The Fiscal Cliff continues to be a public relations disaster for America.
In this entry, IMRE examines the damage done by the sparring of our political leaders and their unwillingness to compromise, the impression the Fiscal Cliff deal has had on other countries, and what America’s leaders could do to manage the negativity stemming from the Fiscal Cliff crisis and ongoing debt ceiling negotiations.
While lawmakers did reach an agreement on the Fiscal Cliff in early January, it was only a band-aid solution. The agreement resulted in a range of tax increases, but did little to address spending. However, the subject will have to be readdressed in the coming weeks as Congress decides whether or not to raise the national debt ceiling to pay for its programs. The last time the government discussed the national debt ceiling, our credit rating was downgraded for the first time, and Moody’s has not ruled out the possibility of that happening again, according to Forbes.
More damage than a lower national credit rating could be tied to the Fiscal Cliff crisis and the inability of our political leaders to come to agreement. Overall, Americans have mixed feelings about the last minute Fiscal Cliff deal. A recent Gallup survey found that 43 percent of Americans approved of the deal, while 45 percent disapproved. The survey also found that Americans are generally more negative than positive about the way they feel political leaders handled the negotiations.
Needless to say, if Americans weren’t thrilled with the way the situation was handled, either was the rest of the world.
A recent Washington Post article summarized some of the sentiment of other nations and noted that people around the world see themselves directly impacted by U.S. policies, which is why our political wrangling is of such concern to them.
Australia’s National Treasurer Wayne Swan said that the impact of the U.S. Fiscal Cliff debacle could have global developments from which Australia would “not be immune”. Meanwhile, the French newspaper LeMonde reported that the episode doesn’t say much for the future of the U.S. political system. Similarly, social media users in China agreed that the Fiscal Cliff negotiations only demonstrated that the American political system is headed for failure.
Why should we care what other countries think of us? If other nations were to lose faith in our leadership and our economy – as a result of a protracted debt ceiling ordeal and possible credit downgrade – they might think twice before opening their wallets to us without higher interest rates.
So, what can America’s leaders do to clean up their reputations, and that of our country after this ordeal?
While there is no one easy answer, Republicans might take a cue from the Obama communications’ playbook. Just look at the numbers. Although Gallup found that most Americans believe the whole thing was handled poorly, they also found that President Barack Obama saw 46 percent of the population approve of his work in the negotiations process, while 67 percent of Americans disapproved of how Republican leaders handled the negotiations.
Here are a few ways that our leaders can improve their communications around this issue:
The day after the fiscal cliff deal was reached, CNN reported that President Obama said, “I want to thank all the leaders of the House and Senate. Under this law, more than 98 percent of Americans and 97 percent of small businesses will not see their income taxes go up.” While that may sound like great news, it’s only part of the story. In reality, while income taxes may not go up, 77% of Americans are seeing tax hikes in the form of payroll tax increases.
Messaging from our country’s leaders needs to be honest and clear. An improvement on this message would be “Americans will be paying more in payroll taxes, but overall, it’s still considerably less than they would have been paying if a deal had not been reached.”
Appoint a bi-partisan spokesperson at a command center who can clearly translate the legal jargon (what is the appropriation of money?), acronyms, curse words (government officials saying ‘f*** you’ to one another) and speak to American and International audiences about what, when, why, and how our elected officials are solving this problem. The Senate and House should institute morning and afternoon progress briefings, allowing media to ask questions.
Print and broadcast media may still be the workhorses of news, but blogs, tweets and Facebook updates are more effective at breaking news and critical in shaping perceptions For instance, Washington Post Opinion Blogger, Robert Samuelson posted an article discussing the state of American affairs and addressing the question ‘Is America in decline?’ By having a more active presence on social channels, a government official appointed to speak on behalf of the White House could join the conversation that follows in the comment section of the blog (56 comments in less than 24 hours). With government official weighing in on the decision, it not only shows that they are actively listening to Americans opinions, but it shows that they are working to have answers to the questions that so many Americans are asking.
IMRE will be watching closely as debt-ceiling negotiations convene to see if either the Obama Administration or Republican leadership take a new approach after the last round of wrangling. Will they present themselves differently this time? We’ll see.