End fiscal lunacy

By Peter Goldmark

Newsday

It takes a lot to get me really mad — but I am deeply angry at the lunacy I see in the halls of Congress on the subject of the deficit. We all should be, for the simple reason that the stakes are so high. The debate on the deficit is really about our economic future. We have a big course correction to make — and if the loonies in Congress screw it up, our children and grandchildren will pay dearly for generations to come.

Things are seriously out of kilter. We have more than 13 million unemployed and the stuttering recovery isn’t reaching them. The deficit is growing. And more than two years after the bubble of phony loans, phony books and deranged derivatives popped, neither the president nor either party in Congress has put forward a serious 3- to 5-year plan to get us back on course and avoid the economic train wreck waiting if we do nothing.

We need to do what America has always done in the past when in trouble.

We need to reach down for strong solutions, even if they’re very difficult. We debate them, pound the table and yell at each other a while — and then we hammer out a compromise and roll up our sleeves and implement it. That’s how America works its way out of trouble pragmatically and prospers.

That compromise solution should include steps to create jobs for the unemployed and low-income folks getting pummeled in this recession; restraints on the reckless cost escalation built into Medicare and Medicaid; slight adjustments in Social Security; and a modest tax on consumption to boost federal revenue and encourage people to save and invest rather than buy, spend and borrow.

These steps are hardly radical — and some are practically obvious.

Meaningless cuts

Indeed, they’re practically obvious. But is any such plan being put forward? No. Instead we have a new Republican majority in the House congratulating itself for passing a series of tiny, meaningless cuts in a small sector of the budget — cuts that won’t create any jobs or have any material impact on the deficit.

These same Republicans voted to repeal the health insurance program with its cost controls — one of the few programs that actually limits long-term spending. But they shy away from cutting $5 billion in tax subsidies to the oil companies. They savage family planning for the poor and take police off the street — but these chest-thumping budget-cutters don’t dare touch huge subsidies for some of the largest and wealthiest companies in the world. And what do these sacrosanct subsidies actually go for? Accelerating the annual flow of nearly half a trillion dollars for foreign oil, a gushing wound that bleeds our economy and endangers our security.

They won’t cut where the budget is growing most dangerously, in the health sector. Instead, the Republicans insisted on extending a needless tax cut for the wealthiest among us — which won’t help the unemployed and will make the deficit a lot worse for all.

Government shut down

Now some of them are talking about letting the entire government shut down. That’s like saying: “If you don’t do what we want, we’re going to shoot both you and ourselves in the head.” Shutting down the government in an argument about the debt ceiling would be like holding up a big sign to the rest of the world saying: “Don’t Count on Us.” In these turbulent times that is not a useful message to be sending one’s economic partners and creditors.

You can have the tea party. Its adherents don’t seem to have any answers to our problems, and they prefer senseless tirades to thinking and hard work. But if anyone starts a Sanity Party, I’m joining up.

Peter Goldmark, a former publisher of the International Herald Tribune, headed the climate program at the Environmental Defense Fund. He wrote this for Newsday.