The ongoing debate over raising the debt ceiling has dominated another week’s worth of news coverage. Now Moody’s has put the U.S. government “on notice” – something I thought only Stephen Colbert could do – that our debt rating may be downgraded if the current impasse continues. As I mentioned in my last rant, this is a manufactured crisis. It’s a standoff not over debt yet to be incurred, but debt already booked by Congress by virtue of budget items already agreed to. There is no reason for this threatened default other than to make political points… and yet it continues, even though the downside risks are substantial.
How substantial? Default – or even near-default – could cause a global financial disruption on a scale that would dwarf that of late 2008. At the very least, a downgrade of the investment rating of U.S. Treasury bonds would be not only unprecedented but extremely costly, making service on our existing debt far more costly, blowing an even bigger hole in the federal budget. If that alone were to happen it would be bad enough. But these facts just don’t seem to register on Capitol Hill.
It’s often been said that, in a Democracy, we get the government we truly deserve. Last fall, the American people – by voting or by abstaining to do so – sent to the House of Representatives a class of Republicans that amount to the American version of the Taliban. The core of this class are fanatical believers in their own delusions; they see reality as a nefarious socialist plot. Fueled by tea party faux-populism, the new G.O.P. goes beyond their party’s traditional obsession about cutting taxes. Anything – anything – that brings more revenue to the Federal government is to them an unacceptable burden on the American taxpayer. (i.e. rich people. They apparently don’t consider burdensome the enormous costs displaced to workers, pensioners, etc. as a result of the massive cuts to Medicare, Medicaid, and other programs they demand.) That much is a given. The only wild card is in the president’s hand – what will he sacrifice to appease them?
This is what we voted for, whether we realize it or not. More likely not, since the Republicans did not advertise this part of their program. (It was going to be jobs, jobs, jobs, remember?) While it’s far from the only thing we need to do as citizens, it’s obvious that voting is essential… just as it’s clear that we need to hold our leaders – namely Obama – accountable when they give away the store.
luv u,
jp
