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Saturday, January 29, 2011

THE STATE OF THE UNION: ALL HOPE; NO CHANGE

Many Americans waited expectantly for the latest version of "hope and change" in the President's State of the Union speech; "hope" for a common sense plan to "change" the path to fiscal ruin on which the nation currently finds itself. None was forthcoming. President Obama's talent for lofty inspiration and soaring rhetoric was a "no show", as were sound ideas and a tough and frank commitment to make the sacrifices necessary to deal with the financial crisis.

Instead, the President resorted to a list of "we have to's" and “we need to‘s“, without explaining "how to”. Generalizations, mostly including an expanded role for government such as "encouraging innovation" through government investment i.e. spending, in the bio-medical area, information technology, and "clean energy" were emphasized.
Apparently believing that citing a laundry list of long term "goals" would give hope to the millions of Americans currently struggling with unemployment or underemployment, Obama went on with such things as "one million electric vehicles by 2050" and assuring that "80% of U.S. electricity is from clean energy sources by 2035". If waiting 25 to 40 years for a new job in these newly invigorated industries failed to excite, then there was always; "hire 100 thousand new science and math teachers". How exactly this boost to education deals with the immediate problems or how bankrupt states and municipalities could pay for these new hires, went unstated.

The president seemed eerily detached from the magnitude of the nation's fiscal crisis. He failed to mention the relevant numbers. The current federal deficit just reached $1.5 trillion. The accumulated annual deficits, the federal debt, is $14.03 trillion and represents 96.5% of Gross Domestic Product (GDP), the value of all domestic goods and services on an annual basis. These are numbers only a cosmologist who deals in light years and the size of galaxies can fully understand. 14.03 trillion is 14.03 thousand billion and one billion is one thousand millions. Interest on this debt for 2010, which is currently held down by very low interest rates still amounted to $197 billion. The Congressional Budget Office has estimated the annual interest payments will increase to $800 billion by the year 2020 but that estimate is based on a projected debt of $16 trillion. With the current debt already at $14 trillion, the figure for 2020 is significantly low and the annual interest on the debt will grow much faster as the debt increases and interest rates rise.

What specific ideas did President Obama offer to address these problems? First, more spending: high speed rail that in 20 yrs. will be accessible by 80% of the American people. This effort has already been commenced by Democratic Senate Majority Leader Harry Reid who put a multi-million dollar grant for a high speed train between Disneyland and Las Vegas into the 800 billion dollar "stimulus fund". Then, the standard refrain about spending millions or billions on "infrastructure" i.e. roads, bridges, water projects etc. Obama's suggestions for reducing spending and thus reducing the deficit and federal debt carefully avoided anything discomforting or effective.

He proposed to "freeze government spending for five years which he claimed would save $400 billion over 10 years. He did not explain how freezing government spending at a level which exceeds government revenues by $1.5 trillion would achieve "savings". He might argue that a "freeze" is a cut because as the population and economy grow the need for expansion of government spending is inevitable. But even though his $400 billion over 10 years figure is pure conjecture, it represents only $40 billion a year which would be savings of only 1.1 percent of the current federal budget.

That was the extent of Obama's specific spending cut suggestions. The rest were generalizations without benefit of "how to" or "how much" in savings would result. He proposed a web site for government expenditures, presumably to expose wasteful spending and he promised to veto appropriations bills that contained "earmarks" or "pork". Other feel good suggestions without details included "simplifying the tax code, and "merging or consolidating" government agencies.

The theme of Obama's address was apparently the slogan "We do big things." But the message was Obama and the Democrats in Congress continue to rely on big government spending to do big government things.
The Republican response delivered by Congressman Paul Ryan , Chairman of the House Budget Committee was different in orientation only. Ryan criticized Obama's "spending spree" and warned of "catastrophic debt in the future" but he also avoided specific areas which would be targeted for cuts. Some Republicans in Congress want to go back to 2008 spending levels when the next budget is passed in the Spring. That figure was $2.9 trillion, or a reduction of $700 billion from current levels. While that is an impressive number on its face, the White House estimate of government receipts for 2011 is $2.567 trillion, thus if Republicans were successful in this reduction, it would still produce a deficit of $333 billion and thus increase the national debt by that much.

 The magnitude of the numbers alone suggest that deficits are years away from disappearing and the $14.03 trillion debt will essentially never be entirely reduced because that requires a budget surplus over many years. Based only on Obama's 2011 estimates, government tax receipts would have to grow by 33% and spending remain the same or spending would have to be cut by 33% to achieve even a balanced budget in fiscal 2011. The last budget surplus which occurred in 2000 was $236.4 billion and was the largest in modern history. If that surplus could be replicated each year, it would take 30 yrs. to reduce the debt by 50%. Of course, the budget does not need to be balanced in one year but it cannot be a long term project as each year it is in deficit, the federal debt grows.

So far, politicians prefer to talk about "slowing the growth" of the deficit and debt but that process must have a medium term end game of reaching budget surpluses or the government is on a path to virtual insolvency which would manifest itself in rapidly rising interest rates necessary to sell government bonds (sovereign debt) to finance expenditures. The rates would increase debt service which would be added to the debt in a never ending spiral of inflation that would filter through the economy as a whole.

Significant spending cuts requiring significant political courage are needed. All government spending benefits some group. Each group will argue that their need for government dollars is more important than others. Attempts to cut the budget will stimulate a deluge of lobbyist advocacy to save particular programs. But across the board spending cuts that are favored by some to avoid singling out specific programs and inviting the ire of their constituencies make little sense since not all agencies and programs have the same value to the nation. Faced with a continuing terrorist threat does it make sense to cut the FBI or Homeland Security Dept. the same percentage as the Dept. of Agriculture with its bloated and outdated agricultural subsidies programs? Is the National Endowment for the Arts as vital as the U.S. Coast Guard?

While it is the responsibility of the President to properly define this enormous problem and exercise the leadership necessary to convince the American public to accept the pain necessary to make progress, he appears to have made the decision not to jeopardize his reelection prospects by alienating any beneficiary of government spending and instead promote the fatuous idea that the economy, with aid of even more government spending, can "grow out of the recession", the chronic deficits and the astronomical federal debt.
As the numbers indicate, even large spending cuts are by themselves inadequate with respect to cutting the national debt and its budget destroying interest payments. Revenues must be significantly increased and that means tax hikes or new taxes. Simply "taxing the rich" will not be enough. The top 1% of income earners already pay 38% of all federal income taxes and the top 10% pay 70% (2008 figures) while almost 49% of American households pay no income tax at all. Ultimately a federal sales tax of some kind will probably be needed. In the mean time narrow minded ideological partisans on both sides will demagogue the issues and seek political advantage by pandering to their constituencies and interest groups. While it is difficult to convince citizens who are already under financial stress that it is important to accept more economic hardship now to prevent a future worse hardship, the problem won't go away and each day's delay makes problem worse.

Monday, January 24, 2011

THE CHINA SYNDROME

The 1979 movie of the same title referred to the scientifically challenged case in which a "meltdown" at an American nuclear power plant would cause super hot nuclear material to melt its way through the entire earth and pop out the other side, presumably somewhere in China. If one chooses to engage in such metaphors, today they would more appropriately be labeled the "America syndrome" since development of nuclear energy in the U.S. has been on hold for generations while China has 27 nuclear power plants in the planning/construction stages. But the larger point is that the Chinese nuclear program is demonstrative of the remarkable industrial and economic changes in China largely coming since the major shift in ideological direction instituted by Deng Xiaoping in the late 1970s.

These changes and the developmental progress that have resulted were highlighted by the recent visit of Chinese President Hu Jintao . Much "analysis" of the state of U.S./Chinese relations and the proper direction of that relationship for the future has been dominating the media as a result. The commentary has ranged from common sense to exaggerated, ideological and impractical. A few facts to establish context are always valuable.

1. Trade:
The leading point of contention in U.S./Chinese relations currently is economic in nature. China is America's second largest trading partner (after Canada). Total bilateral trade was $$415.9 billion in 2010. The problem is the U.S. trade deficit which is enormous ($252.38 billion in 2010) and growing and which American government officials blame on China's unwillingness to let the value of their currency "float" according to market forces. By holding the value artificially low as a matter of government policy, the Chinese ensure that their exports will be artificially cheap, making the costs of similar domestically produced goods in importing countries like the U.S., relatively expensive and thus non-competitive. The sheer volume of Chinese products entering the U.S. has resulted in the Chinese holding over 800 billion U.S. dollars which they then invest back in the U.S., mostly in U.S. government securities. China has also created other barriers to free trade such as domestic government subsidies to Chinese manufacturers, restrictions on government purchases to Chinese products, and restrictive licensing and bureaucratic red tape to discourage imports.

Some progress in dealing with these issues was announced by President Obama and President HU during Hu's visit. A major sale of civilian aircraft by U.S. based Boeing Corp., which had been in negotiations for several years, and some concessions regarding Chinese government purchases were accomplished. However, the undervaluation of the Chinese currency remains the major issue and the trade relationship of the world's two largest economies clearly should be the focus for the future.

2. National security and the dramatic increase in Chinese military budgets and capabilities:

The Chinese military is engaged in a modernization program in all of its services. A new stealth fighter was recently tested, a new anti-ship ballistic missile has been reported and a continuing effort to expand Chinese sea power has extended the reach of the Chinese military into the early stages of a global player. The level of threat to U.S. security interests this portends is however still not clear. Some analysts see it as a direct threat that requires both a continued technological and a strategic policy response. However, Chinese efforts to exercise influence backed by implied military threats due to increased capabilities have been both limited and regional, mostly specifically focused on disputes with Japan, the Philippines and Viet Nam over small islands with potential energy based economic benefits, but no inherent geographical importance. China's military expansion and modernization cannot be ignored but the prospects for direct confrontation with the U.S. are remote in the light of the economic relationship mentioned above.

3. Human rights:
Much was made over this issue during President Hu's visit. He was lectured by Speaker of the House Boehner, President Obama, members of Congress and the press. This is pro forma in almost any high level government contact with Chinese officials. The reality is that China is not a democracy and Chinese officials have a long history of intransigence when pressed on this issue which they consider an interference in domestic affairs; an issue of national sovereignty. Most experienced American officials realize the lack of influence they will have but feel it necessary to play to the international human rights community. Media critics found fault with the 2009 Nobel Peace Prize recipient (Obama) entertaining the president of a country which currently holds the latest Nobel Peace Prize winner Liu Xiaobo, in prison. While Liu is to be admired for his courage in taking a public stand for political reform and human rights in China, his resume' is a bit thin (he wrote a book entitled "Charter '08 with this theme) for the Nobel Peace Prize and he appears to have been the recipient more for his suffering, an eleven year prison sentence handed down in 2009, than for his achievements. This is compatible however with the diminished standards used in the 2009 award. Obama had no visible achievements in the area of "peace" and his suffering was not to begin until the mid-term congressional elections of 2010. The larger point is that China is important and a cooperative relationship with the U.S. is essential. There is no denying that the Chinese government uses harsh methods to repress individual liberty but that does not diminish in any way the necessity for the building of a constructive relationship with the U.S. as we have with other quasi- democratic or authoritarian nations i.e. Pakistan, Saudi Arabia, and Russia. Chinese leaders have concentrated on economic development and have deferred political liberalization in the face of daunting problems; a population of 1.33 billion which includes thirteen major ethnic groups, many of whom speak different languages and several hundred million rural poor. As President Hu stated, "China is a developing country." The political leadership has observed the difficult transition to democracy in Russia, the failed efforts at premature democracy in Iraq and Afghanistan and the long history of political chaos in post-colonial Africa.  All these areas had no democratic tradition or cultural foundation for such. Thus those Chinese leaders inclined towards political liberaliztion have concluded that economic development, infrastructure and literacy should come first.

4. International cooperation:
China is on the cusp of super power status. It is the third largest country in the world; it now has the world's second largest economy and with its huge population might well become the largest in just a few decades. China is also a nuclear weapons state and holds a permanent seat on the UN Security Council. Chinese foreign policy intersects with U.S. foreign policy in several important areas and their future cooperation in these areas is vital.

China is the nation with the most leverage on North Korea an erratic regime prone to crisis making on the Korean peninsula and engaged in world wide conventional, and possibly nuclear, weapons proliferation. China has a financial/energy commercial relationship with Iran and has so far blocked the passage of strong economic sanctions in the UN Security Council on that country to pressure them to give up their own nuclear weapons ambition.

Thus the relationship with China may well be the most important for the U.S. for the foreseeable future. It will take skilled diplomacy and acceptance of real world conditions to manage this relationship. The visit by President Hu, despite all it's pomp and ceremony was a necessary part of the process.
 

Monday, January 17, 2011

WAITING FOR THE FIRST ACT TO BEGIN

The nation is waiting; some patiently, some in frustration, while the media subjects us to never ending analysis of the Tucson shooter's demented mind and seeks political explanations for his amoral act. The wait is today compounded by the annual blizzard of platitudes that this same media and its commentators, as well as politicians of all stripes, feel is necessary to explain why the message of Martin Luther King Jr. has "still not been fulfilled". Again, the political component of these messages is hard to conceal.

But wait we must until the 112th Congress finally gets to work. Even then, when the gavels fall and the sessions begin in earnest, pro forma political posturing is first on the agenda. The new Republican majority in the House will stage a debate and a vote, entirely symbolic, to repeal the Obama/Pelosi/Reid health care reform bill passed in the previous Democrat controlled congress. While public support for such a repeal is strong and even some Democrats like Charles Schumer (D-NY) agree that some revisions are appropriate, the Democrat majority in the Senate and the Democrat in the White House make passage of actual repeal an obvious impossibility, but the new Republican House majority must make its statement.

Then there is the issue of increasing the legal debt limit for the nation. Republicans, especially newly elected representatives associated with the Tea Party movement are vowing to oppose such an increase. Some seem to actually believe that is a viable position. Whether that position is based on ignorance of the international financial system and basic macro-economics or simple ideological intransigence, it will, in the end, be rejected by wiser Republican leaders in the Congress. While opposition may to some Republicans, be just a negotiating strategy to gain a commitment from Democrats to make large spending cuts, few members of Congress of either party believe that the debt limit, which has already been reached, cannot be increased without severe damage to the economy, so it will be increased. The time to limit further increases after this is now, not when the new limit has been reached. So the nation will continue to wait for details and legislative action on significant spending cuts and yes, "revenue enhancement" a.k.a. tax increases. Republicans, especially the Tea Party wing will dig in their heels in opposition to any tax increases but the long term solution to the stratospheric annual deficits and the $14 trillion plus federal debt simply cannot be found without a combination of the two. Tax "adjustments", "reform" or whatever euphemisms that will be applied, may have to wait until after the 2012 elections but their simply is not enough spending on the discretionary side of the budget to make cuts the sole remedy.

All these efforts are complicated by the Left-Right, Conservative-Liberal, divide in the country and the Congress as well as the internal divisions in the Republican Party in Congress as it struggles to define itself. It should be easy or at least intellectually comforting to be a political "conservative" today. Conservatives are buoyed by the success of the Republican party in the November, 2010 mid-term congressional elections and the dungeon level approval ratings of liberal Democrat leaders in the Congress. Republicans in Congress have specific, although broadly defined, public policy goals. Liberals, self styled "progressives" and other elements of the Left are in disarray and are fighting amongst themselves over who is liberal enough and what strategies should be followed to bring about a "progressive" resurgence.

Still, the conservative political side of the electorate is divided and is exhibiting flaws that describe a potential vulnerability and all too often an embarrassing nuttiness. The basic precepts of conservative philosophy are clear and easy to comprehend and defend: maximize individual liberty within a context of basic social responsibility as opposed to liberalism's philosophy of maximizing social collectivism at the expense of individual liberty and the dominance of government; ensure that government remains the servant and not the master of the people which means clear lines of transparency and accountability. This manifests itself in terms of limiting the regulatory structure and powers of the government. It also inevitably must address the size of government and the taxing authority that govt. uses to sustain its bureaucratic reach.

Conservatives believe that the first responsibility of government is to provide for the physical and economic security of those it governs, thus a conservative government would emphasize national interests over certain concepts of internationalism which come into conflict with national interests. In keeping with the emphasis on individual liberty, conservatives support a free market economy, including its flaws, as the best system available for economic growth, social mobility and high standards of living.

These few, clear concepts should need little defense, especially in the context of the economic and social meltdowns in the more advanced welfare states of Western Europe, the historically rapid acceptance of free market conversion in the socialist states of Russia, China and Vietnam and the four decade old collapse of the socialist experiment in Cuba. But political/economic conservatism in the American context is different. The prominent voices of U.S. conservatism contain elements of extremism, ignorance and intolerance that offer easy targets for the liberal opposition. The significant "independent" voting constituency, which currently stands at 38%, exceeding both the liberal Democrats and the conservative Republicans, while itself conservative leaning in principle, is seeking practical, common sense solutions to the nation's problems, not heavily ideological prescriptions which have an aura of intolerance, self-righteousness, and disdain for all opposing thought, that is also commonly exhibited by the far Left.

Simply put, who should be the face of conservatism in America? Fortunately, the most intolerant and self-righteous voices of the politically organized "religious right" seem to have diminished in the public arena but the question remains. Should it be the array of talk show hosts, who by definition lack any kind of accountability except ratings, which seem to have a positive correlation to the level of inflammatory rhetoric spewed forth by the hosts? This phenomenon is indicative of the entertainment factor in political punditry and falls into the category of those hockey fans who go to the games more for the fights than the athletic prowess of the players. Political pundits like Rush Limbaugh, Michelle Malkin, Ann Coulter, Sean Hannity, Glen Beck and of course the simple minded slogan queen herself, Sarah Palin, have to preserve ratings and readers by adopting uncompromising and often simplistic or even factually inaccurate and hostile approaches to political issues.

To be sure, the Left has its own entertainers and provocateurs in Keith Oberlmann, Rachel Maddow, Ed Schultz, and columnists like Frank Rich, and the permanently hand wringing Bob Herbert, who can't seem to comprehend that the American public has actually rejected their collectivist philosophy. But conservatives seem to take the role of their media interlocutors more seriously than do the liberals. The result is a more extreme and less informed conservative electorate that is a captive to slogans and name calling.

Conservatives, who don't accept the lowest common denominator posturing of the Limbaugh-Palin nexus, are branded "Republicans in name only" or "RINOs" but conservatives and conservative leaning Independents do not need to be Republicans to be "conservatives" if the party is going to allow itself to be defined by these "pay for my thoughts" pundits.

So the nation must wait. Wait for the Republican Party to define itself; wait for a sensible agenda to be offered in the Congress; wait for a credible effort to sell that agenda to the voters and maybe, wait for 2012.
 
 
 

Tuesday, January 11, 2011

PAKISTAN: ANOTHER FAILED EFFORT?

 
While timetables are debated about the inevitable withdrawal from Afghanistan, Pakistan, America's "ally" in the fight against international terrorism is sliding evermore deeply into the same world of religious extremism that characterizes the medieval culture of Al-Qaida and it's protector, the Taliban. Simply put, the Afghan Taliban cannot be defeated as long as they have safe havens along the border in the Pakistani province of Northern Waziristan. The problem is compounded by the existence of the Pakistani Taliban, protectors of their Afghan brethren and threat to the survival of the existing Pakistani government.

Pakistan is a Gordian knot of contradictions and conflicts. It's geographical position next to Afghanistan makes its cooperation essential for the prosecution of the U.S./NATO war against the Afghan Taliban. As a possessor of nuclear weapons, stability in Pakistan is vital to regional security. The decades old conflict with neighboring India over the Muslim majority province of Kashmir keeps significant numbers of Pakistani troops on the southern border, away from the effort to deal with the insurgents in Waziristan, as well as creating a perpetual flashpoint with nuclear armed India.

Pakistan's government had to retreat from its recent position on the domestic matter of cuts in fuel subsidies which would have raised gasoline prices but been an important step in aiding Pakistan's struggling economy. Pakistan has a parliamentary form of government and currently relies on the twenty five votes of the Muttahida Qaumi Movement to maintain the government coalition. Meanwhile, the country is in the midst of religious turmoil. A regional governor who was an outspoken critic of Pakistan's blasphemy laws has been assassinated and a street protest in Karachi, Pakistan's largest city by 50,000 supporters of the oppressive laws which carry capital punishment as a possible outcome, has forced the government to declare its continued support for the laws. The laws are important for what they say about Pakistani culture, the ability and willingness of the military to mount a successful campaign against fundamentalist insurgents, the future of U.S. military operations and "nation building" in Afghanistan and the possibility of a fundamentalist theocratic regime coming to power in Pakistan.

Between 2002 and 2010 the U.S. has spent $17.82 billion in Pakistan in the form of economic and military aid. Yet, the Pakistani military has had a separate agenda which has included support for the Pakistani Taliban, the support for Pakistani Kashmiri terrorists by the military intelligence agency the ISI, and infiltration of the army itself by religious zealots, who oppose the fundamental precepts of democratic institutions. Governor Taseer was assassinated by one of his own specially trained military security guards even though it has been reported that the assassin made his plans known to the unit prior to the killing. The assassin was declared a "hero" by the street mobs in Karachi.

The bottom line is that Pakistan is another "tiger" whose tail the U.S. has grasped for decades but which is now slipping slowly free. If U.S. and the few remaining NATO forces are to leave Afghanistan by 2014, the Taliban and Al-Qaida leadership in Waziristan can't be left intact. Even if the Pakistani army agrees to cooperate in significant operations against these groups, the ethnic divisions, Muslim extremists and inability of Pakistani governments to actually govern effectively makes Pakistan look more and more like the chaotic situation in Iraq except that Pakistan has nuclear weapons.

In terms of broad U.S.  foreign policy goals, Pakistan, Afghanistan and Iraq offer the same lesson. "Nation building" is a liberal fantasy. The idea that all oppressed cultures crave democracy and thus it can be imposed by outside force, is a neo-conservative fantasy. Money alone cannot transform nations. The political culture of nations can only be changed slowly by the willing participation of the inhabitants. Religious extremism and tribal divisions defy Western concepts of compromise and "the loyal opposition". U.S. foreign policy should be oriented to restoring and maintaining order, assisting willing governments in efforts to liberalize their political cultures but accepting the reality of the need for strong central authority when nothing else works.

Wednesday, January 5, 2011

A NEW CONTRIBUTING VOICE

From the weeds:

Now that a new Congress has reported for duty, those of us who live out in the weeds, i.e., outside the major metropolitan areas, have taken a deep breath. How long we have to hold it remains to be seen. We're waiting to see if the new Congress has the cajones to start repairing our broken government in spite of the extremists who were, in many cases, responsible for their election. But while we're holding our breaths we're smiling. Watching Nancy Pelosi today step down from her position in line for the Presidency should have made every patriotic American smile. And while I'm not a big fan of Boehmer, he seems to be politically astute enough to recognize his responsibilities to us, the voters.
I guess I should use the State Department's terminology: I'm “cautiously optimistic” that our new bozos in D.C. can earn their pay. But, nah.... I'm not even cautiously optimistic. The party of Pelosi is unlikely to change overnight. The GOP, which was virtually hijacked by the religious right a few years back, is equally unlikely to change. That leaves us with those newly elected Congressmen who claim affiliation with the Tea Party. It's not hard to find large degree of naivete among those folks. Anyone who watched as the recent elections unfolded was astounded by the likes of Christine O'Donnell and Sharron Angle, and it's equally disheartening to hear a new Tea Party member talk stridently about drastically cutting government spending. No one wants to touch the third rail. No one will admit we need more revenue to close the deficit. Any proposal for increased government revenue will impact someone's rice bowl. 
It's all "rice bowl" politics. No one seems to care about the health of the nation, only about what can government do for me. It's accountability, folks, from start to finish. I suspect we're no better off with the new bozos than we were with the old ones. Sad.


From the weeds:
It's a feeding frenzy. It didn't take long. The Navy relieved one of its carrier skippers from his command. The reason? Stupidity. Captain Honors felt obligated to entertain the crew two years ago, and now his stupidity has come back to bite him on the a**. The feeding frenzy has now begun. The media want to know how he got away with this newly revealed stupidity for so long. Who was his CO when he shot himself in the foot? Where is said skipper now? Is he still on active duty? Is the still a captain? Has he been promoted to Flag rank? The media want to know. They think it'll help sell toothpaste. The rest of us.... well, we really don't give a rat's patootie.

THE 112th CONGRESS: TWO YEARS OF DIVIDED GOVERNMENT

The 112th Congress was convened on January 5, 2011. It has been the subject of a landslide of analysis and predictions but few details about specific public policies have emerged. The most common prediction is simply "gridlock" with the Republican controlled House facing off against the Democrat controlled Senate and the Democrat in the White House. But the nation can't simply go on "hold" for two years and most of the "analysis" has focused on the probable conservative activist agenda likely to be forthcoming in the House. The Democrat Senate appears to have abandoned a legislative agenda of its own and seems to be digging in with a bunker mentality to resist whatever comes out of the House.

So what is likely to be offered by the new Speaker John Boehner (R-OH) in the coming months?

First, political theatre. In the 2010, mid-term elections, Republicans ran against the Obama Administration's huge health care reform act and now they have promised to repeal it. They have the public's support on this issue with 60% opposed to the reform that has started implementation but whose most onerous provisions are not due until 2014. But the Democrats ignored public opinion when they passed the legislation in the first place and the Senate and President will not allow its repeal. Thus the Republicans in the House are simply making a political statement to the public with their upcoming repeal vote. Once that has been done, Republicans can delay or decline funding for various parts of the reform bill as they come up in future budget proposals but they had better choose carefully, since the early provisions now in place have a wider appeal than the so called future mandate requiring all citizens to buy health insurance.

Next on the Republican agenda is an effort to reduce federal spending on the 40% of the budget that is "discretionary" i.e. not part of automatic entitlements like Social Security, Medicare and Medicaid. Early proposals by Republican House leaders include reducing federal discretionary spending to 2008 levels, which would amount, in some estimates, to about a 20% reduction. But that's the easy part. Where these cuts would come from are the hard part and have yet to be described. Whatever the nature of the cuts, they are sure to incur a significant backlash, as individuals and groups that are affected abandon their general desire for budgetary responsibility and make the case that someone else's programs should be cut. Looming in the background is the reality that while significant budget cuts are necessary to lower towering budget deficits and address the 14 trillion dollar federal debt, these cuts simply won't be big enough and somewhere, sometime in the near future, tax revenues will have to be increased if the fiscal health of the country is to be restored. Currently, the country and the Congress are mutually tax averse, as was demonstrated in the "lame duck" session which extended the Bush era tax cuts based on the theory that they would act as an economic stimulus. Whether true or not, raising everyone's taxes during the current recession is politically unfeasible.

Another symbolic issue is raising the national debt limit. It is symbolic because it simply cannot be refused. Still, there are conservative Republicans in the Congress, mostly those with Tea Party affiliations, that are making political statements about this issue. Congresswoman and Tea Party doyenne Michelle Bachmann (R-MI) seems to be leading the charge to refuse to increase the limit. This is typical of Bachmann's inability to process reality. The federal debt grows by itself as the interest on the debt accumulates and is added back onto the principle. The federal government relies on the issuance of government securities to operate. These securities are believed by purchasers here and abroad, to be the safest debt obligations in the world. They are backed by "the full faith and credit of the U.S. government." While unfortunate, and unpalatable, raising the legal debt limit is not a choice. Failure to do so would tell the world that the U.S. no longer stands behind it's sovereign debt and essentially is in default. This would be an unprecedented financial disaster with global implications. It is ridiculous to even pretend that such an outcome is possible. Fortunately the more capable and qualified members of the Republican Congressional leadership understand this and Bachmann and her Palinesque simple-mindedness will only be taken seriously by the media in their on going search for controversy.

Health care and fiscal responsibility are important issues but the Congress is capable of doing more than two things at the same time and other important issues need to be put on the agenda in spite of the political divisions that make them difficult. Immigration reform is vital yet seems to have fallen off the political radar screen, perhaps because neither side feels that their version can be approved. But the country can't wait. Border states are suffering from crime and violence, public services are being overwhelmed, and cultural divisions are tearing communities apart. The compromises necessary for "comprehensive" immigration reform are obvious, but hyper partisan divisions led by advocacy groups on both sides make compromise politically difficult, if not impossible without a major discovery of political courage and leadership on the part of legislators.

The conservatives oppose any plan that the far Left proposes which contains "a path to citizenship" for the 11-14 million immigrants who are currently in the country illegally. The Left opposes any plan that includes strict border enforcement without such a citizenship remedy. A compromise is possible. It would include immediate border enforcement, with penalties for second offenders. Instead of a "path to citizenship" which opponents call an "amnesty" which would just encourage further illegal immigration, a permanent guest worker status with proper identification could be created. This would allow the current illegal residents to stay but would deny them the rights of citizenship i.e. voting, social services etc. Those individuals who want to seek citizenship would have to apply through normal channels and procedures. Such an arrangement is not a perfect solution but one does not exist. Border control combined with new and tougher penalties for employers who hire new illegal workers would mitigate the worst effects of the problem. However, both anti-immigrant and pro-immigrant advocacy groups would oppose such a solution. Unless and until one political party or the other gains control of both houses of Congress and the presidency in 2012, the nation is likely to languish with the currently out of control immigration situation.

The previously introduced "climate bill" known as Cap and Trade, which was essentially a tax bill designed to reduce climate emissions by penalizing industries based on computations of the volume of pollutants released during production, is dead. Alternative legislation to deal with the environment is possible but has yet to be proposed and skepticism by the public on the actual threat posed by global warming is growing, and attention is centered on job growth and federal spending.

The complicated and contradictory federal tax code needs to be reformed and there may be enough bipartisan support for a simpler, fairer code to be constructed. This should be part of the overall effort to reduce federal deficits and debt.

Still, prospects are not good that much beyond fiscal matters for which the House has a predominate role, will be accomplished. Partisan and ideological animosity is at an extraordinarily high level, as recent quixotic criticism of President Obama by the far Left for not being "liberal enough", demonstrates. The actual positions and influence of the new Tea Party members remain to be seen. Hopefully, the ideological purity that the Left requires will not be replicated on the Right.