The big news yesterday was that the "super committee" (the unofficial name given to the Joint Select Committee on Deficit Reduction) failed to arrive at an agreement to trim at least $1.5 trillion in deficit reduction over the next ten years - which is a pretty modest goal considering the total budget over the next 10 years is likely to exceed $40 trillion. The failure will lead to
For summaries of the process and what went wrong click here:
- NYT: The Plans for Reducing the Deficit.
- Click here for background from Times Topics.
- Supercommittee announces failure in effort to tame debt.
- Panel Fails to Reach Deal on Plan for Deficit Reduction.
And here are a handful of opinions about the consequences:
Roger Hickey of the Huffington Post is glad the super committee failed: "If the so-called "Super Committee" had made a bi-partisan deal based on
the announced negotiating positions of the Republicans and Democrats on
that panel, the result would have been higher unemployment, serious
damage to the social safety net -- and worsening deficits." The consequence would have been higher deficits over the next ten years due to a worse economy.
NYT commentators point out that the triggers put in place by the deal's failure - plus the increased likelihood that the Bush tax cuts will expire at the end of next year could lead to recession: "A Moody’s Analytics report warns that failing a deal, the combined
impact will amount to a “historically extreme” reduction in the deficit
that could push the economy into recession.
It notes that under current law, federal revenue would increase as a
share of economic activity by 3.7 percentage points over 2012 and 2013 —
the sharpest rise since 1969, when, Moody’s says, sudden tax increases
“helped set off a mild recession.” Combined with the required budget
cuts, the deficit would shrink to $510 billion from $1.3 trillion by
2013."
The Washington Post provides a guide to the rhetoric surrounding the debt debate.
The Christian Science Monitor provides a briefing page - what do you need to know about the committee's failure?
