Tuesday, July 26, 2011

Yes Virginia, There Is A Debt Crisis

Watched the Pres last night, followed by Speaker Boehner.  And dang, that caused me to miss Rey Mysterio winning the new WWE World Championship from The Miz.  I think the right guy won the match, and though I'm not sure about the specific details, it's almost a certainty how it ended.  The Miz is great on the mic, which carries a lot of weight in the wrestling world, as it should.  But lets face it, I love that masked wrestler and his patented, if vaguely superficial, 619 finishing move. 

Anyway, with the remaining wrestling matches on the tube, I looked on the web to see how the public took the political speeches.  MSNBC asked who we thought won their point; I was slightly surprised to find a great majority felt Obama made the best argument.  I would have guessed a fair split, but it was roughly 60-30-10.  I myself voted neither won, because I found flaws in both presentations, and this put me in the 10% group.  The story's online comments were divided by how one voted, and I looked up some of the comments of those who voted with me.  I agreed with the one who said Obama's was better, but both are guilty of "politics as usual."
What was troubling about these presentations was how they both made it clear that they agree disaster looms.  But at the same time, and much more importantly, it is the other side who is pushing us to the brink; and the other side that must move on their position.  Message decoded: we are very possibly going to default, and each party is snug (and smug) in the conviction it will be the others fault.  Almost like magic, the very thing most people agree must not happen, will happen, and no one will be to blame!  This is just preposterous.

To be sure, there are those who think this will not be a disaster, and apparently they are the Tea Partiers.  Do I detect a little "This is all alarmist crap.  It isn't the big deal the Pres says it is.  But, if default is really bad, it will serve those Democrats right for pushing us to this point."  If you tea-baggers really believe this, then you are nothing more than little kids playing with matches in the fertilizer shed.  It's one thing to burn yourselves; quite another to blow up the whole damn farm.

Let me tell you what's really going to happen.  I finally saw some numbers, and here they are:  $203 billion in receipts for August, $363 billion in obligations.  Wait a minute... WTF?  We're only going to take in about 56% of what we need to pay out?  Uh-oh...  since we're not going to print more money, SOMEBODY is not going to get paid...

Nobody knows for sure who doesn't get paid, but everything I've read says we'll pay debt interest first, to salvage our already suspicious credit standing with all our creditors.  The question is how to divide the remainder amongst the rest.  Who are the rest?  Well, anybody getting a check from Uncle.  Including all government contractors, those on Social Security, government salary, government retirement, medicaid, medicare, and so on.  Putting aside the absolutely astonishing and appalling thought that our all volunteer force servicemen and women currently at war might not get paid, let's just look at retirees. I am among these, and figure we are somewhat farther down the ladder.  I am already figuring how to cover next month's rent. 

If I can make the rent, I will be one of the lucky ones who was not living paycheck to paycheck, as so many are.  A lot of rent and mortgage payments are at risk, which puts banks at risk, which tightens credit, which stops growth and puts businesses already on the edge in a deeper fix, and so on.  So much of our economy rides on consumer confidence, and an intangible faith that there will be bread on the store shelf when we are ready to buy it.

So, what didn't I like about each speech?  Well the Pres seems hooked on this "we must tax the rich and corporations" thing.  Though I tend to agree with him (because I don't think that not raising their taxes will create more jobs; at least, it hasn't worked for the last 12 years), the actual increased revenue numbers appear to be a drop in the bucket; i.e., it's more symbolic than anything else.  President Obama, are you using this to to get working class America behind you and the Democratic platform for future elections?  Should it really be the deal-breaker?  It's true, businesses getting a tax break on a corporate jet is irksome.  But at least Americans built that jet.

And Speaker Boehner, you were almost folksy in your presentation.  You made it sound matter-of-fact that this is where we should draw the line on Big Government's excessive spending.  You spoke to us like you were one of us, and sir, you plainly are not.  You are in a position of great power, and have been for a long time.  It's hard to believe you or any of congress will be affected to the same extent, if any, as the rest of us if the default happens.  If you were Joe Anyguy, you'd sit down with the President, agree on the numbers being tossed around, agree on a general game plan and quit worrying about that 2% of people whose taxes would be raised if you acceded to the President's tax proposal.

In short, both of you failed to make this a de-politicized issue.  At least the President wants to raise the ceiling high enough so it won't come back again as a political football in 2012, which seems to me like a party-neutral position.  The Republicans have set their proposal's timing to appear to make spending authority a reward for cutting costs, but you can't ignore the fact it makes another heated debate come due at a critical time.  Nevertheless, shame on you both.

And finally, I'm thinking I can't forgive you guys for upsetting me so that I got distracted and missed out on John Cena beating Mysterio just a little later on the same night that Rey had just got the title.  It changed hands twice!  And Heck, I'm still processing that, then CM Punk comes out and... never mind.  Just get this debt business settled before next Monday Night RAW, because if I miss any more wrestling drama, I'm going to scream, and default on my rent.

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