Guest Columns

Industry Issues

Contrasts, conflicts, compromise — the U.S. budget dilemma

Connie Tipton

Connie Tipton is president and CEO of the International Dairy Foods Association. She contributes this column exclusively for Cheese Market News®.

Pope Benedict XVI shocked the world last week when he announced that he’s stepping down to make sure the Catholic Church remains in strong hands and with capable leadership. Also last week, President Barack Obama delivered his State of the Union speech, setting out a laundry list of populist programs to be implemented during his second term in office, despite a federal government checkbook that is already full of red ink. There is a clear contrast here — but I’ll let you define it yourself.

Unfortunately, Congress and our president are starting this year badly. So far, the president has failed to send a proposed budget to Capitol Hill in keeping with the statutory time line. Republicans in the U.S. Senate are skeptical about, even downright against, some of President Obama’s cabinet nominees. Democrats in the Senate want to avoid spending cuts by adding more tax increases, but they’re frustrated because they can’t do anything without the House of Representatives. And House Republicans, who are adamantly against more tax increases, are thinking the sequester proposed last year by President Obama may be the only way to get spending reductions, even though they recognize it will have some unpopular consequences.

The concept of sequestration is simple: It would mandate across-the-board reductions to the budget of every federal government department and agency. These budget cuts, totaling $1.2 trillion over the next 10 years, would be shared 50 percent by the U.S. Department of Defense and 50 percent by all other agency budgets – all in the name of reducing the national debt.

Budgets are always a touchy subject, especially among congressional leaders. When faced with another vote to increase our nation’s debt ceiling, House Republicans crafted a deal; they would agree to vote on the debt ceiling, but the Senate first would have to produce a budget for our country — something the senators have not done in four years. Offering a hint of compromise, that deal seems ultimately reasonable, but we’ve seen no signs yet of anything moving on that front. My advice after spending 30-plus years in Washington: Don’t hold your breath.

Meanwhile, the Obama White House and its administrators are waving around every threat they can possibly conjure up for the sequester scenario, including a lack of meat inspectors, which would virtually shut down an industry and hike food prices for American consumers. Oh, by the way, the CEO of the American Meat Institute, Patrick Boyle, has taken issue with Secretary of Agriculture Tom Vilsack’s assertion that meat inspectors would be furloughed, calling out the legal obligation of USDA to provide inspection services. Vilsack fired back, so if the sequester goes into effect we’ll see how this plays out.

We have no way to know how these across-the-board cuts would be implemented, but certainly heads of government agencies must have some ability to prioritize just as a CEO of a company would do when faced with tough budget challenges. Since the Department of Defense would take half of the cuts, it would undoubtedly have the toughest job, but who doesn’t think there are opportunities for eliminating waste and identifying savings in all of our government agencies? Prioritize, guys — take some responsibility and provide the leadership Americans expect and deserve.

As the political pundit Charlie Cook put it in a recent column, “The likelihood that sequestration cuts will take place March 1 is beginning to sink in. No one realized that quite a few members from both parties would prefer sequestration to making the painful concessions necessary for compromise — but that’s where we are.”

We have a dilemma. The conflicts among these groups are real, and they are based on vastly different philosophical beliefs. Politicians get elected by people who agree with their beliefs, so they want to deliver on priorities that they believe mirror the priorities of their constituents. For instance, there are only 14 Republican members in the House whose districts gave a majority vote to President Obama. Do you think that sets up the other 220 Republicans to want to compromise their beliefs and priorities with those of the president? I’m pretty sure that’s a resounding “no.”

Compromise isn’t going to happen without both sides giving on their priorities, period. So strap your seatbelts back on for what will probably be another bumpy ride.

As for me, I’m one who hopes the Republicans will call the president’s bluff and let the administration’s sequester go into full effect, contrasting the chaos of unfettered spending with the constricting control of mandated cuts. Maybe then there will be enough leverage on both sides to get real compromise on policies that will keep our fiscal house in order.


The views expressed by CMN’s guest columnists are their own opinions and do not necessarily reflect those of Cheese Market News®.

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