With all of the non-stop coverage of the Convention in Tampa this week, I probably don’t have a lot more analysis to add there. But I did want to bring your attention though, to one thing that did not receive as much attention.
On Monday, the Congressional Budget Office, which is the official, non-partisan number-crunching arm of Congress, released its regular report on the state of the economy and the federal government’s finances. The picture it painted was pretty bleak.
In short, recent economic activity has been weaker than previously anticipated. Growth continues to be anemic. The debt and deficit is worse and will remain so under current policies for years to come. And there is a good chance that the dysfunction in Washington could tip the country back into a severe recession.
More likely than not, you’ve heard me talk before about the “fiscal cliff” that is coming on January 1st. In case you haven’t, here is the quick rundown: the current tax rates for all Americans are about to shoot up. A whole host of deductions and other temporary provisions are set to with little warning. And on top of that, we’re looking at $500 billion in automatic spending cuts that will destroy hundreds of thousands of jobs in the military and in the factories that support them.
CBO, in their ever-sober tone, have made it clear that if nothing is done and this is allowed to happen, America will fall back into a deep recession in the first half of next year.
I don’t want to take up too much of your time going through the things we’ve already discussed in previous weeks, but I do want to remind you about how serious the situation is. The media has a pretty short attention span and they aren’t focusing on the things that are going to be very significant in the coming weeks and months. I’m not sure the rest of us really have that luxury. The “fiscal cliff” must be dealt with. It cannot be ignored just because it’s campaign season. The price of failure is just too high.
In closing, I just want to remind you that the House has passed legislation that would avert this crisis. We’ve done it months in advance. But the President has made it clear that he doesn’t want to deal with it until after the election. I, for one, am sick of the 11th hour, panicked, frantic, sloppy governing. The American people need to speak up on this. The situation is likely to get tougher before it gets better, but it doesn’t have to be that way. There is time to get this right. We just need both branches of government working together here.
That’s the bottom line. If you have any questions or suggestions that you think I should be aware of, please let me know. And in the meantime, I hope you and yours have a wonderful Labor Day Weekend.