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It was a pretty good idea. A group of politicians and business leaders were recently commissioned to address the country’s runaway debt. They panel met in relative silence for months, presumably to concoct a bitter pill that would be palatable to the majority. Two weeks ago the proposed measures – stamped with the attention-grabbing title of “The Moment of Truth” – became public.

The proposals immediately received a fair amount of attention. In general I found the recommendations rather sensible. The proposal called for the trimming of the fat (I’d like to think a recommendation to pull $238,000 for ancient-style sailing canoes in Hawaii didn’t elicit hours of debate) and didn’t shy away from scrutinizing and recommending cuts to the once sacred cows of Medicare and Social Security.

Yesterday the measures came up for a vote among the same panel who had created the proposal. The tally? 11-7 in favor of a mix of obvious, progressive and perhaps somewhat radical cuts aimed at trimming the deficit.

But before you go adjusting next year’s tax projection, consider this: 11-7 isn’t good enough in D.C. In fact, a long overdue 11-7 vote in favor of enacting change to control the red ink means the proposals are dead in the water. In D.C. the majority doesn’t always rule. They needed a super majority of 14 votes to move the aptly abbreviated “Truth” along to Congress for a vote. So we have 50 plus pages of bipartisan suggestions with no legs.

The quotes this morning are generally predictable – a confusing mix of “still optimistic” peppered among several versions of “no fair.” I’ll admit to only skimming today’s articles though. I’m not sure it really matters. The bickering continues. Surprise, surprise.

Even I’m optimistic that we won’t miss the opportunity though. We need to at least engage in a dialogue about this crucial issue facing our country. I’m encouraged every time it becomes popular to take a stand against borrowing money to continue unsustainable and irresponsible spending.

The more interesting question may be whether we have the perceived luxury of time. Do we have time to create a 50 page proposal, place it in the circular file when it fails to garner the support of some supermajority and continue another round of the blame game? It certainly would be nice to address our unsustainable spending and enact imperative change on our own time. The alternative is for the bond market to force the issue. I’d suggest the former is far superior to the latter. Just ask Greece, Ireland and Spain. When the bond market decides it’s time for you to get your fiscal house in order, it just isn’t pretty. To put it mildly, markets don’t wait on partisan politics and special interests. Instead it kind of laughs from afar and punishes all.

Though “The Moment of Truth” may now be deemed irrelevant, the proposals aren’t lost on the prudent investor. The 50 pages summarized inconvenient truths we’ve long ignored. Eventually change will come. It will either become politically acceptable to enact reform or the market will force the issue. The issues may be complex, but the eventuality is decidedly straight-forward.

The true value of this panel’s exercise may lie in offering taxpayers a window into determining the areas most likely to be affected in eventual reform. This includes the mortgage interest deduction, alternative minimum tax, taxation of dividends and retirement plan contributions. The spirited debate that resumes today provides an opportunity as well. While politicians bicker, investors have time to read the proposals, identify how the tax code may change and proactively adjust their financial plans for the eventual changes.

At Granada, we spent a Saturday reading the 58 page PDF file so our clients can spend their weekends on presumably more enjoyable activities. We’ve analyzed their findings and recommendations. In turn, we’ve identified specific actions for clients to consider ahead of eventual reform. For more information on how you can be proactive in adjusting your plan and avoiding unnecessary taxation, we welcome your call.