The government has reached its legal debt limit of $ 14.3 trillion dollars. In order to continue to function financially, if Congress does not raise the debt limit, it must now borrow, temporarily, money from pension contributions it would have made to federal pensions. This would give the United States enough money to pay her bills for 11 weeks. After this, the United States must choose between paying Social Security checks, Medicare and Medicaid, government workers and the military, etc. or her bond obligations. Failure to meet timely bond payments all are predicting would have devastating consequences.
Of course, this is all political show. The government’s looming shut down as it is called must end at a point and the government must open its doors for business again. However; President Obama wants to keep spending money at a gargantuan pace and the Republicans are insisting that before they raise the debt limit $ 2 trillion as asked, enough to last until after the 2012 elections, $ 2 trillion dollars in budget cuts must be made. The only leverage either have is which way voter anger will go.
By right, ( I will discuss in reality, in a moment) since the Congress controls the purse strings, it should be directed at the Congress. When the government is shut down, the circumstances have to be looked at. Has a budget been approved already? If so, does the Congress have an obligation to fund what was approved, even if by another Congress?
If this dealt with the President vetoing a budget that he did not like because of differing political temperaments between the Congress and the President, and a crisis ensuing because of this, then the President is the irresponsible agent. He is so because the Executive has shut down the government, interfering with Congress’s Constitutional duty to approve a new budget. After all, this is why there is a separation of powers.
But reality is different. The media will support the President since it all but coroneted him before the last election. There are those who listen to only CBS or MSNBC and garbage in will equal garbage out. Also, the Executive branch will make sure to close parks, monuments and museums for tourists discomfort before it simply shuts down stupid programs that people actually don’t want for more money to generate vote anger. It will also use the fear card to stir those who count the days to their next government hand out, whether a rich multinational or the millions who depend on government redistribution policies.
The Republicans are in a tight corner though. The last compromise they made with the Executive Branch about a supposed $ 38 billion in budget cuts before they would raise the debt ceiling infuriated people truly frightened by the cost of government as being to little. They cannot survive politically another base voter betrayal from conservatives who feel that they have been marginalized for decades. Break glass and bring out on election then scorn afterwards.
Which way will the voter anger turn? It should be so horrified at the excesses of government that voters should back any sane plan to cut spending. However; as a random person once said to me in the truest wisdom I ever heard, “You can never discount the stupid vote.” Or the stupid citizen.
Jeffrey Ruzicka is a retired executive of a small company that specializes inindustrial water treatment. He lives happily with his wife in Western Pennsylvania and is a contributing writer toFinancialJobBank,FinancialJobBankBlog and Nexxt.