debt ceiling Kabuki update
 

I used to think that pro wrasslin' was the only genuinely original American theater form, but it's become clear to me that debt-ceiling wrangling is another ... highly ritualized, lots of stomping around on stage and glowering ... as I've mentioned before, I like to call it "debt ceiling [url=http://en.wikipedia.org/wiki/Kabuki]Kabuki[/url]". (I can't help but have this image of John Boehner in full Kabuki-style [url=http://upload.wikimedia.org/wikipedia/commons/thumb/0/0e/Toshusai_Sharaku-_Otani_Oniji%2C_1794.jpg/220px-Toshusai_Sharaku-_Otani_Oniji%2C_1794.jpg]face makeup[/url] and samurai regalia, angrily snapping his fan at Obama and stomping out of the latest crisis meeting at the white House.)

My bottom line: USGov is broke-and-more, the debt ramping-up has been busily ongoing for 30 years and is thoroughly bipartisan (Obama has added as much in just 3 years as Dubya in a full 8, btw - but of course Obama 'inherited all these problems', blah, blah). There is no way any of that debt is ever gonna be repaid - at least not in dollars that are worth anything near what those originally provided by the lenders were. Neither party has a clue (nor really any desire) to make the needed cuts in any of their precious pet govt-welfare programs (Dems: SS and Medicare, Reps: Tax breaks for the rich, Both Sides: Defense), so let's just get it over with an default already, cut up the federal credit card, and take the pain that's coming as a result of our multidecadal profligacy. The pain is unavoidable, but the longer the PTB try to out it off in their desperate quest for a free-lunch magical fix, the worse it's gonna be and the longer it's gonna last.

I mean, really: The most delusionally-optimistic 'plan' anyone has proposed claimed to cut an impressive-sounding $4 trillion over 10 years ... only 20-25% of our current debt-issuance rate (which is between 1.6-2 trillion per year). Not even close to getting back to balance (much less running the actual surpluses which would be needed to actually start paying down the massive pile of debt), and the CBO quickly exposed the numbers as hocus-pocus anyway [see link below]. Obama says he doesn't like any of the Rep. plans, yet has proposed no plan whatsoever of his own. None. Zero, zilch, nada. Pathetic.

Regarding the various debt-reduction proposals that have been floated, Mish has this nice summary of the latest "plans" - Note Mish is a bit of as goldbug, though he’s certainly right that gold is likely a better place to be than stocks these days:

[url=http://globaleconomicanalysis.blogspot.com/2011/07/rating-obama-reid-and-boehner-deficit.html ]Rating the Obama, Reid, and Boehner Deficit Reduction Plans on Mish's 10-Point Credibility Scale[/url]

But the real question of the week is: Will any of the Big 3 ratings cartels have the guts to do the right thing and downgrade the US, irrespective of whether some silly "temporary agreement to pretend we will actually try to get our budget house in order but first extendify the debt ceiling, blah blah" is reached at the 11.99th hour, as we all know it will be?

Michele Bachmann's Holy War
 

And in case the DC Kabuki gets too strident for you, here is Matt Taibbi`s latest piece - admittedly only peripherally related to the thread topic, by way of the Tea Party theme -- But I can't help wondering if Ms. Bachmann believes that organized mass-scale prayer could help fix the national-debt situation. ("Pray as you go" budgeting, to abuse a common fiscal-hawk pet phrase.)

[url=http://www.rollingstone.com/politics/news/michele-bachmanns-holy-war-20110622]Michele Bachmann's Holy War[/url]: [i]The Tea Party contender may seem like a goofball, but be warned: Her presidential campaign is no laughing matter[/i]
[quote]It may be the hardest thing you ever do, for Michele Bachmann is almost certainly the funniest thing that has ever happened to American presidential politics. Fans of obscure 1970s television may remember a short-lived children's show called Far Out Space Nuts, in which a pair of dimwitted NASA repairmen, one of whom is played by Bob (Gilligan) Denver, accidentally send themselves into space by pressing "launch" instead of "lunch" inside a capsule they were fixing at Cape Canaveral. This plot device roughly approximates the political and cultural mechanism that is sending Michele Bachmann hurtling in the direction of the Oval Office.

Bachmann is a religious zealot whose brain is a raging electrical storm of divine visions and paranoid delusions. She believes that the Chinese are plotting to replace the dollar bill, that light bulbs are killing our dogs and cats, and that God personally chose her to become both an IRS attorney who would spend years hounding taxpayers and a raging anti-tax Tea Party crusader against big government. She kicked off her unofficial presidential campaign in New Hampshire, by mistakenly declaring it the birthplace of the American Revolution. "It's your state that fired the shot that was heard around the world!" she gushed. "You are the state of Lexington and Concord, you started the battle for liberty right here in your backyard."
...
[Her] background is significant considering Bachmann's leadership role in the Tea Party, a movement ostensibly founded on ideas of limited government. Bachmann says she believes in a limited state, but she was educated in an extremist Christian tradition that rejects the entire notion of a separate, secular legal authority and views earthly law as an instrument for interpreting biblical values. As a legislator, she not only worked to impose a ban on gay marriage, she also endorsed a report that proposed banning anyone who "espoused or supported Shariah law" from immigrating to the U.S. (Bachmann seems so unduly obsessed with Shariah law that, after listening to her frequent pronouncements on the subject, one begins to wonder if her crazed antipathy isn't born of professional jealousy.)[/quote]

Tea Party "Hobbits"
 

[QUOTE=Zeta-Flux;266857]Claiming that the GOP is acting out of ideological purity rather than reality (and by implication, without concern for the country) is just poison to the conversation (and untrue).[/QUOTE]From one still-in-business Murdoch rag:

"The GOP's Reality Test

Republicans who oppose Boehner's debt deal are playing into Obama's hands."

[URL]http://online.wsj.com/article/SB10001424053111903591104576470061986837494.html?mod=WSJ_Opinion_LEADTop[/URL]

(with my emphasis)

[quote]. . .

Strangely, some Republicans and conservative activists are condemning this as a fiscal sellout. ...

... [B]The idea seems to be[/B] that if the House GOP refuses to raise the debt ceiling, a default crisis or gradual government shutdown will ensue, and the public will turn en masse against . . . Barack Obama. [B]The Republican House that failed to raise the debt ceiling would somehow escape all blame.[/B] Then Democrats would have no choice but to pass a balanced-budget amendment and reform entitlements, and [B]the tea-party Hobbits could return to Middle Earth having defeated Mordor.[/B][/quote]Hey, the [U][I]Wall Street Journal[/I][/U] said it ... probably without having first read any of my posts in this or another thread.

Is that just some Murdoch poison ... or is it just that the [I]WSJ[/I] knows the difference between fiscal ideology and fiscal reality, too?

[QUOTE=Zeta-Flux;267698]Just make sure to blame all of the Democrats' faults on the Republicans. Then it isn't their fault after all![/QUOTE]Yes, that's one way to weasel out of acknowledging Republican faults -- saying that they're really Democratic faults that are just being blamed on those innocent Republicans (and be sure to throw in the "all" strawman so that you inflate a statement about only [I]some[/I] faults into an imaginary inflated statement about "all" faults that makes a much easier target than what the person you're responding to actually said).

I guess the [I]WSJ[/I]'s spellchecker must've exchanged "Republican" and "Democrat".

When you don't realistically admit (without strawman exaggeration) that Republicans really, truly made some mistakes, then your excuses look just as one-sidedly ideological as the "Hobbits".

[QUOTE=cheesehead;267721]When you don't realistically admit (without strawman exaggeration) that Republicans really, truly made some mistakes, then your excuses look just as one-sidedly ideological as the "Hobbits".[/QUOTE]I can't begin to express the irony I see in this statement.

[QUOTE=Zeta-Flux;267733]I can't begin to express the irony I see in this statement.[/QUOTE]Oh. ... Well, when you [i]can[/i] begin to express it, will you please do so, so that we don't have to guess wrong about your meaning? I'd hate to think that all you have in mind is another evidence-free word-mimicry with "Democratic" substituted for "Republican".

[QUOTE=ewmayer;267709]My bottom line: USGov is broke-and-more, the debt ramping-up has been busily ongoing for 30 years and is thoroughly bipartisan (Obama has added as much in just 3 years as Dubya in a full 8, btw - but of course Obama 'inherited all these problems', blah, blah). There is no way any of that debt is ever gonna be repaid - at least not in dollars that are worth anything near what those originally provided by the lenders were. Neither party has a clue (nor really any desire) to make the needed cuts in any of their precious pet govt-welfare programs (Dems: SS and Medicare, Reps: Tax breaks for the rich, Both Sides: Defense), so let's just get it over with an default already, cut up the federal credit card, and take the pain that's coming as a result of our multidecadal profligacy. The pain is unavoidable, but the longer the PTB try to out it off in their desperate quest for a free-lunch magical fix, the worse it's gonna be and the longer it's gonna last.[/QUOTE]If I was reasonably sure that the pain would be inflicted only on the US I would support your proposal unreservedly.

Unfortunately, the rest of the world is going to take a big hit as well. Should we take the hit all at once or spread over a few years? Ay, there's the rub.

Paul

[QUOTE=ewmayer;267709]

<snip>

so let's just get it over with an default already, cut up the federal credit card, and take the pain that's coming as a result of our multidecadal profligacy. The pain is unavoidable, but the longer the PTB try to out it off in their desperate quest for a free-lunch magical fix, the worse it's gonna be and the longer it's gonna last.

[/QUOTE]

Yep. For the time being I have pulled my entire IRA/401K out of the
stock market. I maintain a position in REITS and in some bond funds
but I have pulled out of all equities. I will rethink my portfolio in a month
or so. I will probably put a much higher percentage into precious metals.

[QUOTE]

I mean, really: The most delusionally-optimistic 'plan' anyone has proposed claimed to cut an impressive-sounding $4 trillion over 10 years ... only 20-25% of our current debt-issuance rate (which is between 1.6-2 trillion per year). Not even close to getting back to balance

[/QUOTE]

Amen! We should be making cuts in the 7-8e12 range. But congress
lacks the courage. We should shut down the so-called "wars" in IRAQ
and Afghanistan completely. We should close AT LEAST half of our
overseas military bases [yeah. good luck with that]. Raise the
minimum age for FICA from 62 to at least 65. Raise the minimum age
for full FICA benefits to at least 68. FICA is collected separately
from FIT. Let's pass a law forbidding Congress from using the FICA
fund from any other purpose. FICA is currently a regressive tax.
The more one earns (once the full amount is paid), the lower the percentage
of one's income is taxed. Let's get rid of the ceiling.

To do something about Medicare, we need to do something about underlying
health care costs. We need to stop heaping large amounts of money
on people who are hopelessly ill. Care for them, yes. But "Life at all costs" is
unaffordable. Strangely, the Republitards who most want to reduce Medicare
costs have the attitude of the religious "right to life" crowd. This crowd
wants to keep people alive as long as possible regardless of the cost. i.e.
you can't "pull the plug".


We need [b]tort[/b] reform so that doctors can stop practicing
defensive medicine. The old addage about an "ounce of prevention"
is applicable. To bring down Medicare costs we have to bring down
medical costs in general. I have a real proposal: Just as the intelligent
among us insure our automobiles against getting hit by someone who
has no insurance, let [i]individuals[/i] buy medical malpractice insurance
instead of doctors. i.e. if I am going to have surgery, I will buy my own
insurance gainst the doctor making a mistake instead of relying on my
right to sue. This would relieve doctors of having to practice defensive
medicine against possible lawsuits. --> cut down on unnecessary tests.

[QUOTE]

But the real question of the week is: Will any of the Big 3 ratings cartels have the guts to do the right thing and downgrade the US, irrespective of whether some silly "temporary agreement to pretend we will actually try to get our budget house in order but first extendify the debt ceiling, blah blah" is reached at the 11.99th hour, as we all know it will be?[/QUOTE]

I doubt it.

Too high a percentage of the taxes we pay goes to paying interest on
the debt. If we brought down the debt to zero, the money that [i]is[/i] collected
would all go directly to programs and infrastructure. This would result
in our ability to lower taxes as the Republicans want, because we would not
be wasting what is collected on paying interest.

[QUOTE=R.D. Silverman;267753]

<snip>

.[/QUOTE]

I have a comment and an interesting rhetorical question.

Most of us (I would hope) are willing to make economic sacrifices
for ourselves so that our children will benefit. I am currently putting
my three children through college. I spend almost nothing on myself.
I have not had a vacation in about 5 years. Every cent that I can
scrape up goes to paying their tuition. (Although I do continue to
make some 401K contributions).

Why then is society unwilling to make COLLECTIVE sacrifices for the benefit
of the next generation? Noone seems willing to give up anything. We have
a collective NIMBY mentality when it comes to budget cuts. Everyone wants
cuts, but only "for the other guy".

[QUOTE=R.D. Silverman;267755]I have a comment and an interesting rhetorical question.

Most of us (I would hope) are willing to make economic sacrifices
for ourselves so that our children will benefit. I am currently putting
my three children through college. I spend almost nothing on myself.
I have not had a vacation in about 5 years. Every cent that I can
scrape up goes to paying their tuition. (Although I do continue to
make some 401K contributions).

Why then is society unwilling to make COLLECTIVE sacrifices for the benefit
of the next generation? Noone seems willing to give up anything. We have
a collective NIMBY mentality when it comes to budget cuts. Everyone wants
cuts, but only "for the other guy".[/QUOTE]

Further observation/question. Is the current debt reduction mess a prime
example of the "tragedy of the commons"???? It does seem that way.

[QUOTE=R.D. Silverman;267755]I have a comment and an interesting rhetorical question.

Most of us (I would hope) are willing to make economic sacrifices
for ourselves so that our children will benefit.

<snip>

[/QUOTE]

Some of us, (one Tea Bagger Republican in particular) are [b]not[/b] willing
to make such sacrifices. See:

[url]http://www.huffingtonpost.com/2011/07/28/joe-walsh-sued-for-100000_n_911800.html[/url]

So much for "family values"