Thread: Economics Cliff deal reality moment
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Old 01-05-2013, 11:16 AM   #27
Comrade Crapski Comrade Crapski is offline
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Join Date: Mar 2012
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The politics of the “fiscal cliff” deal is debatable: On the one hand, Boehner got the “Bush tax cuts” made permanent for most Americans; Obama was forced to abandon his goal of increasing rates for those earning $250,000. On the other, on taxes Republicans caved to the same class-warfare premises (the rich need to pay their “fair share”) they’d successfully fought off a mere two years ago; while on spending the Democrats not only refused to make cuts, they refused to make cuts even part of the discussion.

Which of the above is correct? Who cares? As I said, the politics is debatable. But the reality isn’t. I hate to keep plugging my book After America in this space, but if you buy multiple copies they’ll come in very useful for insulating your cabin after the power grid collapses. At any rate, right up there at the front — page six — I write as follows:

“The prevailing political realities of the United States do not allow for any meaningful course correction. And, without meaningful course correction, America is doomed.”



Washington keeps proving the point. The political class has just spent two months on a down-to-the-wire nail-biting white-knuckle thrill-ride negotiation the result of which is more business as usual. At the end, as always, Dr. Obama and Dr. Boehner emerge in white coats, surgical masks around their necks, bloody scalpels in hand, and announce that it was touch and go for a while but the operation was a complete success — and all they’ve done is applied another temporary band-aid that’s peeling off even as they speak. They’re already prepping the OR for the next life-or-death surgery on the debt ceiling, tentatively scheduled for next Tuesday or a week on Thursday or the third Sunday after Epiphany.

No epiphanies in Washington: The Congressional Budget Office estimates that the latest triumphant deal includes $2 billion of cuts for fiscal year 2013. Wow! That’s what the government of the United States borrows every ten hours and 38 minutes. Spending two months negotiating ten hours of savings is like driving to a supermarket three states away to save a nickel on your grocery bill.

A space alien on Planet Zongo whose cable package includes Meet the Press could watch ten minutes of these pseudo-cliffhangers and figure out how they always end, every time: Spending goes up, and the revenue gap widens. This latest painstakingly negotiated bipartisan deal to restore fiscal responsibility actually includes a third of a trillion dollars in new spending. A third of a trillion! $330,000,000,000! Fancy that! In most countries, a third of a trillion would be a lot of money. But in the U.S. it’s chump change so footling it’s barely mentioned in the news reports.

Then there’s the usual sweetheart deals for those with Washington’s ear: $59 million for algae producers, a $20 million tax break if a Hollywood producer shoots part of a movie in a “depressed area” as opposed to a non-depressed area, like Canada. I’m pitching a script to Paramount called “The Algae That Ate Detroit.”

In all the “fiscal cliff” debate, I don’t recall a lot of discussion of algae. But apparently it’s essential to the deal. And don’t worry, it’s paid for by all the new revenue — an estimated $620 billion over a decade, or about $62 billion a year, which is what the government of the United States borrows every 13 days. But don’t worry, that’s a lot of algae.

We’re already broker than anyone has ever been ever. But this is America, where we can always do better — or anyway bigger, and broker: Under the “deal,” the federal debt of the United States in 2022 is officially projected to be $23.9 trillion. That’s in today’s dollars, as opposed to whatever we’ll be loading up the wheelbarrow with in 2022. With “deals” like this, who needs total societal collapse? By 2050, the federal debt will be $58 trillion. But you won’t have to worry about a United States of America by then: It’ll just be one big abandoned Chevy Algaerado plant.

Around the world, the only interest of friends and enemies alike in this third-rate Beltway hokum is (to return to the theme of my book) the question of whether America is capable of serious course correction — and, from debt ceiling to supercommittee to fiscal cliff and now back to debt ceiling, the political class keeps sending back the answer: No, we’re not. For a good example of how Washington drives even the greatest minds round the bend, consider Charles Krauthammer’s analysis on Fox News the other night:

“I would actually commend Boehner and Paul Ryan, who in the end voted ‘yes’ for a bad deal. But they had to do it.”

If courage is the willingness to take a stand and vote for a bad deal because you’ve been painted into a corner and want Obama to fly back to Hawaii at the cost of another $3 million in public funds that could have gone to algae subsidies so he’ll stop tormenting you for a week or two, then truly we are led by giants.

But is that all there is? As the old song says: What’s it all about — algae? Is it just for the moment we live? What’s it all about when you sort it out — algae? Are we meant to take more than we give?

If you think politics is a make-work project for the otherwise unemployable, then the system worked just fine. And I don’t mean only the numbers: On Monday, 300 million Americans did not know what their tax rates would be on Tuesday. That’s ridiculous.

Then the Senate minority leader Mitch McConnell spent the night alone in a room with Joe Biden (which admittedly few of us would have the stomach for). And when they emerged they informed those 300 million Americans what their tax rates now were. That’s unseemly.

http://www.nationalreview.com/articl...ge-mark-steyn#
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