Lessons and implications of the US Federal government shutdown

Bulatlat Perspective

The US has reached a budget impasse forcing the Federal government to partially shut down some of its operations, beginning October 1. The shutdown has affected agencies that provide social services, and around 800,000 civil servants who were forced to go on unpaid leave and 1.3 million more who are forced to work without pay. But the shutdown did not affect the US Armed Forces. (Talk about spending priorities.)

The Republican-dominated Congress refuses to approve a temporary spending bill and raise the debt ceiling that would provide funding for the operations of the Federal government, unless the Obama administration commits to more spending cuts, most especially Obama’s 2010 health care law. US President Barack Obama, on the other hand, wants Congress to first provide short-term funding for the government and extend the credit limit before talks on spending cuts would begin. As it stands, both sides are holding their ground and the Federal government would default on its loans if the impasse would not be temporarily resolved by October 17. It is a display of brinksmanship. Let us see who blinks first.

Nevertheless there are a lot of things to learn from the current impasse in the US. This shows how deeply indebted and in crisis the US is. It could no longer fund the operations of the government without raising its ceiling on debts. Well, the heavy indebtedness of the US government could be attributed to the economic crisis; the glut in the world market amid stiff competition among the world’s economic powers; the fact that the operations and production of big US corporations are spread all over the world, thereby depriving the US government of much-needed taxes; the tax breaks and subsidies given to these very same US multinational corporations, including the giant, greedy oil companies; the heavy Defense spending, which contributes practically nothing to the economy except to bully the competitors of the US and impose its will on weaker countries, among others.

The implication of the crisis in the US on the country is that it could no longer reestablish and maintain a large military base in the Philippines even if it wanted to. What it is trying to do now is to “share” bases and camps with the Armed Forces of the Philippines (AFP), while making the Philippines foot half, or even more, of the expenses that would be incurred in constructing additional military facilities for the use of US troops, such as the planned mini-naval base at Oyster Bay.

So what would happen is that the Philippines would shoulder a big chunk of the costs of construction but access of AFP troops to these facilities would be decided on by US troops.

Second, the impasse shows the strong conservative current in US politics, and we are not just talking about the existence of the Tea Party, a group of ultra-conservative Republicans. One of the main targets of the Republicans is Obama’s signature health care program, popularly called as Obamacare. This health care program does not even cover all US citizens, not even all of the poor. Free health coverage is only being given to special categories of eligible groups from among the ranks of the poor such as children, pregnant women, parents of eligible children, people with disabilities and elderly needing nursing home care, people with ages 65 or older, people under age 65 with certain disabilities, and people of all ages with end stage renal disease.

This is the very same health care policy that is being emulated by the Aquino administration. PhilHealth coverage is mandatory but only certain segments of the poor are being given free coverage. Worse, the criteria are not even clearly defined, much like the Conditional Cash Transfer program or the Pantawid Pamilyang Pilipino Program, thus, favoritism and politics play a big part in the selection of beneficiaries. This policy framework, which is consistent with the neoliberal economic agenda, is the reason why the Aquino administration refuses to further fund the provision of free health care services, even if it would only entail the reallocation of pork barrel funds.

Third, while the Congress-imposed debt ceiling is the bone of contention, this is one policy that is worth considering. The Philippine government has no such thing as a self-imposed debt ceiling. This is why the country is being buried deeper and deeper into debt. Instead of a debt ceiling, what the government has is an Automatic Appropriation law, which automatically appropriates a budget for all due payments for the principal and interest of public debts. So all previous administrations are free to contract debts but could not delay payments for it.

Fourth, while the current impasse in the US is debilitating to the government, it is also instructive of issue politics and how checks and balance between two branches of government – executive and legislative – could operate. The political positions of the Tea Party Republicans are anachronistic and disgusting, no doubt. They also make the ordinary American appear ignorant such as when they accused Obama of promoting socialism with his health care program. It also true that even with changes in the party in power, Republican and Democrat administrations have been consistent with the neoliberal economic agenda and the drive to assert US military hegemony.

However, they clash in certain policies such as what happened with the budget impasse. At least there are still some policy differences and a semblance of checks and balances. In the Philippines, the Congress does not really scrutinize the expenditures and budget of the executive. They just pass the General Appropriations Act, year after year, after going through the motions of budget hearings.

Also, there are no distinguishable policy differences between political parties. Politicians transfer from one party to another to pursue their political ambitions and interests. And after the elections, politicians transfer en masse to the party in power. Why? To avail of the most important perks: committee chairmanships and pork barrel allocations. In the Philippines, the pork barrel is an important tool for buying the votes and loyalties of elected officials.

Do you still wonder why the Aquino administration, despite its declarations of treading the daang matuwid and being against corruption, does not want to give up the pork barrel?

Analysts predict that President Obama and the Republican-dominated Congress would not let the budget impasse reach a point where the US would default on its loans. In other words, a compromise is in the offing. Both sides are merely trying to strengthen their respective positions by reinforcing their leverage against each other.

The US budget impasse and partial Federal shutdown is on its tenth day, as of this writing. And yet, it has already revealed a lot about the state of the US and its political dynamics. It has also provided us with the basis to reflect on our own government’s policy directions and the political dynamics, or lack of it, in the Philippines. (https://www.bulatlat.com)

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