The good news: in a deal yet-to-be-passed by either house, Obama and Boehner’s Raucous Caucus have finally agreed to raise the debt ceiling by $2.4 trillion in two stages, in exchange for an equal amount of spending cuts — with $917 billion of the cuts to span the next 10 years.
How will the rest of the cuts be administered? By special committee. (That’s the bad news.) Why rush these cuts when we were all starting to have so much fun?
Part of keeping the fun going is that Americans will continue to live in the shadow of the sword. Due to a small proviso cleverly tucked into this legislation, if the special committee doesn’t come up with at least $1.2 trillion in additional cuts (the goal here, is actually more like $1.5 trillion in cuts) or Congress doesn’t agree to green-light them, something akin to martial law will kick in.
What will this look like? Think of a nail-bomb set in advance, designed to spray cuts to the military and Medicare if anyone makes one ill-advised move.
Basically, this part of the deal ensures that even you, the taxpayer, will be begging members of Congress to ratify every last spending cut, lest you dial 911 one day and find that nobody answers.
Hey, what’s a bill without a little blackmail?
Still, it is a sad state of affairs that the only way to get things done these days is to hold ourselves at gunpoint.
The bill is expected to be voted on today. Obama, for all his speeches, has been brutally cowed, again. Spending cuts reign supreme, while Bush-era tax cuts remain unchallenged. It is official: our president buckles like a belt.
Fidelity, which never sends emails, except to market its herd-investing strategies, has suddenly sputtered to life.
This weekend’s missive: “Debt ceiling: what you should know.”
Really. It’s a little late to be sending this now. But what have you got?
It turns out Fidelity is able to direct me to its Web site to get the most clicking, ahem, “best thinking” of its market specialists, who have penned such helpful tidbits as “Inside the U.S. debt drama” and “Fear is not a strategy.”
Fidelity, we know you don’t want us pulling all our money out of our shrinking retirement accounts and stuffing it under our mattresses because that is not good for you. But “Fear is not a strategy”? Come on. That’s pitiful.
We are going down this road no matter what we do now. We’ve heard for a long time something’s gotta’ give. It is just too bad so many people are going to get a lot worse than they deserve.
“Everyone already knows that the U.S. has lost its ‘AAA’ status,” Rogers said (while alternately lambasting the press for taking seriously what he called the ongoing Washington “charade”).
“Anyone who knows what is going on, already knows that the U.S. is now the
biggest debtor nation in the history of the world. It’s only S&P and Moody’s [the ratings agencies] that haven’t figured out what is going on. The investment world knows that the U.S. is not ‘AAA.’”
The truth is, the ratings agencies have figured out the U.S. is not triple-A. But those entrusted with grading the U.S. debt at the ratings agencies have been on the phone frequently with Washington, which means their allegiances are subject to crushing political pressure. Continue reading The Chickens Must Eventually Roost→
“Concentrated power has always been the enemy of liberty.”
— Ronald Reagan
Wall Street blames Washington for all the financial crises. And Washington blames Wall Street back. It would be amusing, if it wasn’t so pathetic.
Now we know the truth — that both are taking turns bringing us to the brink, with only their own self-preservation in mind.
As we emerged, rather confused, from the 2008 financial crisis, a posting appeared in the comments section of The Wall Street Journal. It was as prescient as it was disturbing. It appears in my book, but I am re-posting it below.
Whether you are a Democrat, Republican or Independent, it is worth a read. It is also worth considering that while Wall Street bewails any hint of a redistribution of wealth to the unwashed masses, the largest-ever redistribution of wealth occurred right under taxpayers’ noses to the banks by the billion-load — Wall Street’s greatest coup ever, rubber-stamped by our own elected officials.
“All this goes to show we are now entering the second phase of the world financial crisis. Despite the fact that the anti-social nature of banks has been found out, the corruption of the Fed and the finance committees in the Senate and House are now public, and the solutions to the problems are well known, we still do not possess the political will to carry them out.
“It is clear that a larger problem now looms — the crooks are firmly in power and intend to stay there . . . Americans are again ruled by a plutocracy that has no interest in them other than the money that can be made off them, the same as in 1776 . . . If we cannot kick these people out of power, we are no longer America. And most people sense that. We have become the pleading chickens our founding fathers would have despised.”
Somewhere in the United States, right now, a billionaire is paying his taxes. This makes some people — not naming any names — very unhappy. In our nation, it is imperative that hedge fund managers, for example, pay roughly 15% on earnings via a handy loophole, whereas someone like, say a writer-girl, coughs up over 30%. That strikes some folks as just about right. Call it pursuit of happiness.
Other people’s happiness.
So we have some disagreement there. Elsewhere, others feel that taxing the daylights out of Americans who can’t afford to pay for gas to get to work sounds about right. And that, at one of the worst moments in financial history, forcing Americans to buy health insurance they don’t necessarily want or need so that the healthy insured can subsidize the less-healthy insured is a great idea.
A midlife crisis can take many forms. Cheating on your spouse. Purchasing a Maserati. Wearing Billabong. Buying into The Lynx Effect. Just being a jerk. But putting up an “execution” list on your Web site of high-ranking financial and government officials and urging people to buy guns to help you kill them is one I haven’t heard of. Among those on the hit list of the smiling man in the orange tie to your left: the head of the Securities and Exchange Commission Mary Schapiro and the chairman of the Commodity Futures Trading Commission Gary Gensler — both heavyweight Wall Street watchdogs.
“Go buy a gun, and let’s get to work in taking back our country from these criminals,” he wrote on his site, according to prosecutors. “I will be the first one to lead by example.”
There is a time to wear a headband and a time not to wear a headband. Some would say it is best not to wear a headband outside kindergarten. But if you’re in Istanbul to consider offering the full thrust of free world legitimacy to the Libyan rebels, why not keep things flexible?
Hold the phone, we run of cash when? In two and a half weeks? Bah, fie and tut-tut. So that’s what’s behind this whole debt-ceiling/deficit talk getting in the way of my “Mad Men” re-runs. But maybe there’s a silver lining. One humble query: If our entire nation can no longer pay its bills and decides to cut little old ladies’ social security checks, will anyone notice — or care — if I don’t pay mine?
Seems if the U.S. Treasury and Congress can’t get it together, then why should I?
During a pivotal summit with Republicans yesterday, Obama rose, looked around and, well, booked it out the door. (Or as The Wall Street Journal more kindly put it, Obama found himself “abruptly walking out of a key meeting.”)
I remember when I first read about Rupert Murdoch as a kid, how he barnstormed the British media in the 1960s and published anything that might put the nation’s panties in a bunch: its journalistic establishment, its finance establishment, its trade union establishment, its royal establishment. You name it, if it was a pillar of something-or-other, he wanted to chop it down. Then I learned about his blackheartedness, his don’t give a damn attitude and total lack of self-awareness and accountability. God help me, I thought, I love a psychotic.
While I worked at Dow Jones, we all watched as Rupert Murdoch outfoxed the utterly dundering Bancroft family, owners of The Wall Street Journal. Somehow he managed it so that the family’s only representative on the board was a 27-year-old aspiring opera singer. Even then I reckoned, well, if the family that owns this paper doesn’t realize what a jewel it has, maybe they don’t deserve to own it.
We were also sick of the Bancrofts doing things like selling off all their Dow Jones stock while insisting on keeping their controlling power. It seemed dysfunctional and cheap. Despite his faults, Murdoch was never cheap with the paper — in fact, he’s been spending on it like a drunken sailor — and he seemed to genuinely love and covet it. With Murdoch, coveting is the most you can ask for.
Since then, many have left the Journal, as not everyone favors Murdoch’s rarefied brand of journalism. And while he used to go after the establishment, it seems now what he has always desired was to become the establishment. Continue reading Oh Roop, It Didn’t Have To Be This Way→