Within every pundit sleeps a playwright who is a light sleeper. Mine is wide awake and writing a script for the six months between now and the November elections, beginning, as things often seem to, with the Supreme Court, concerning which there is a naughty joke going around:
The justices (says the joke) decide to restore their frayed collegial feelings by going out to lunch together. A chivalrous waiter takes the lady justice's order first. She says: "I'll have the veal." The waiter then asks her: "What about the vegetables?" And she says: "They'll order for themselves."
Now, now. Order in the court. These days the justices are testy toward one another, but they probably can quickly agree that Gramm-Rudman-Hollings is constitutionally infirm. The following script is not by any means a "worst case" scenario, but it is bad enough to give Republicans sleepless nights or, as the president likes to say, sleepless afternoons.
Under Gramm-Rudman, the president submits his menu of pains to shrink the deficit. Then Congress either ratifies his menu or writes its own menu, or the comptroller general calculates and orders the semi-across-the-board spending cut required to hit the deficit target. (I say "semi-" because there are lots of exemptions and fiddles.) For reasons too arcane to be suitable reading in a family newspaper, the court will probably agree with a lower court that the comptroller general's role violates the doctrine of the separation of powers. Thus Gramm-Rudman will be a gun without a trigger.
Well, no, actually there is, as it were, a fallback trigger: Congress could order the cuts. But if Congress were disposed to do that sort of thing, we would not be in the pickle that produced Gramm-Rudman.
It is said the financial markets, and especially the stock market, have factored into their calculations a court ruling against Gramm-Rudman. But the markets are chipperly assuming that the ruling will not matter. They are assuming that the fact that Congress passed Gramm-Rudman indicates that Congress is driven by conviction (or the next best thing, fear of the electorate) to shrink the deficit even without the cover of the Gramm-Rudman "Who, me?" mechanism -- the look-ma-no-congressional- hands approach to budget-writing.
But suppose Congress says: Hey, economic growth is shrinking the deficit; we read it in The New York Times, no less. Or suppose Congress says: We shall not shrink from shrinking the deficit, so here is a package of spending (especially defense spending) cuts and tax increases. Congress could pass such a bill, and the president could veto it. It would strike at the two pillars of Reaganism -- tax cuts and rearmament.
Now, what will become of today's economic euphoria when the markets realize that the government is back to (back? it never stopped) business as usual? Suppose September sees a continuing paralysis of the government's choice mechanism. Remember, the stock market is not just an indicator of trends, but because of the enthusiasm it engenders, it is a cause of trends. What will be the effect on it of a realization that Gramm-Rudman was a false dawn?
Perhaps serendipity will suffice to keep the economy buoyant. Even terrorism has an economic benefit. Some Americans who are especially pleased by the action against Libya are operators of McDonald's and similar restaurants. This summer more Americans will stay home and more Europeans will come here. And they all will drive around, pausing only to eat hamburgers and McNuggets. (A potential casualty of Muammar Qaddafi is "The Mousetrap," the Agatha Christie play that has been running in London's West End for 33 years and 10,000 performances. By now its audience consists mainly of American tourists.)
With lots of U.S. currency staying home and lots of other currency arriving in search of McNuggets, the economy will get a nudge. But suppose it is not sufficient, and entropy in the budget process encourages the economy to stagger as the election approaches, and divisions among Senate Republicans are blamed.
Today the Republicans control the Senate, 53-47. Suppose in November a combination of Republican seats gained and lost that comes to minus three. Suddenly Vice President Bush has to hang around the Senate to cast tie-breaking votes on budget cuts and other nastiness that any politician not planning to retire would prefer not to vote on at all. Richard Nixon predicts this "minus three" outcome and thinks it will hurt Bush by keeping him off the campaign trail.
Hmmm. Given the general problem of overexposure of candidates and Bush's recent trajectory, that could be serendipitous for Bush.