Monday, October 21, 2013

Break Out the Champagne, Everyone! The Fiscal Crisis is Over!

Gosh, I was so worried when the federal government was shut down. It was nerve-wracking. I don't know about you, but all of the stores here in California were closed, there was no electric power, and someone ran over an endangered swamp mollusk on the 101 to San Jose.

Thank goodness that crisis is over! Jon Gabriel explains:

The D.C. press corps was giddy last night, declaring that the fiscal crisis had ended. Senators praised "honorable friends" from "great states," congressmembers gave standing O's to their stalwart leaders, and the president saluted bipartisanship while ridiculing Republicans, bloggers, activists and pretty much anyone else who dared oppose him.

If the whole thing seemed a bit surreal, it's because the whole thing was a bit surreal. America's fiscal crisis is not that our debt ceiling isn't quite high enough — it's that we have too much debt.

It's as if I had $250K in credit card debt and I told my wife, "Great news, honey — our fiscal crisis is over! I just got a new Visa!" If she didn't hit me over the head with a rolling pin, she would most assuredly tell me where I should place it.

To help visualize how up the creek we find ourselves, I created [the] infographic [at right]...

...When a conservative hesitates before raising the debt ceiling, he's portrayed as a madman. When Paul Ryan offers a thoughtful plan to pay down debt over decades, he's pushing grannies into the Grand Canyon and pantsing park rangers on the way out.

Forget sustainable — how is this sane?

In today's Wall Street Journal, renowned money manager Stanley Druckenmiller pilloried the catastrophic irresponsibility of the president when it comes to the nation's finances:

...this president, despite what he says, has shown time and time again that he needs a gun at his head to negotiate in good faith. All this talk about, 'I won't negotiate with a gun at my head.' OK, you've been president for five years."

His voice rising now, Mr. Druckenmiller pounds his fist on the conference table. "Show me, President Obama, when the period was when you initiated budget discussions without a gun at your head."

Druckenmiller is more optimistic than I am.

He says that America's debt-to-GDP ratio, which is the amount of debt the country has compared to all the goods and services it produces, will hit the Greece level of collapse by 2030. I personally don't think we have nearly that long. When the system becomes imbalanced, chaos and fear trump rationality.

If you're a Democrat, I want you to remember that sentence. Be sure and tell your kids and grandkids what you did to destroy their futures.

Hat tip: BadBlue News.


Anonymous said...

That swash of red perfectly profiles the deepest largest hole in the world - that pit out in Siberia.

JonRobert said...

Doesn't look like annual deficits accumulate to the aggregate debt.

IS there another increment, like unrealized obligations of OASDHI?