By Lee H. Hamilton
A few weeks ago, I had a conversation with a group of prominent business
leaders that I’m still mulling over. We were talking about the intersection
between business and government, and they were pretty unhappy. The chief target
of their displeasure wasn’t any of the usual suspects, though.
Instead of lambasting taxes or regulations, they were most worried about
uncertainty in Washington. Their business prospects, they argued, are being hurt
by the inability of the political class — and in particular Congress and the
White House — to come to terms on pretty much anything: from the year-end
package of tax hikes and spending cuts known as the “fiscal cliff” to fixing the
health care system to resolving our disagreements over immigration.
Now, uncertainty is baked into our political system. As soon as a law
passes, hundreds of lobbyists head for Capitol Hill to try to change it, and
scores more descend on executive-branch agencies to see if they can nudge the
rules implementing the law as they’re written. Legislation that seems buried for
good in Congress can abruptly rise from the dead and pass both houses, while
laws that passed easily a few years ago suddenly find themselves
imperiled.
“Nothing ever gets settled in this town,” George Shultz once told the House
committee on which I sat when he was secretary of state. “It’s a seething
debating society in which the debate never stops, in which people never give
up.” Given the nature of our representative democracy, certainty and finality
are simply not achievable.
Yet the businessmen I met with had an important and valid point. The range
of really crucial issues on which Congress has been unable to find common ground
is immense. It has yet to decide what to do about tax cuts that are about to
lapse. It has a budget in place only until March and has not come to terms with
the threat of deep cuts to spending that were part of the debt ceiling deal of
2011. It’s left issues like the future of estate taxes, a new agriculture bill,
ensuring the security of our information infrastructure, and a rickety postal
service on the table. And it hasn’t given a clue as to how it might want to
address issues that are key to our economic competitiveness in coming decades:
education, infrastructure, taxes, immigration and the like.
As we near the end of the year, anyone trying to plan ahead has to confront
the fact that government policy for both the near and long terms is wildly
unforeseeable. And no one expects the upcoming election to clarify much of
anything.
This interminable gridlock in Washington produces a signal lack of
leadership. Unable to formulate policy, let alone think strategically about the
future, Congress punts. Which is terrible for the country. As The New York
Times noted a few months ago, “A rising number of manufacturers are
canceling new investments and putting off new hires because they fear paralysis
in Washington will...undermine economic growth in the coming months. Executives
at companies making everything from electrical components and power systems to
automotive parts say the fiscal stalemate is prompting them to pull back now,
rather than wait for a possible resolution to the deadlock on Capitol
Hill.”
The problem is that politicians in Washington get so wrapped up in their
own world that they seem unable to recognize the consequences of their inaction
and last-minute antics. The bad habits they’ve developed in recent years — an
inability to enact a budget or address taxes, the omnibus bills that concentrate
power in the hands of just a few people, the lack of transparency and
overabundance of partisanship — all have brought us to a point where people who
depend on government to create a stable policy environment can no longer do
so.
Yes, uncertainty may be built into our representative democracy, but so is
the assumption that our elected leaders will take responsibility for bringing
solidity to the policies that affect our society and economy. Politicians of
both parties simply must step up their game, or they’ll create chaos.
Lee Hamilton is Director of the Center on Congress at Indiana
University. He was a member of the U.S. House of Representatives for 34
years.
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