offer unquestioned support for all of President Barack Obama’s latest jobs plan, which is largely made up of rehashed ideas that the GOP has already rejected.
Nor do we expect Obama to abandon all his economic ideas and embrace the budget plan put forth by Republican Rep. Paul Ryan.
But politicians of both parties could do much to restore national and world confidence if they displayed some indication they are willing to move toward realistic compromises on budget issues.
Instead, most members on both sides hew unmovingly to their favorite positions: “No new taxes!” “Raise taxes on the rich!” “Cut spending!” “Spend more!”
Both sides seem to be far more interested in improving their chances for election victory next year than in seriously addressing economic issues right now.
That’s why the recommendations of President Barack Obama’s deficit reduction panel were simply ignored — by the president and all but a handful of people in Congress.
It’s why Republicans in the House passed an entirely symbolic resolution Wednesday expressing their disapproval with increasing the debt ceiling this week, even though they approved a plan this summer that authorized that very thing.
All of this should be of more than a little interest to residents of this community, which suffered a 3.3 percent drop in economic activity from 2009 to 2010, one of the worst declines in the country.
We need all politicians of both parties, including Third District Congressman Scott Tipton, to join the effort to find bipartisan solutions to our budget problems rather than simply lobbing rhetorical grenades from opposing sides of the political divide.
If they fail to do so, that political-dysfunction anchor will drag our economy further under water.