Let us keep to the path to nowhere

Perhaps the Demonicans would rather have a plutonium coin…

Real Americans do cry in their beer

Charles Johnson of Little Green Footballs chides Tea Party leaders for whining:

What I don’t get: Tea Party leaders wished out loud for the US to default on its debt payments, so why are they whining now when people blame them for the S&P downgrade?

I mean, they didn’t get everything they wanted; they didn’t get to cause a full-fledged economic disaster. But they did manage to force the first US credit downgrade in history, and that’s not too shabby. Maybe next time the apocalypse.

Quote of the day

The International Financing Review (h/t Cate Long) points to the altered “country risk” assessment the United States courts with its mindless, absurd, ridiculous and irresponsible debt limit ‘debate’:

It is not clear yet if the US Congress will raise the nation’s debt ceiling in time to avoid a default, but the country’s gilt-edged credit rating is clearly now vulnerable to a downgrade, and that is going to have a lasting effect, regardless of the outcome in Washington.

Imagine that another country was threatening to default out of choice — and imagine what the President, congressmen and senators would say if that country owed money to the US. The volume would be deafening as US officialdom made the most of its bully pulpit to demand that the nation in question lived up to its obligations. They would point out that no internal dispute could possibly provide an excuse for threatening to default – and that such a decision would irreparably damage that country’s credibility.

They would be right, of course, and the same applies to the US.

Well, we’ll see. After all, America is exceptional.

Quote of the day

Attaturk asks:

Who actually won [the Congressional wrangling over the debt limit vote] last night, the hypocrites, the assholes or the insane?

He also answers his question:

Oh yeah, it is still a tie and also all of them.

What’s wrong with this thought?

In a widely read and much discussed article, Elizabeth Drew wrote:

Someday people will look back and wonder, What were they thinking? Why, in the midst of a stalled recovery, with the economy fragile and job creation slowing to a trickle, did the nation’s leaders decide that the thing to do —in order to raise the debt limit, normally a routine matter — was to spend less money, making job creation all the more difficult? Many experts on the economy believe that the President has it backward: that focusing on growth and jobs is more urgent in the near term than cutting the deficit, even if such expenditures require borrowing. But that would go against Obama’s new self-portrait as a fiscally responsible centrist.

First, let us consider the point which Drew got right: America’s political situation is now in such a low state and likely produce a bizarre outcome with respect to the “debt limit” and “budget priorities” conflicts that future Americans — along with others around the world — will find it difficult if not impossible to understand and explain what happened in the summer of 2011. It is telling that a routine matter like increasing the debt limit triggered a budget conflict. This fact strongly suggests that Washington was waiting for the occasion to run wildly into this risky future.

Let us turn to what is wrong with her thinking. Obama is not a fiscally responsible centrist. The broadly construed reasons for making this judgment: He’s not fiscally responsible and he’s not a centrist. How might one reasonably call Obama a fiscally responsible politician when he has already refused to use the 14th Amendment and Coin Seigniorage options to manage the debt limit political problem? With this double refusal Obama has publicly embraced Federal debt default as an acceptable political risk for him and the country he governs. Now, to my mind, befuddled as it is by leftwing thinking, defaulting on the nation’s debts is as obvious a case of fiscal irresponsibility as one could imagine. Promising to do so if pushed is no improvement at all. So, Obama is not a fiscally responsible president.

Furthermore, how might anyone consider Obama a centrist when he has embraced a reactionary political economics? Choosing to throw millions into poverty is always a politically reaction path. And this is the path Obama has put his name on. Perhaps this Democratic President does sit between the far rightists and the moderates and leftists in his own party. But that fact, assuming its veracity for the sake of the argument, only reveals the vacuity of the term, “centrist.” Even though he might be a centrist in this sense of the word, Obama would remain a reactionary in the substantive sense of that word, albeit a reactionary who sits between the farther rightists and the undifferentiated mass sitting to his left. There is little that is tempered, rational, pragmatic and thus moderate about this President’s politics. He fights for the programs he believes to be best.

Drew’s erroneous Obama interpretation may originate in her belief about Obama’s ‘right turn’:

The question arises, aside from Obama’s chronically allowing the Republicans to define the agenda and even the terminology (the pejorative word “Obamacare” is now even used by news broadcasters), why did he so definitively place himself on the side of the deficit reducers at a time when growth and job creation were by far the country’s most urgent needs?

It all goes back to the “shellacking” Obama took in the 2010 elections. The President’s political advisers studied the numbers and concluded that the voters wanted the government to spend less. This was an arguable interpretation. Nevertheless, the political advisers believed that elections are decided by middle-of-the-road independent voters, and this group became the target for determining the policies of the next two years.

That explains a lot about the course the President has been taking this year. The political team’s reading of these voters was that to them, a dollar spent by government to create a job is a dollar wasted. The only thing that carries weight with such swing voters, they decided — in another arguable proposition — is cutting spending. Moreover, like Democrats — and very unlike Republicans — these voters do not consider “compromise” a dirty word.

Pace, Drew, it is a matter of public fact that Obama wanted to cut Social Security and other entitlements since the early days of his administration, and his desires were reported to be such at the time. Knowing this about Obama’s intentions, I would argue that the President is not a weakling or a deal-maker willing to bridge two extremes; rather, he is a Machiavellian virtuoso who has used the Congressional Republicans as his stalking horse. As Michael Hudson observes, “Obama has come to bury Social Security, Medicare and Medicaid, not to save but kill them.” The reality of the moment shows that, “The President and his men simply support terrible policies.” And it is because of his masterful statecraft that the President now sits in just the place he wants to be — holding an axe over the neck of America’s New Deal liberalism. The fall of this axe will be Obama’s radical change we can believe in.

Quote of the day

Nancy Pelosi (D-CA) is reported to have said:

“It is clear we must enter an era of austerity; to reduce the deficit through shared sacrifice.”

Acrid mockery of the Congress

The Onion helps to correctly frame the debt debate:

WASHINGTON — Members of the U.S. Congress reported Wednesday they were continuing to carefully debate the issue of whether or not they should allow the country to descend into a roiling economic meltdown of historically dire proportions. “It is a question that, I think, is worthy of serious consideration: Should we take steps to avoid a crippling, decades-long depression that would lead to disastrous consequences on a worldwide scale? Or should we not do that?” asked House Majority Leader Eric Cantor (R-VA), adding that arguments could be made for both sides, and that the debate over ensuring America’s financial solvency versus allowing the nation to default on its debt — which would torpedo stock markets, cause mortgage and interests rates to skyrocket, and decimate the value of the U.S. dollar — is “certainly a conversation worth having.” “Obviously, we don’t want to rush to consensus on whether it is or isn’t a good idea to save the American economy and all our respective livelihoods from certain peril until we’ve examined this thorny dilemma from every angle. And if we’re still discussing this matter on Aug. 2, well, then, so be it.” At press time, President Obama said he personally believed the country should not be economically ruined.