Now that the government shutdown/debt limit standoff has been resolved, for now, the nation can proceed on three fronts. First, the people who do the actual work in the federal government, as opposed to the politicians who make a living primping, preening, and posing for the media, can get back to work. Second, the U.S. Treasury is “good for it” for a little while. Third, yours truly has some comments, and hopefully some insightful comments, on the whole imbroglio.
One of the great things about being a cynic is that it allows one to overcome one’s former partisan leanings and look at political issues from a more objective perspective. Cynicism leads one to loathe, or at least find both amusing and deeply troubling at the same time, politicians of both parties. Being able to find very little, if anything, good in either party, we cynics can look at issues from a nearly non-partisan, nearly non-ideological standpoint, to wit…
First, the most obvious flaw with this deal is that it is only temporary. The government will be “reopened” until January 15 and the debt ceiling will be suspended through February 7. With the shell game tactics that the deal allowed the Treasury secretary to continue to employ, we should be able to avert another default until early March. Oh, joy. This temporary fix will allow the poltroons and popinjays on the Hill and in the White House time to negotiate. Allowing the likes of Paul Ryan and Patty Murray more time to posture and pontificate is supposed to bring us relief. O tempora, o mores!
One does not have to be too cynical to suspect that the narcissists in Washington are prolonging this soap opera because they crave the attention; see my 10/11/13 piece, THE DEBT CEILING“CRISIS”: “HE WANTED TAN SHOES AND PINK SHOELACES, A POLKA DOT VEST AND MAN, OH MAN!”)
Second, the GOP does look like something of a traveling freak show after a massive deluge, an earth jarring earthquake, and a series of tornadoes at this stage. But it is untrue that the Republicans came out of this with no victories whatsoever. Recall that, earlier this week, the Democrats, feeling their oats, started making demands about rolling back the scheduled sequester cuts due to be implemented in January. They quickly fell back from that position when it looked like insistence on rolling back the sequester would nearly certainly result in default. So the GOP did achieve a small victory, along with tightening eligibility verification procedures for those receiving subsidies under the Affordable Health Care Act, or ObamaCare. It’s certainly not much, and the GOP is looking quite ragged at this stage, but it’s not as if the GOP achieved nothing, as the media would have you believe.
Third, one of the early, and quickly abandoned, goals of the tea partiers was the postponement, or the elimination, of the ObamaCare requirement that that individuals buy health insurance. As the Wall Street Journal put it this morning (Thursday, 10/17/13 , page A6):
They (participants at the “Conversations with Conservatives” confab at the Heritage Foundation) continued to argue that the law (the Affordable Health Care Act) is unfair, and restated their goal to shield individuals who don’t buy insurance from a penalty that kicks in next year. (Emphasis mine)
Yours truly is no fan of ObamaCare, doesn’t like to be told to do anything, and has something of a libertarian conservative streak in him. However, protecting the right of people not to buy insurance, which is tantamount to protecting their right to welsh on their responsibilities and force others to pick up their health care expenses, does not seem like the most conservative of ideals to me. Is this what the tea partiers were fighting for? The right to shirk one’s responsibilities and force others to pay one’s bills? If this is true, where do I turn in my “conservative” card?
Fourth, the most enthusiastic “conservatives” in the tea party have to be asking themselves why they are Republicans. That they will get nowhere with the Republican Party, as it is currently constituted, is best illustrated by an odd, or perhaps intentional, juxtaposition of articles in today’s Wall Street Journal. On page 1 of today’s (Thursday, 10/17/13 ’s) paper, we saw two articles with the headlines “Congress Passes a Debt Bill” and “Business Voices Frustration with GOP.”
The GOP remains, for now, the party of business. It will take the votes and contributions of the social conservatives and of the genuine fiscal conservatives, but when the chips are down it will do the bidding of the Chamber of Commerce, and will ally itself with the Democrats to do so, as the House vote on yesterday’s deal showed. That was only the latest illustration of the true colors, for better or worse, of today’s GOP. Look, for example, at whom the party nominated as its presidential standard-bearer in 2012; what in the world does a guy like Mitt Romney have in common with a populist social conservative who is willing to have the Treasury default on its obligations, and thus risk financial catastrophe, to make a point about a nearly completely unrelated issue?
Either the tea partiers and their now social conservative allies have to take over the GOP and force the traditional Republicans out or the tea partiers and their social conservative allies have to form a third party. The two groups can’t realistically co-exist…unless the tea partiers are a bunch of chumps.
As a side note, the President’s speech this morning, gloating and kicking the Republicans while they were down, didn’t help increase the level of “civility,” or “the ability to legislate” either. Silliness and vanity are by no means exclusive to one party in Washington , despite what the media would have you believe.
Fifth, as much as those of us who genuinely favor a smaller government, and are nearly terrified by the rate at which the government is growing, would like to fantasize about it, there is no consensus, indeed very little enthusiasm among the populace for small government or even meaningful spending cuts. Sure, everyone wants to cut spending in the abstract, but what those who profess such desire (everyone) really mean is that they’d like to cut the spending that benefits someone else. No one wants his or her program even nicked, let alone eliminated. Look at the outcry over the government shutdown and the serial re-opening of government agencies and functions that suddenly became “essential,” “vital,” or “indispensable.” If we’d waited another week, every program would have been re-opened while the government remained on “lockdown.” Look at the understandable near panic at the prospect of the government’s missing that $50 billion social security payment on November 1.
Sadly, the American people, despite loud protests from some quarters about government’s reach and spending skyrocketing and seemingly out of control, have gotten very comfortable with big government, even creeping socialism. They not only like their share of the bounty that flows from Washington, but one also suspects that, deep inside, they like being told what to do. It makes life easier and enables one to get back to the business of acquiring crap one doesn’t need with money one doesn’t have to impress people one doesn’t like in a vain attempt to fill the gaping holes in one’s life.
Sixth, the world has to be shaking its head as it looks at once great America , having elected a cabal of mountebanks and charlatans to govern it, bringing itself to the brink of tarnishing, if not destroying, the credibility of the world’s bedrock credit and currency. Chinese talk earlier this week of “de-Americanizing” the world’s financial structure has to be falling on fertile ground.
What’s the alternative, one might ask? Right now, there may not be an alternative, though one suspects that when one looks at the German, British, and Japanese government bond markets, one has the makings of a realistic alternative, or set of alternatives (The last may not be a good candidate, given Japan’s fiscal problems; see my 9/13/13 piece ABENOMICS: HAVE THE GOVERNMENT CREATE A MESS AND THEN SPEND MONEY CLEANING IT UP for only my latest screed on Japanese fiscal mismanagement), and this is even before the Chinese bond market develops. At any rate, one suspects that the search has intensified in recent weeks for an alternative to the U.S. treasury market, and thus to the dollar, that has somehow put itself in a position of being at the mercy of the whims of a pack of poltroons and popinjays who feel allegiance to nothing so much as their own visages in the paper, on television, and in the mirror.
Maybe I’m wrong; Treasuries have caught a big bid today, with the ten year yield down to 2.60% as I write this. But gold and silver have also caught big bids today. And the dollar is down virtually across the board.
As I have said ad nauseam in the past, one can’t draw conclusions from one day’s trading. But yours truly’s enthusiasm for gold and silver, always present and always disproportionate, is only growing, as is my enthusiasm for foreign markets in general. And yours truly is far from alone.
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