From Meltdown to Shutdown

Editorial-October 1, 2013, 6:29 pm 

A devastating financial meltdown and the attendant chaos, inter alia, propelled Barack Obama to power in 2008 because he looked a messiah, as it were, in the eyes of the American public sunk into the depths of despair and despondency. The US economy improved on his watch considerably and his reward came in the form of a second term. But, today, he is troubled by a federal shutdown.

With the current fiscal year’s budget expiring on Monday, the Republicans gave Obama a tough choice between having funds for government and the implementation of his progressive health care programme which is anathema to his rivals for obvious reasons. He opted to stand his ground and the Congress refused to pass funds, causing a government shutdown. Over 700,000 federal workers have already been placed on unpaid leave indefinitely. Unless Obama and the Congress iron out their difference and reach consensus shortly, the situation is sure to take a turn for the worse. There may even be street protests.

President Bill Clinton also played chicken with a Republican-controlled Congress in 1995 and was deprived of funds for government. The Republicans wanted him to curtail public expenditure. But, he held out courageously and the Congress blinked after three weeks; he went on to secure a second term.

Obama has apparently chosen to do a Clinton. Without giving in to Congressional pressure he is trying to turn public opinion against the Republicans in a bid to make them cave in. His propaganda campaign is apparently beginning to yield the desired results according to initial opinion polls. But, the situation is still fluid, and whether he will be able to turn the tables on the Republicans remains to be seen. Chances are that he will. For, the new healthcare law or Obamacare has gone down well with the ordinary Americans and the Republicans run the risk of incurring public wrath if they continue to crank up pressure on Obama to shelve it.

The federal shutdown has shed light on the systemic flaws of the US presidential system. The US President is at the mercy of his rivals if he fails to secure a clear majority in the Congress or the Senate or both. The US is lucky that shutdowns are rare and ephemeral and the Democrats and the Republicans act with responsibility most of the time. They haven’t shut the door on a compromise formula, though the Democrats in the Senate have rejected, out of hand, their rivals’ offer over the weekend to fund the government if the fine Obama’s healthcare law seeks to impose on the rich who refuse to buy health insurance, is put on hold for one year.

Temporary as the shutdown may be, it is bound to have a debilitating impact on the US economy which has already hit a sticky patch. In a message to the American troops President Obama has accused the Congress of having failed to fulfil its responsibility. President Mahinda Rajapaksa would have had to tell his military something similar if the western bloc’s efforts to have his budgets defeated in Parliament in 2007 and 2008 and thereby engineer the collapse of his government as well as his war effort had succeeded.

America’s enemies must be deriving some perverse pleasure from President Obama’s predicament, but further debilitation of the US economy leading to a sharp drop in consumption is likely to have global consequences.

It is hoped that President Obama will realise that Syria is the least of his problems and he should concentrate more on the economic front. The Republicans did him and the US a big favour by preventing him from opening another military front abroad.