The 2012 political year is right around the corner and the recent failure by the so-called "Super Committee" to reach agreement on $1.2 trillion in deficit reduction will re-cast the environment on Capitol Hill and shape the 2012 campaign.
With divided control of Congress, and a 60-vote threshold in the U.S. Senate, major Congressional action before the 2012 election is now extremely unlikely.
Congress always seems to need a deadline to make the members focus on the country's business, and December promises to be a busy month. It's likely that members of Congress will do the following:
- Pass yet another temporary spending bill preventing a government shutdown on December 16.
- Extend the popular expiring tax provisions (payroll tax, research and development tax, etc.)
- Fix the alternative minimum tax and the reimbursement rates for Doctors in Medicare.
In recent years these actions have been taken each December before the end of the calendar (tax) year.
What has become clear this month, however, is that Congress cannot and will not take action on our trillion annual deficits, our $15 trillion debt or pass legislation that will markedly improve the economy.
Now, little more than 11 months from the 2012 election, the governing period has prematurely ended and the political season may begin in full swing, if it ever really ended after the 2010 election.
How will the Super Committee's failure to produce a result effect the 2012 election? Here are five ways the country will feel the impact of the committee's failure:
1. Congressional action is now effectively dead. Each year, Congress must do a few things to keep the country functioning. From now until the election next year, only the most mandatory business will be acted upon. That means action on expiring tax credits, temporary spending bills, nominations but little else. Capitol Hill will not be where the action is for the next year.
2. President Obama will blame Congress as he runs for reelection. Mr. Obama is facing a headwind in the form of a very weak economy and low job approval ratings. From a purely political perspective to run in 2012 he needed a villain. Now, the Obama campaign thinks they have one in the "dysfunctional Congress."
Had the Super Committee voted out a plan that was then passed by Congress, President Obama could have hailed the Committee's accomplishment as an achievement, but his campaign theme of running against the Congress would have been weakened. No matter. The Super Committee was designed to fail and the White House knew it. Now, they can try to blame Congress for the deficit and the debt.
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