Fiddling while Rome burns

The classic image of the Emperor Nero playing the fiddle while around him Rome burns has been used in everything from Bugs Bunny cartoons to various political campaigns.  But on the heels of lack luster economic reports indicating that retail sales are slumping as we go into back-to-school season, it would take only the most blind of individuals to wonder if Congress is the organization doing the fiddling.

As we roll into full on election season, it is easy to target the Office of the President as responsible for the poor economy.  After all, the Representatives are the ones bringing home the bacon, in theory, to their districts, while the President sits in Washington, fiddling with the economy.  Of course, anyone with a modicum of economic theory knows that this is absolutely not the case.

Gasoline prices are up.  That is normal during the summer driving season, but also because of additional sabre rattling in the Middle East, mainly in Iran, with additional pressures from speculators hoping to make a quick buck and processors who have sliced production capabilities.  All of this is not the fault of a single individual, but is the result of a complex market.  But it is something that Congress has a bit of control over.  Least of which is the massive incentives that the oil companies have been given for everything from tax credits for pretending to search for alternative energy solutions to tax credits for cleaning up their own messes.

Congress has been dragging their feet over several other issues this summer.  The biggest two are the extension of the Bush era tax cuts, and extending the Federal Highway funding.  The latter was passed at the last minute, but the uncertainty that it would be passed put a significant number of workers, and companies on edge.  Would you go out on a limb and hire someone if you were unsure the money you had been counting on was not approved?  The same is true with the tax cuts.  Congress is generating enough uncertainty over extending these cuts, that the average consumer is bogarting their limited funds.

Finally, a report out this morning should come as a cold splash of water in the face of even the most head-in-the-sand Representative.  The  Aerospace Industries Association has concluded a study that indicates, unless Congress gets off its collective ass, upwards of two million government contractors will be out of work if the cuts implemented as part of the debt ceiling debacle late last year and the failure of the Super Committee to come up with a realistic workaround.  This is an additional million over reports out of Lockheed Martin earlier this year.  And these are only the jobs lost at the primary level and does not include jobs lost as a result of the primary level not spending money.  If retail sales are down now, can you imagine how back Christmas will be if Congress does not act?

When you go to the polls in November, and cast your vote for President and Congressional representative, think hard about the damage that Congress has been doing to the economy over the last four years.  From the failure to reach a consensus on cuts needed to avoid the loss of jobs, to the give aways to companies that are securing record profits, these are issues that only the Congress can deal with.  The President is little more than a figurehead in all of this.

On Insanity

Yesterday, the House of Representatives voted for the 33 time to repeal the Affordable Care Act.  (If the Republicans call the ACA Obamacare, do they call the Massachusetts law it was based on Mittmanagement?  Nah…it was outsourced…).  There is an old saw that says the definition of insanity is doing the same thing over and over again and expecting a different outcome.  Well, no one ever said our representatives were sane…

I can understand why the Party of No wants to repeal the law. They feel that health care is a privilege, not a right, and therefore it should only be available to those that can afford the privilege and as for the rest, it is natural selection…er…the creator’s choice.  Fair enough, but how do you feel about fraud, waste, and abuse?

Have I got your attention yet?  I am serious.  If the vote to repeal the ACA only took 10 minutes, from introduction to total count of votes, that means Congress has wasted 330 minutes of time.  That translates to five and a half hours of Congressional time, essentially one complete day.  And they do not work that many days to begin with.  But let me put it in more economic terms.  Each member of Congress, House and Senate, earns a minimum of $174,000 year.  That is $83 an hour, based on a normal work year of 2080 hours (and we all know Congress does not work normal hours.  Feel free to argue the number to yourselves).  At $83/hr, that is $456.50 per member of the House.  There are currently 435 voting members of the House, which means these symbolic votes have cost the American tax payer $198, 577.50.  Or a little more than the annual salary of one member of Congress, and certainly more than the annual salary of many Americans…in fact, it is a little more than 4 years of salary based on the median household income statistics from 2011.  Let me say that again.  The symbolic vote cost the American Tax payer 4 years of their salary.

Now, that is the conservative estimate.  We all know there was debate, and discussion.  There were photocopies and staff time.  The number does not begin to consider tertiary costs either.  For example the cost of running the Capitol – heat, light, air conditioning, etc.  If we bump the time to 30 minutes, which is reasonable for introduction, discussion and vote, we are talking about a little more than 16 total hours and a cost just under a half a million dollars.  To attempt to repeal a law that has no chance of currently being repealed.  If that is not insanity, then it is certainly fraud, waste, and abuse of the American Tax Payer.

But more to the point, what else could the Congress be doing?  Well, if you have been paying attention, quite a bit.  Yet they seem to have decided not to.  For example, the Congress waited until the 11th hour to renew a jobs bill that funded infrastructure.  If they had not been busy wasting time trying to repeal a law that had no chance of being repealed, they could have passed the reauthorization and keep people from worrying whether they would have a job the following morning.  Or, how about the upcoming Sequestration?  Conservative estimates indicate that as of Fiscal Year 2013, which begins October 1, 2012, a month before the election, more than one million defense jobs could be lost if Congress does not step in and do something.  Let me stress these million jobs are at the primary level.  It does not count the supply chains, or tertiary jobs losses.  The loss of a million jobs will be more than have been lost since the financial melt down in 2007 and could rival the Great Depression if it comes to pass.  But Congress was too busy to worry about that.  Sure they jobbed out a letter to a few defense contractors, but they were more concerned about repealing ACA.  After all, that is what was important.

When the candidates come knocking for reelection this year, ask them what they did during their time in Washington.  And if they said, I voted to repeal Obamacare, ask them why?  And then ask them, why they were not doing more for their constituency.  Failing that, perhaps suggest a good therapist.  Because clearly this form of insanity is contagious and needs to be curtailed.