This honestly has to be one of the dumbest ‘crises’ we have ever been in. After a series of arbitrary dates determined by short term, kick-the-can down the road fixes set by Congress, we have once again reached the debt ceiling. Once again the GOP is demanding considerable spending cuts in exchange for agreeing to raise the limit, and once again Barry doesn’t think he has to entertain the idea. Timmy G’s “extraordinary measures” are fast becoming the norm.
But the reality is that we aren’t in a crisis at all.
We aren’t facing a crisis in the way that Greece is. We don’t have people rioting in the streets. We don’t have 25% unemployment. Despite Congress’s all-time low approval ratings, most of its members were reelected last fall. Treasury yields are at all time lows. The dollar is strong.
While it’s true that there is definitely a long-term problem that needs to be fixed, is it really necessary to threaten default over the matter? What happened to passing an annual budget, and arguing about it then, like we used to?
I applaud the Republicans’ efforts to attempt to address the spending problem this country has before it can become a legitimate issue like it has in Europe. But where was the fiscal restraint a decade ago when they were planning a 9-year war of choice? It’s not like this problem has really just appeared overnight.
What truly concerns me though is not the fact that there exists an unsustainable tax/spending imbalance. It’s the fact that our elected leaders are doing such poor job of putting together a long-term solution, any kind of a long-term solution. That’s the real crisis. I’m sure that if Greece left the Euro, or whatever, three years ago, everybody would be well on their way to picking themselves up and moving on by now. Just like how things were terrible during the financial crisis, they have become better since then. It’s like eating a bad burrito. All you can do is power through it and poop it out. But this whole mess has been pointlessly dragged out for far too long.
Uncertainty is what is holding our country back. It’s not the actual effect of slightly higher taxes on a few rich people. It’s not the actual entitlement cuts themselves. It’s not the new regulations themselves. It’s the fact that we can’t make future plans or investment decisions because we don’t know what to plan for. That’s why companies are just sitting tight and hoarding cash. If the solution is higher taxes, so be it. We will all figure out a way to cope with that, as we always have. But if we don’t know what is coming, we have no way of planning for it.
So in that way, the biggest threat to the U.S. is that we are going to become Europe. Not in the sense that we will have pointlessly high taxes, huge government, and overburdening regulations. But more in the sense that our leaders will become even more spineless than they already are, becoming ever more dependent on late-night bargains that delay the day of reckoning.
I think that’s why Ron Paul has such a following. He might be an old coot with gold bars buried in his backyard, but at least he stands for something. No solution will make everybody happy, but something is better than nothing. What will it take to come up with a solution to the real crisis?