The Congressional Budget Office has put out its analysis of the “financial cliff” – the label given to budget cuts and tax hikes that will take place if a deal on the budget is not reached – and the results are not pretty.
Simply put, it will put the US back into a recession at a time when growth is sorely needed. If this is not changed by January 1st, the CBO projects a 1.3 percent decline in the first six months of 2013.
Also known as “Taxmaggedon”, the plan is a combination of a repeal of the Bush Tax Cuts (or allowing them to expire) along with cuts to social programs and the military budget. The general idea was to agree to a series of budget cuts that would be so terrible as to force the two groups back to the negotiating table.
With the Democrats and Republicans as far apart as ever – and with looming major elections that promise to dramatically raise the rhetoric quotient – there are few who believe this will end well. Even the optimists seem to believe that we will have to wait until after the presidential election, at which time a lame duck session will need to work overtime to figure out some sort of agreement.
Meanwhile, Greece is having serious leadership issues of its own. After recent elections, there are two sides bickering about how to best lead the country out of a crisis that does not seem to have a proper answer. Whichever side gets its way, the ramifications for the global economy are massive. If the situation cannot be handled in a coherent and methodical way, the resulting financial crisis will be catastrophic. Even with a good plan, it’s going to be brutal.
The US and Greece both need plans that can only be implemented by a government that is working to solve the issues at hand. But a concerning trend is taking shape: Democracy just isn’t working that well.
Technically, we live in a Republic. And be damn thankful for that because history has plenty of examples of the types of atrocities that result from a direct or even representative democracy, with Sri Lanka serving as a particularly good cautionary tale.
But as a Republic we have some challenges. The point of a Republic is to make sure the majority, or any other large faction, cannot impose its unilateral will, particularly when it comes to other individuals. Since nobody is going to get their way, everyone has to work together to achieve common goals by figuring out a way to solve problems without hurting individuals or groups in the minority.
Democracy is an incredible thing, especially considering the advancement of technology and just how easy it is to exert force over another person. Compared to a time when a king would have to send horses with men equipped with swords to impose his will, the most powerful people in the world can essentially push a button that will send a drone to shoot a missile into whichever orifice seems least pleasant. That kind of power, one would think, would only make it easier to accrue and hold power. I am damn glad we live in a Democracy/Republic, and I wouldn’t have it any other way.
That being said, we need to start addressing and discussing what seem to be serious problems with the way things are being run. The most pressing problems now seem to be nigh unsolvable due to tremendous partisanship between the two major political parties. But instead of people demanding that their elected officials find common ground, each side seems to be digging their trenches deeper. Consider it a political arms race. As one side gets farther from the center, the other either has to hold its ground or move in the opposite direction.
And in a crisis like we have now, it only gets worse. With so much at stake in both countries (a major budgetary decision in the US and the arguments over austerity and leaving the euro in Greece) giving an inch might as well be a mile. It’s impossible to say just what will happen if these situations go unresolved. Dangerous ideas tend to percolate in these situations, just as they are in Greece right now.
Democracy is an incredible political institution, but it is being tested. If politicians cannot rise to meet the challenges, the questions that should be asked about our governments will get louder. Democracy is not a permanent fixture to be taken for granted. Democracies have risen and fallen throughout history. And when leaders are unable to fulfill their obligations, many more will begin asking questions about who picks our leaders, and how.
Image courtesy of Dave Hosford
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