By Brendan Pringle

Fiscal Cliff

While the mainstream media and the academic world have been
buzzing about how the fiscal cliff deal benefits students, the
narrative about college graduates has been noticeably absent.

Yet if the Obama administration is really trying to break a
trend of youth unemployment and improve career prospects for
graduates, its “solution” is an obvious step in the wrong
direction.

Economic growth has remained painstakingly slow throughout the
years of the Obama administration. Last year,
half of young college graduates found themselves either jobless or
underemployed
, and nothing suggests that this trend is turning
around.

Despite all the backslapping, the deal is a disaster for this
vulnerable demographic.

After its passage, Utah Senator Mike Lee commented: “Everything about this bill was a
failure…what Congress did, how Congress did it and what Congress
didn’t do.”

Indeed, The Economist notes, “the bill does nothing to control
the unsustainable path of “entitlement” spending on pensions and
health care (the latter is on track to double as a share of GDP
over the next 25 years); nothing to rationalize America’s hideously
complex and distorting tax code, which includes more than $1
trillion of deductions; and virtually nothing to close America’s
big structural budget deficit.”

In other words, the deal sustains an unstable economy that
leaves most employers hesitant about increasing their hiring
despite the qualifications of applicants. With an uncertain market
and the added financial obligations of Obamacare, why take the
risk?

The deal also directly impacts those graduates who have actually
found a place in the workforce by
ending the payroll tax break
, allowing it to shoot back up to
6.2 percent, from 4.2 percent, as a provision of the deal.

The end result: Those who find jobs after college will
ultimately receive smaller checks.

President Obama’s boasted that the deal cuts
$737 billion
 from the deficit over the coming decade, but
this hardly combats the $10 trillion in deficits set to accumulate
during the same amount of time.

Meanwhile,
college grads’ share of the national debt currently hovers around
$50,000
-a figure that is constantly growing due to the
administration’s failure to balance the budget.

Of course, we can’t simply blame the Obama administration for
the outcome of this last-minute legislation. Many conservatives on
Capitol Hill compromised on their own principles, allowing
President Obama to get what he wanted without making any major
concessions.

Between this bill and the impending debt ceiling debate, college
graduates are caught between Obama’s unwillingness to compromise
and the general lack of political courage in Congress-a combination
that is not pretty.

Brendan Pringle is a Development Officer at Young America’s Foundation’s Reagan Ranch Center. 

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