The Great Debate

Capitol Building in Washington, February 27, 2013. REUTERS/Jason Reed

Sequestration grew out of a political impasse: Republicans refused to raise the government’s borrowing limit in 2011 without starting to bring spending under control, but Democrats refused to make choices about where to cut spending.

So the president devised sequestration, on the theory that cutting spending in such a painful and dumb way would force Republicans to raise taxes. Spending on entitlement programs like Social Security and Medicare was mostly spared, but other programs, particularly defense, got across-the-board cuts.

As a result, thousands of federal workers, including border security and FBI agents, are being told to expect unpaid furloughs in the coming weeks and months. And that is only the beginning. If there is one thing Democrats and Republicans in Washington can now agree on, it is this: The sequester must be replaced.

Congress has taken bipartisan action to fix small pieces of it. To avert flight delays, we transferred Federal Aviation Administration funds to keep air-traffic controllers working and flight towers open. When the Food Safety and Inspection Service announced it was planning to furlough essential employees required to be on-site for meatpacking and other food production businesses to operate, I led the effort on the Senate floor to keep those critical personnel working.

These examples highlight the sequester’s arbitrary and destructive effects, but they also demonstrate Congress’s ability to come up with common-sense solutions. The question is whether Congress will show the same resolve to legislate a smarter approach to budgeting in general.

Five years into the global financial crisis, the U.S. and global economies remain mired in a weak-growth, low-inflation, high-unemployment environment. Debt busts such as 2008-09 are hard to exit from, and recoveries are long and painful. However, three complicating factors make the current environment even more challenging.

First, economic growth models lie broken across developed and emerging economies alike, with the United States deleveraging from its debt-fueled consumption excesses, the European Union locked in a fiscal and currency straitjacket and China (and emerging economies more broadly) transitioning from export-led to domestic-demand-led growth. Second, globalization is in retreat as financial institutions retrench. And third, debt levels remain highly elevated in the developed economies, leading policymakers to rely almost exclusively on monetary policy to buffer the necessary deleveraging process.

The current policy mix of easy money and tight fiscal conditions, however, produces the worst of both worlds: stagnant global growth and increased risk of financial asset bubbles alongside rising prospects for beggar-thy-neighbor tendencies (already somewhat evident in global currency markets).

A woman walking near the headquarters (L) of the Federal Security Service, in central Moscow, May 14, 2013. REUTERS/Maxim Shemetov

In Moscow, they are “non-Soviet Russians.” In New Delhi, they are a “political Goliath” that may soon awake. In Beijing and São Paolo, they are lawyers and other professionals who complain about glacial government bureaucracies and endemic graft.

Prosperity is spreading in many emerging market nations, but political change is not.

A man at a site recently hit by what activists said was a Scud missile in Aleppo’s Ard al-Hamra neighborhood, February 23, 2013. REUTERS/Muzaffar Salman

Most of the international debate about Syria policy focuses on how to remove President Bashar al-Assad from power.

Options for NATO states and key Arab League partners include everything from enlisting Russia’s help in a diplomatic approach, with a conference now envisioned for early June, to arming the rebels to perhaps even supporting them with limited amounts of airpower. Removing Assad, however, would no more end the Syrian conflict than overthrowing Saddam Hussein in 2003 brought stability to Iraq. The United States must create a more integrated overall strategy.

French President Francois Hollande’s predicament is, oddly enough, akin to one Alice faced in Lewis Carroll’s 19th century classic.

A year after taking power, Hollande is buffeted by the lowest popularity of any modern Gallic leader, a record number of jobless, a recession and shriveled business investment – while still needing to cut his budget deficit to hit European targets.

The protagonist of Alice in Wonderland, meanwhile, confused by her strange encounters down a rabbit hole, meets the Queen of Hearts, who tells her: “My dear, here we must run as fast as we can, just to stay in place. And if you wish to go anywhere, you must run twice as fast as that.”

This essay is adapted from the author’s new book “Balance: The Economics of Great Powers from Ancient Rome to Modern America.”

Hard power. Soft power. Smart Power. Superpower. This is the language of foreign affairs, full of meaning but empty of measurement. Vagueness is, of course, purposeful in the hands of skilled diplomats and politicians, but it can signal shallowness, ignorance or worse. Lacking clear metrics for power, the U.S. national security establishment speculates about possible rivals while being led astray by trendy catchphrases.

The “emerging foreign power” is a rotating special guest in the narrative of the American century. That role was taken by the Soviet Union during the Cold War, was filled by Japan for a decade and now stars China. Yet Beijing does not threaten to counterbalance U.S. power as gravely as America’s economy threatens to become unbalanced on its own.

We are witnessing the slow death of public opinion in this country.  It’s being displaced by party opinion.

These days, more and more Americans are inclined to judge issues from a partisan viewpoint.  In March, according to a Pew Research Center survey, twice as many Republicans (53 percent) as Democrats (27 percent) said the economy was poor.  Yet, from everything we know, Republicans are not suffering more economic deprivation than Democrats.

Elections today are less and less about persuasion and more and more about mobilization: You rally your supporters in order to beat back your opponents.  Republicans did that in 2004, when President George W. Bush got re-elected with 51 percent of the vote. Democrats did that in 2012, when President Barack Obama got re-elected with 51 percent of the vote.

Russian President Vladimir Putin meets with (clockwise, starting in top left.) U.S. Secretary of State John Kerry, British Prime Minister David Cameron, next Israeli Prime Minister Benjamin Netanyahu and U.N. Secretary-General Ban Ki-moon. REUTERS/FILES

A string of leaders and senior emissaries, seeking to prevent further escalation of the Syria crisis, has headed to Moscow recently to meet with Russian President Vladimir Putin. First, U.S. Secretary of State John Kerry, then British Prime Minister David Cameron, next Israeli Prime Minister Benjamin Netanyahu and now, most recently, U.N. Secretary-General Ban Ki-moon These leaders see Russia as the key to resolving the Syria quandary.

But to get Russia to cooperate on any stabilization plan, the United States and its allies will have to take into account Russia’s significant interests in the Mediterranean region.

President Ronald Reagan (L), President George W. Bush (R, Top) and George H.W. Bush (R, Bottom) Reuters/Files

The hoopla over the new George W. Bush Library in Dallas, as well as some gauzy looks back penned by former aides, shows we are in the middle of “The Great Bush Revisionism.” The former president is being lauded and congratulated. But for what?

A new examination of Bushism may be helpful because the current scandals in Washington are the symptoms of too much power and too much arrogance.

Security worker opens the door of a government job center as people wait to enter in Marbella, Spain, December 2, 2011. REUTERS/Jon Nazca

In the nearly five years since the worst financial crash since the Great Depression, the remedy for the world’s economic doldrums has swung from full-on Keynesianism to unforgiving austerity and back.

The initial Keynesian response halted the collapse in economic activity. But it was soon met by borrowers’ remorse in the shape of paying down debt and raising taxes without delay. In the last year, full-throttle austerity has fallen out of favor with those charged with monitoring the world economy.