An American Farce
The dust is now well settled on the Great Debt Ceiling Debacle which occurred in Washington, DC recently. The results: Democrats failed to suck even more money out of the pockets of the American people, Republicans failed to reduce the deficit in a meaningful way, the President, his bluff called, didn't veto an 'unbalanced' bill, and the Tea Party held their 'no new taxes' ground, winning almost universal excoriation by the leftists in the bargain.
So who are the biggest losers in all this? Not Obama, not the Democratic Party, the Republican Party or the Tea Party faction; we are the biggest losers - the American people.
Standing far off the fruited hills & plain of Washington, DC, my impression of all this was that the Republicans, the Democrats, and the President all peered over the default cliff and were so frightened of what they saw that they came together to agree to disagree, and therefore produced a tepid attempt at a bill to save face as much as they could after all the tough talk, bluster and brinkmanship. And that agree-to-disagree face saving bill had one thing and only one thing in mind: the 2012 election cycle. All it accomplished was to piss everybody off.
From my point of view, only the Congressmen affiliated with the Tea Party seemed to walk away from this with at least a perception they they stuck to their guns, and followed through on the fiscal conservatism promises that got them elected to office. This conviction resulted in most of the vicious rhetoric coming from the left, and many in the leftist media, being reserved for the Tea Party. I read an editorial from a local newspaper on the debt-ceiling mess. The editor was clearly a leftist, and decried the fact that Obama didn't 'stand by his principles'. In the very same editorial, the editor then proceeded to blast the Tea Party for standing by their principles(!). Can't win for losing, as they say.
In my last post, I said I had hoped that the Republicans would at least hold up honorably in the final deal. They didn't. One trillion in phony savings is a lot different than the originally proposed 4 trillion in meaningful cuts. As many others have already pointed out, the 1 trillion in deficit reduction did not impact the current footprint of the federal government at all. The 1 trillion was merely a promise to reduce future spending increases over 10 long years. In other words, toothless, and nearly meaningless. We all know how much credibility promises have coming from Washington. None. Many say it was better than nothing, and at least the Republicans held the line on no new taxes. Well, I guess so, but that's just not good enough - not in the middle of a national economic crisis. We went through all that drama, threats from the left, threats from the right, threats from the President, threats from Wall Street, threats from international market movers....all that for this outcome?? A total farce indeed, or as one British journalist put it, the "theater of the absurd". Yes it was.
Now that the show is over, Standard and Poors writes the epilogue in this tragic comedy. They have downgraded the credit rating of the United States government, citing, in part, the absurd theater, and the tepid nature of the deficit deal it wrought. On the one hand, I don't know quite enough about the nitty-gritty details to judge whether it was the technically correct thing to do, or whether there was, at least in part, underlying political motivation by S&P. On the other hand, reacting to all this intuitively, rather than analytically, I'd say Washington earned the downgrade purely based on the buffoonery that just went down on all sides. I've read that the left has accused the S&P of a $2 trillion dollar error associated with their analysis leading up to their decision to downgrade. But...what error? Of all the organizations out there that report financial renderings, no organization plays funny-money games with 'off-balance sheet' accounting and the like more than the federal government itself. Indeed, if the federal government were held to the same financial reporting standards/rules/regulations as a publicly traded corporation, all of Congress would be imprisoned by now for financial fraud perpetrated against the American people. So, I am unimpressed by people who can't keep their books straight complaining that S&P can't add. Totally unimpressed.
In the end I can say this: Every President frets about the legacy of his(her) term in office, and in this case, President Obama can now boast of presiding over the first downgrade of US credit in the 235 years since the colonies declared their independence. And that downgrade, Mr. President, was not inherited, you earned it.
The Republicans be not blameless, yet they still hold the best promise for returning to something akin to fiscal sanity. It's up to you and me to finish the job started in November 2010, and sweep the Democrats out of power in 2012 in order to get on with the crucial business of fixing this terrible mess.
So who are the biggest losers in all this? Not Obama, not the Democratic Party, the Republican Party or the Tea Party faction; we are the biggest losers - the American people.
Standing far off the fruited hills & plain of Washington, DC, my impression of all this was that the Republicans, the Democrats, and the President all peered over the default cliff and were so frightened of what they saw that they came together to agree to disagree, and therefore produced a tepid attempt at a bill to save face as much as they could after all the tough talk, bluster and brinkmanship. And that agree-to-disagree face saving bill had one thing and only one thing in mind: the 2012 election cycle. All it accomplished was to piss everybody off.
From my point of view, only the Congressmen affiliated with the Tea Party seemed to walk away from this with at least a perception they they stuck to their guns, and followed through on the fiscal conservatism promises that got them elected to office. This conviction resulted in most of the vicious rhetoric coming from the left, and many in the leftist media, being reserved for the Tea Party. I read an editorial from a local newspaper on the debt-ceiling mess. The editor was clearly a leftist, and decried the fact that Obama didn't 'stand by his principles'. In the very same editorial, the editor then proceeded to blast the Tea Party for standing by their principles(!). Can't win for losing, as they say.
In my last post, I said I had hoped that the Republicans would at least hold up honorably in the final deal. They didn't. One trillion in phony savings is a lot different than the originally proposed 4 trillion in meaningful cuts. As many others have already pointed out, the 1 trillion in deficit reduction did not impact the current footprint of the federal government at all. The 1 trillion was merely a promise to reduce future spending increases over 10 long years. In other words, toothless, and nearly meaningless. We all know how much credibility promises have coming from Washington. None. Many say it was better than nothing, and at least the Republicans held the line on no new taxes. Well, I guess so, but that's just not good enough - not in the middle of a national economic crisis. We went through all that drama, threats from the left, threats from the right, threats from the President, threats from Wall Street, threats from international market movers....all that for this outcome?? A total farce indeed, or as one British journalist put it, the "theater of the absurd". Yes it was.
Now that the show is over, Standard and Poors writes the epilogue in this tragic comedy. They have downgraded the credit rating of the United States government, citing, in part, the absurd theater, and the tepid nature of the deficit deal it wrought. On the one hand, I don't know quite enough about the nitty-gritty details to judge whether it was the technically correct thing to do, or whether there was, at least in part, underlying political motivation by S&P. On the other hand, reacting to all this intuitively, rather than analytically, I'd say Washington earned the downgrade purely based on the buffoonery that just went down on all sides. I've read that the left has accused the S&P of a $2 trillion dollar error associated with their analysis leading up to their decision to downgrade. But...what error? Of all the organizations out there that report financial renderings, no organization plays funny-money games with 'off-balance sheet' accounting and the like more than the federal government itself. Indeed, if the federal government were held to the same financial reporting standards/rules/regulations as a publicly traded corporation, all of Congress would be imprisoned by now for financial fraud perpetrated against the American people. So, I am unimpressed by people who can't keep their books straight complaining that S&P can't add. Totally unimpressed.
In the end I can say this: Every President frets about the legacy of his(her) term in office, and in this case, President Obama can now boast of presiding over the first downgrade of US credit in the 235 years since the colonies declared their independence. And that downgrade, Mr. President, was not inherited, you earned it.
The Republicans be not blameless, yet they still hold the best promise for returning to something akin to fiscal sanity. It's up to you and me to finish the job started in November 2010, and sweep the Democrats out of power in 2012 in order to get on with the crucial business of fixing this terrible mess.
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