The 112th Congress Faces Daunting Challenges

The 112th Congress convenes amidst daunting economic challenges. Not only is the pace of growth and job generation much too slow, but also the long-term budget deficit threatens our economic stability and global standing. We need both faster growth and fiscal restraint. It will be no easy matter to craft policies that strike the right balance between these key policy imperatives.

The polarization of American politics will make a tough job even harder. The two parties disagree on economic fundamentals, and because each now enjoys a share of real power, nothing will get done unless they manage to agree.

Flash-points will occur early and often in 2012. The new House Speaker, John Boehner, has pledged to cut $100 billion—more than 20 percent—from discretionary domestic spending this year. If the Republicans set aside President Obama’s 2012 budget proposals—due to reach the House in mid-February, as “dead on arrival,” they will have the responsibility of crafting an alternative. On March 4, the continuing resolution funding government activities this year will expire and must be replaced. And by spring at the latest, Congress will have to raise the debt ceiling, a step many incoming Republicans have pledged to resist.

Beyond these budget controversies, Republicans have pledged to reverse much of what President Obama and the Democrats did in the 111th Congress. A measure repealing the new health reform law will probably pass the House next week, only to die in the Senate. Even so, Republicans are likely to continue the onslaught against the law, using the available legislative, appropriations, and oversight processes. They will also try to terminate the economic stimulus enacted in 2009 and slow the implementation of the financial regulatory legislation that passed last year.

Many analysts are predicting two years of gridlock, and it’s easy to see why. But the American people have a different expectation. Numerous post-election surveys have documented majority support for cooperation rather than confrontation between the parties. Notably, Independent voters, whose changing sentiments between 2008 and 2010 shifted control of the House of Representatives from Democratic to Republican hands, are demanding a politics that focuses on solving problems rather than scoring points. The party that the American people come to see as the principal obstacle to progress over the next two years will pay a steep price in the 2012 election. It remains to be seen which party manages to avoid that fate.