Friday, August 12, 2011
Tom Block: Let games begin in Washington
as Congressional deficit committee works
By Tom Block
With the appointment of the 12 members of the House and Senate to serve on the new “super” Joint Committee on Deficit Reduction, I wanted to take a first attempt to speculate at what might happen as the Joint Committee gets down to work.
From my days as head of Government Relations for JP Morgan Chase I know several of the Committee’s members and know most from reputation. With the exception of John Kerry they might not be the most high profile members of Congress; however, as a group they are serious legislators who represent the core of their respective conferences. I am sure this was critical as the leaders made the assignment, as any agreement needs to be sold to the broad membership in order to approve a final agreement. I think it is positive that all the House Republican designees supported the debt ceiling bill, as that was a very tough vote for the Speaker to steer through the House and demonstrates their commitment to the leadership.
As the super joint committee begins its process, the framework of the debate has changed in recent years. There is a general consensus within the political leadership of the U.S. that action needs to be taken on deficit reduction. There may be a substantial difference in both the pace and direction of the deficit reduction; but there is little disagreement that deficit reduction is the right direction for public policy.
Probably no one factor symbolizes the changed public policy than earmarks. Prior to the 2010 elections no one item in the federal budget better highlighted the attitude most elected officials brought to their job. Every election cycle members of the House and Senate bragged about the money they had brought back to the district or state. Now by broad consensus earmarks are gone; and while support of local initiatives is still important, the days of pure pork are over. Each initiative must stand on its own merit and be approved or fail within the context of the regular budgeting process of government. While earmarks never amounted to a significant percentage of the federal budget, they were a great example of the system’s excess.
Now as the Joint Committee begins its work the big question is whether or not the combination of the S&P downgrade, major volatility in the equity markets, a weak economy with high employment, and a broad fear of an uncontrolled deficit can overcome the harsh partisan bickering that has dominated the political debate over the past two years. They don’t start from scratch; a lot of groundwork has been done. Bowles-Simpson Commission, Biden Group, Gang of 6 have all laid out good options, now the Joint Committee must accomplish what these groups and indeed the regular Congressional budget process has failed to do.
In future columns I will review different option, and monitor the progress of the Committee. It’s worth following, as the impact will have an enormous impact on everyone.
Tom Block is a public policy consultant who had a 21-year career with JP Morgan Chase where he served as head of government relations in D.C. and created a Washington research product. A native Kentuckian, he also created the bank’s EU Government Relations program and developed a new position as U.S. Government Policy Strategist focusing on how U.S. government policy impacts capital markets. He has an extensive government and banking background, has worked on political campaigns and as a speech writer. He is a trustee of Bernheim Aboretum in Louisville and holds a B.A. degree in political science from American University. He and his wife now make their home in Kentucky. He is a regular contributor to KyForward. Contact him at firstname.lastname@example.org.