More Dogs on Main
July 8, 2011
Washington is all aflutter about the need to raise the U.S. debt ceiling. It’s become high drama on the political stage that is usually ignored through the summer months. Nobody else seems to care all that much, being focused on more important things like whether it is time to turn the steaks over on the grill, and why the economic recovery hasn’t found you yet.
The debt limit is the authorization from Congress to continue to borrow money to fund the government’s operations. For a generation, we have been borrowing from Peter to pay Paul. During the Bush administration, the debt limit was raised seven times without fanfare because, as Dick Cheney put it, "deficits don’t matter."
Now that Obama is president, there is nothing more important than the deficit. The deficit suddenly is the most important thing in the world to the Republicans. They are willing to blow up the world economy if they don’t get their way. It would be better to cause a worldwide depression than to raise the debt limit, because apparently Cheney was wrong about that, too. The debate is political posturing at its very worst, but Congress has made the supreme sacrifice of canceling its vacation to keep posturing.
So what happens if we don’t raise the debt limit? Nobody really knows. The obvious answer is that if we can’t borrow from Peter, Paul is going to get stiffed. Paul will be annoyed. Paul can afford good lawyers. Once we have failed to pay Paul, Peter might be reluctant to lend us more money that we apparently can’t pay back. The most amazing thing about this situation is that Peter has been willing to keep lending us money all these years in the first place. Peter is an idiot.
If the U.S. defaults on its debts, bad things are supposed to happen, though nobody is completely sure what they are. Asteroids are somehow involved. Some of the bad things include grandma not getting her social security check, which means the nursing home won’t get paid, which means grandma will find herself out on the curb or living with you. Something has to be done.
There was a group from Congress and the White House negotiating on this. But the Republicans walked out at the suggestion that perhaps the tax rates on the wealthy could go up slightly, or maybe the amount of their itemized deductions could be capped. Little Nell was tied to the railroad track, which, like the rest of our infrastructure, is crumbling.
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But there have been some new meetings, and there are rumors of a deal. Much to everybody’s surprise, Obama has caved in. Who would have seen that coming? According to unreliable cable-news sources, the new deal will look something like this: Medicare will be replaced with a system based on Powerball lottery tickets. Anybody who can breathe without mechanical assistance will be excluded. The retirement age for Social Security will be raised from the current levels (67 for most people who have not retired) to 107, as long as you have a note from your mother.
Other cuts in spending will reduce the deficit by $4 trillion over a 12-year period. Everything gets whacked. The Pentagon may see cuts amounting to the price of a ham sandwich. Cutting $4 trillion doesn’t produce a balanced budget where income matches expenses. All that means is that we are not running up new debt quite as fast. In other words, for all the hysteria this has caused, it still doesn’t really solve the problem.
Other key provisions in the great compromise will require Obama to call a press conference to admit that he is from Mars. And in a last minute deal, Goldman Sachs will be given the state of Indiana, lock, stock and barrel.
Obama will proclaim this complete capitulation as a great victory because, deep in the fine print on the legislation, there will be a provision that closes important loopholes in the tax code that are of particular benefit to the big oil companies. These will result in increased revenue of $1.83 over the same 12-year period. Exxon-Mobil will not tolerate such abuses and will move its headquarters to the new tax haven of Indiana where it will pay no tax at all.
Disaster will be averted. The planets will remain in alignment. The Chinese will continue to lend us money for reasons that only they understand. And for the rest of us, how will this new austerity look? Will we notice any difference? It will probably be subtle, but when you visit the national parks, you might want to take your own toilet paper.
And don’t forget to feed grandma. She’ll be hungry when she gets home from work.
Tom Clyde practiced law in Park City for many years. He lives on a working ranch in Woodland and has been writing this column for 25 years.