Thursday, January 3, 2013
The “resolution” of the alleged Fiscal Cliff is a near textbook example of what U.S. diplomats would usually call a Banana Republic. Wikipedia’s definition: “Banana republic denotes a country which is ruled by a plutocracy (the wealthy) who exploit the national economy by means of a politico-economic oligarchy (small number of people).“ Six people just decided a multi-trillion deal – arguably making this a case study. In fact, however, the U.S. political system today reflects a Parliamentary system.
The U.S. Government was designed to be a republic – where elected leaders represent their constituents and power was specifically and evenly spread among the three branches of government. It’s big, it’s messy and it’s a pain in the ass to get nearly 600 people to agree to something. That’s the design and the structure we’ve lived with for 236 years and is, in the words of Winston Churchill: “Democracy is the worst form of government, except for all those other forms that have been tried from time to time."
For much of America’s history the tension between competing interests has worked well. The media and many legacy politicians have pined for a time when politicians argued during the day but had a drink together at night – and compromise was considered part of governing. You have heard the Tip O’Neil and Ronald Reagan stories, right?
What’s different in today’s Washington environment is not that compromise has eluded the process, but rather that dogma and party have risen in importance. In a Parliamentary system votes are by party. Imagine what a firestorm if one Democrat had voted against “ObamaCare.” President Obama would have been criticized for not being able to keep people “in line.” It’s now about party, not policy – and that’s fundamentally un-American…or fundamentally un-Democratic.
When a politician changes his or her position – the opposition documents the “flip flop” and it becomes a central theme of the next election. Yet the same media forces that condemn any ‘evolution’ on a policy issue as a betrayal bemoan the loss of civility and inability for government to come to a consensus.
Americans for 30+ years have been promised that they can receive entitlements such as unemployment, social security, disability and a whole range of other programs while not having to contribute significantly to the cost of those programs through low taxes. You can have your cake and eat it too. Since Reaganomics (described by President Bush 41 as “voodoo economics”) came on the landscape we have been able to have it all.
The same people who championed low taxes, a huge military and ample social programs that resulted in the current $16 trillion deficit are screaming that the emperor has no clothes. Well, he never did. But for 30+ years society has accepted that he did. President Obama recently said in frustration that in the 1980’s he’d be considered a moderate republican. He’s probably right.
The issue, however, isn’t partisan. It’s math. A stable economy – whether it’s a household account, a business, a non-profit or a government – simply cannot spend 30% more than it brings in and be sustained. This “fiscal cliff” resolution addresses less than 1% of the 30% overage. Until voters get serious about electing legislators who will balance the budget and pay off the debt we can continue to expect the U.S. to look more and more like a Banana Democracy.