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defrogAs you may have noticed, there has been a lot of dithering in the US about the economy, the debt ceiling and how if we don’t raise it then the US will default and China will take over the dump.
Or something.
So what does it all mean? What will happen? And what’s the best economic plan that everyone should settle on?
Hell if I know. Ask an economist.
Seriously. I have no real wisdom on this, except for the really obvious point that, on a macro level, what we’re witnessing is the usual political game of Chicken, where Something Terrible will happen unless a deal is hammered out, and both the GOP and the Democrats in Congress have been betting large on all-or-nothing propositions in an effort to score as many political points as possible before eventually settling up on a compromise designed so that each party can claim to take credit for whatever works and blame everything else on the opposition.
The wild card, of course, is the Tea Party contingent that is so desperate to stick to their Small-Govt-Smaller-Budget mantra that they're convinced the debt ceiling is just something liberals made up to scare Americans into paying more taxes, and are urging the rest of the GOP not to fall for Obama’s Evil Plan to enslave America by elevating the debt ceiling to infinity.
Or something.
Anyway, here are the three (3) most sensible things I’ve read about the current state of things:
1. This article from The Economist.
2. This thought piece from John Scalzi.
3. This column from John Avlon.
They’re all critical of the GOP, yes. Even The Economist, which has never liked Obama’s fiscal policies to date. Which should tell you something.
All I can really add is that, for all my reputation as a dour pessimist, I think Congress will cut a deal at the last minute, and I think both party leaderships already have a good idea of what concessions they're prepared to make to make a deal happen. For all their rhetoric, John Boehner and Mitch McConnell at least seem to understand that the debt ceiling is real and has to be raised one way or another, if only because they don’t want to hand Obama his second term by being the party that helped wreck the global economy (again), or at the very least prevented Social Security cheques from being mailed. Everything leading up to that over the next two weeks will be a matter of details and grandstanding.
Then again, that depends on which the GOP leadership considers to be the bigger political risk – forcing the US govt to default on its interest payments as a matter of principle, or crossing the Tea Party by compromising on anything.
It’s always possible Boehner and McConnell are telling themselves, “Well, if we default, we default – we can always pin the rap on Obama somehow – marks will believe anything that follows that narrative, and anyway, last thing we need is for the economy to get better with Obama in charge – we’d never hear the end of it, AJ … and either way we’ll need all hands on deck to take on Obama, and we don’t want the Tea Party taking their act solo when we need ‘em, see what I mean?”
Or not.
Either way, by August 3 we’ll know where the GOP really stands with the Tea Party, to say nothing of the rest of the country.
Put up or shut up,
This is dF
Or something.
So what does it all mean? What will happen? And what’s the best economic plan that everyone should settle on?
Hell if I know. Ask an economist.
Seriously. I have no real wisdom on this, except for the really obvious point that, on a macro level, what we’re witnessing is the usual political game of Chicken, where Something Terrible will happen unless a deal is hammered out, and both the GOP and the Democrats in Congress have been betting large on all-or-nothing propositions in an effort to score as many political points as possible before eventually settling up on a compromise designed so that each party can claim to take credit for whatever works and blame everything else on the opposition.
The wild card, of course, is the Tea Party contingent that is so desperate to stick to their Small-Govt-Smaller-Budget mantra that they're convinced the debt ceiling is just something liberals made up to scare Americans into paying more taxes, and are urging the rest of the GOP not to fall for Obama’s Evil Plan to enslave America by elevating the debt ceiling to infinity.
Or something.
Anyway, here are the three (3) most sensible things I’ve read about the current state of things:
1. This article from The Economist.
2. This thought piece from John Scalzi.
3. This column from John Avlon.
They’re all critical of the GOP, yes. Even The Economist, which has never liked Obama’s fiscal policies to date. Which should tell you something.
All I can really add is that, for all my reputation as a dour pessimist, I think Congress will cut a deal at the last minute, and I think both party leaderships already have a good idea of what concessions they're prepared to make to make a deal happen. For all their rhetoric, John Boehner and Mitch McConnell at least seem to understand that the debt ceiling is real and has to be raised one way or another, if only because they don’t want to hand Obama his second term by being the party that helped wreck the global economy (again), or at the very least prevented Social Security cheques from being mailed. Everything leading up to that over the next two weeks will be a matter of details and grandstanding.
Then again, that depends on which the GOP leadership considers to be the bigger political risk – forcing the US govt to default on its interest payments as a matter of principle, or crossing the Tea Party by compromising on anything.
It’s always possible Boehner and McConnell are telling themselves, “Well, if we default, we default – we can always pin the rap on Obama somehow – marks will believe anything that follows that narrative, and anyway, last thing we need is for the economy to get better with Obama in charge – we’d never hear the end of it, AJ … and either way we’ll need all hands on deck to take on Obama, and we don’t want the Tea Party taking their act solo when we need ‘em, see what I mean?”
Or not.
Either way, by August 3 we’ll know where the GOP really stands with the Tea Party, to say nothing of the rest of the country.
Put up or shut up,
This is dF
