Wednesday, January 02, 2013

How We Got There

Whether the fiscal cliff has been avoided or not, I think it's pretty interesting how we got to that cliff mark (again).  It's also pretty interesting that our elected federal officials used the same anvil-laden parachute to float us down (again).

As Michael Hiltzig pointed out, the whole episode is laced with "cons" being employed by those officials.  His column from yesterday lists and explains those cons (and the entire column should be read), but the one which intrigued me the most was the one that set the whole thing in motion.

The debt ceiling con:

The original of this con is what put us at the fiscal cliff in the first place, for the automated spending cuts being dealt with now were put in place as the GOP's price to raise the federal debt ceiling and stave off a government default in 2011. The debt ceiling was not designed as a constraint when it was created in 1917 — it was convenient blanket authority for the Treasury to issue debt so that Congress wouldn't have to vote permission each time a new bond had to be floated.

Approval was always routine — the limit was raised 91 times between 1960 and the showdown in 2011. Now it's a hostage-taking situation, destined to return in the next month or two when Republicans who didn't get what they wanted in this week's cliffhanger menace the creditworthiness of the U.S. again.

For a brief shining moment, President Obama dreamed of folding an end to the debt limit into a fiscal cliff deal, but that didn't happen. The idea that the debt limit discourages fiscal irresponsibility is a scream. It doesn't now, and never has, stopped Congress from enacting any spending plan or tax break it pleases, creating a budget demand that has to be paid for with, yes, debt. If Congress wants less debt, it can cut spending or raise taxes. The debt limit is a dangerous weapon in the hands of irresponsible legislators, and it's time to take it out of their hands.  [Emphasis added]

So there is some justice in this world.  The Republicans got backed into a corner of their own making.  Have they learned anything from this lesson?  Not hardly.  Their whinging and wailing over the Senate bill was accompanied by dire warnings that the debt ceiling would be where they will take out their frustration at being busted for ... using the debt ceiling to take out their frustration at being busted for ...

Well, you get the picture.

Craziness abounds.

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