Political pundits and policy wonks may understand the "Art of Political Sausage-Making," but, to average Americans it may as well be like trying to learn speaking Mandarin. To the Average Joe, instant gratification will always win out over some nifty policy creation that doesn't enhance their lives or kick in until 2014. Let's face it, Joe may be dead before then. So, is it any wonder, then, that the sausage-making process is just something most could care less about?
Not that they should ignore it, but for the most part - people do.
The latest crisis centers on the National Debt and Spending. Yes, average people are paying attention to that all of a sudden - but not because of the long term ramifications of any deficit policy which would rein in the spending down the line. No sir - it is because if a deal isn't struck by August 2nd, according to President Barack Obama, then he isn't sure if he can guarantee that Social Security recipients would receive their benefits.
Hey Now - that has just become an immediate concern!
And I assure you most people could care less about their political principles, or the lack thereof. They want their Social Security Checks - period. But, I don't think people realize that this game of political chicken, at least at this time, is far more dangerous than when President William Clinton and Newt Gingrich butted heads. At that time, the Federal Reserve had far many more mechanisms and levers to pull to ease fears of an eminent default. Unfortunately, that is not the case today.
Our economy today that has no such buffers. Interest Rates are far too low for that. Adding to that, we also have high unemployment while corporations remain operating at diminished capacity, if at all. Business just can't expand, even with interest rates ripe for capital expansion. Besides, why would business want to build more factories when the one's they have are already half-utilized, if at all? At least when Clinton and Gingrich locked horns - the economy was running at a high capacity and employment levels high.
Although it pretty much takes a Rhodes Scholar to figure out the net effects of any government policy, and the process behind it, most people are smart enough enough to know that this isn't the time to make an ideological stand. If the USA defaults on its obligations, it will have long-term and far-reaching consequences. And not just in the United States! In spite of our lackluster economy, America is still depended upon by other nations when it comes to trade. Losing America's market presence would devastate the global economy. And that is exactly what would happen.
As I said in my earlier post, if politicians are concerned now about a stubbornly high unemployment rate, well, then keep playing this game and force President Obama into not backing down and defaulting. Obama is smart enough to know that whether he capitulates, or not, politically he is damaged. So, if he does decide to default, then unemployment will skyrocket, the markets will crash and inflation will rise rapidly. And again, I will say this with all candor - all politicians involved in this stalemate will suffer a backlash by an irate constituency.
Just to be clear here, though. There is no question that reining in government spending must be addressed and that the problem be solved. However, allowing the country to default will not accomplish that, nor would the pain of it be short-lived. Anyone needing a quick reminder as to what a misguided government policy can do - just look back to Japan in the 1990's. They still haven't recovered!
At the same token, though, I find it hypocritical that the Tea Party Caucus, led by Eric Cantor would oppose taxing say "corporate jets" than playing ball with the president when he was willing to raise the retirement age to sixty-seven. Talk about principles? It is pretty obvious what is going on here. As I have said before, the GOP, and the Tea Party Caucus in particular, have a twisted perspective. And those who wholeheartedly believe in their rhetoric will eventually feel the pains of that folly. What started as a populist movement without regard to political ideology, the premise of that movement was hijacked by an extreme faction of the GOP whose only intent is to make the rich, richer. It is too bad that people have been duped into thinking that these candidates were on the peoples side. They were not!
The Tea Party, as constructed today, is about redistributing wealth to the upper 2-5% of the population and keep them from paying their fair share of taxes. Personally, I don't think it is fair to keep allowing the wealthy to dump their money into off-shore tax shelters while leaving the burden to the little guy. So, it certainly was not about protecting the "Taxed Enough Already" Middle Class, whom they are now trying to wipe out. Quite frankly, the TEA Party is as dangerous as Hitler was when he convinced unsuspecting Germans that building the Autobahns was for something other than his Grand Plan of rolling Panzer's across neighboring borders.
Believe me, this is an observation from someone who was "all-in" with the Tea Party when it began. However, after watching their methodical moves to wipe out labor, which would destroy what is left of the American Middle Class, and then refusing to enact equitable tax reforms on the wealthy should tell you something. So then, who are the GOP / Tea Party protecting? It certainly isn't the Middle Class.
And if you think I am kidding, then wait until those who support the Tea Party realize that they too have been deprived of their safety net. When you consider the zealousness by which the GOP has been trying to push privatizing retirement funding while holding on to the idea that a free market will provide, is somewhat misguided. All you have to do is take a look around and you will see what the financial markets has already unleashed upon us with their greed. Haven't many people already lost large sums in their portfolios, or am I missing something here? Besides, hasn't Old Age privatization already shown us it could fail on the whims of the market? If I recall, that is exactly what happened during Latin America's debt crisis of the 1980's. Look nothing is fail-safe when you rely on the financial markets. We need to strike a balance.
Are there lessons to be learned when it comes to privatization? Sure there are, and they should be vigorously and diplomatically debated. After all there are two distinct schools of thought on the issue. And I certainly understand that privatization, at least in theory, should offer a greater return on the investment. But then again, I must point back to the meltdown of our financial markets. At the end of the day, that has directly led to, and exasperated, the current economic woes we face.
Never the less, nothing ever gets better, let alone solved, because our lawmakers continue to refuse to compromise in good faith. And as I have said over and over again, yes, the National Debt must be addressed. But this isn't exactly the right time to hold America hostage.
But hostage she remains by a GOP bent on protecting the wealthy.
What a Disgrace!
Tags: Democrats, Economy, Global Economy, Government, Government Policy, Headline News, News and Opinion, Op Ed, Politics, President Barack Obama, Republicans, Social Security, Tea Party, US Debt Crisis