I’m at that time in my observations of what is happening in Washington DC where I just want to ask for the check and get out of this dysfunctional restaurant where the floor show and the food are both equally bad.
Last night, we saw more finger pointing. The President placed the blame on the Republicans for not wanting a balanced approach that includes cuts to spending and increase in revenues, yet earlier in the day he backed the Reid plan which contained no revenue increases.
But wait, The Speaker of the House spoke right after the President and had his own spin on things. Among other things, he claims that his plan is born out of the “bi-partisan” efforts in Congress. Well Mr. Speaker, if it were bi-partisan efforts, why can’t your plan pass the Senate? Five Democratic votes out of a total of 193 Democrats in the House does not make it a bi-partisan effort.
The sad thing is that both parties are not telling the American people the truth, the whole truth and nothing but the truth. The truth is that regardless of what happens over the next week, the US credit rating is going to go down. Why? Well, it’s not about the debt ceiling. It is about the debt and our inability to get control of it. The Democrats and Republicans talk a good game, but neither one are serious. They are both part of how we got here. They are two sides of the same coin. How else can we answer the following questions:
- Is removing a loophole that was created by lobbyist efforts really a tax increase?
- Does a tax system that allows a $200 billion company to pay no income tax make any sense?
- Does a government that spends money in other countries building their infrastructure while our own is falling apart make sense?
However, the markets see this country for what it is… an over-spending entity, that does not invest in itself or its people. It is an entity that believes you can strangle your own bad habits by cutting revenue sources ’till it hurts. The result will not be a default. That is not what the markets are worried about. The result will be the belief that we cannot get our fiscal house in order. In fact that result is already there. The steady decline of the dollar was the early sign. We pay more for things now than we did last year even though demand is soft. The next step will be the lowering of our credit rating which will trigger higher interest rates for the US to borrow. This will have a domino effect on other interest rates that are tied to government rates. The average consumer will see a steady increase in some of the rates they are paying. This begins a spiral effect that is tough in a good economy and could prove to be devastating in our current sluggish economy.
Remember this at the next election. It’s time to vote out the immature kids who can’t play nice. It’s time we vote in some adults who can bring in not the “Change we can believe”, but deliver on the “Change that we need”… fiscal discipline on all fronts.