The US deadlock

Today is a big day for America, and since the global economy is so interdepedent, the world.

President Obama has announced a budget deal has been cut and that Congress will now need to approve it in order for America to avoid a default. The outcome is sub-optimal, took far too long and quite frankly embarrassing to see such a mature democracy so riven with self-interest and grandstanding that it can bring the country so close to disaster.

For me, this episode is a stark reminder of how the interaction between political institutions and political behaviour can result in damaging and costly unintended consequences.

The US political system has a number of significant path dependencies from the period of the Founding that play themselves out on a daily basis: separation of powers, rotating and non-current membership of Congress and a ‘first-past-the-post’ electoral system that makes it nearly impossible for third parties to break into the system with new ideas and a new ground for representation (although factions of existing parties appear to make inroads).

These institutional choices and arrangements interact with our political culture that in comparative terms is anti-statist and anti-welfare, and it seems to me that we have commodified politics to such a dgree that candidates and representatives often lose sight of their purpose to serve the people.

The current budget deadlock is partly a product of the (a) institutional design (opposite party control of the House and the Senate vis a vis the President), (b) political culture (of which the Tea Party is a classic example of a recurrent strand in American politics), and (c) the economy, which puts a strain on the whole process.  Throw in a mix of posturing and self-interest and this makes for a very heady mix indeed.

In the end, it looks like a deal has been reached, but it seems a shame that it required this kind of brinksmanship.

Let’s hope everyone does the right thing today and approves this deal.

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