SuperCommittee Fails to Reach an Agreement

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(Best Syndication News) The supercommittee failed to reach an agreement this weekend in Washington setting in motion possible automatic budget reductions. This sent the stock market lower Monday as nervous investors begin to price-in a sweeping decrease in government spending.

The committee was constructed as a result of the debt-ceiling crisis and the Budget Control Act of 2011, which was passed on August 2, 2011. The sub-committee is composed of 12 members: six Senators and six Representatives. The members were split evenly among Democrats and Republicans.

Committee co-chairs, Senator Patty Murray (D-WA) and Rep Jeb Hensarling (R-TX), released a statement after the markets closed Monday. “After months of hard work and intense deliberations, we have come to the conclusion today that it will not be possible to make any bipartisan agreement available to the public before the committee’s deadline.”

Not all economists agree that the supercommittee was the sole cause of the sell-off on Wall Street today, but most agree that the bickering in Washington didn’t help. Mark Blyth, a professor at Brown University, said that the American people need to ignore the “tedious side show.” Many analysts never expected the supercommittee to sort things out and reach an agreement.

U.S. President Barack Obama said that he would veto any attempt to circumvent those cuts. “I will veto any effort to get rid of those automatic spending cuts to domestic and defense spending,” the President said. “There will be no easy off ramps on this one,” the President said.

“This process did not end in the desired outcome, but it did bring our enormous fiscal challenges into greater focus,” House Speaker John Boehner (R-OH) said Monday. “I am confident the work done by this committee will play a role in the solution we must eventually find as a nation.”

“Make no mistake: we will achieve the more than $2 trillion in deficit reduction we agreed to in August,” Senator Harry Reid (D-NV) said in a statement Monday. “The sequester was designed to be painful, and it is. But that is the commitment to fiscal responsibility that both parties made to the American people.”

It appears that many political pundits are happy with the outcome. Groups on both sides of the spectrum released statements today.

The Cato Institute, a libertarian/conservative think tank, welcomed the failure to reach an agreement. “That’s probably a good thing because it sets up an automatic sequester to trim spending by $1.2 trillion over 10 years,” Cato’s Chris Edwards said Monday. “If the supercommittee had agreed to a deal, it might have paired phony spending cuts with real tax increases.”

The United for a Fair Economy organization also applauded the results. The UFE “praised Democrats on the Super-Committee who blocked Republican members’ demands for bigger tax cuts for millionaires and billionaires coupled with deep cuts to Social Security, Medicare, and Medicaid that would hurt most Americans.”

By: Dan Wilson

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