The Policy Junkies Work is Now Done

One of the side-effects of the lengthy debt ceiling debate and downgrade coverage was the exhaustive and widely publicized focus on the country’s ugly mounting debt load as well as the key factors and trends that will drive the burden dramatically higher in coming years.

It should come as no surprise that the populace is disgusted given the whopping numbers and extraordinary rate of change… total government debt was a $10 trillion in late 2008 when all the hubbub was made about needing to add an additional digit on to the Durst debt clock in New York’s Times Square.

A mere two and a half years later and Washington DC pushes the economy to the brink bargaining over an increase in the debt ceiling allowing for the current $14.3 trillion in gross government debt.

That’s a massive increase of $4.3 trillion (a 43% increase) in just about 35 months or an average increase of $123 billion per month or roughly $4.1 billion per day.

And it’s not as if we are experiencing robust growth in the economy that could work to, in a sense, mitigate the mounting debt, our economic growth has been abysmal at best with GDP increasing ever so weakly.

So, the debt is simply piling up as policy junkies in Washington DC and elsewhere continue to push their failed Keynesian experiments in a supposed attempt to “boost aggregate demand” and address the high unemployment rate.

Given that these fraudulent policy schemes and boondoggles provided very little benefit and came at the cost of a downgrade to our sovereign credit rating, it is now time for Washington DC to do a complete about face and begin implementing major austerity.

In fact, given the specter of further downgrades as soon as this November by S&P and the looming possibility that Fitch and Moody’s may soon slash their assessments of U.S. sovereign debt, an effective approach to austerity is truly mandatory.

Ignore the policy junkies and their scare tactics, their archaic methods have been tried and failed.

The only way forward is to end all the preposterous policy action, clean up the government balance sheet, and let the chips of reality fall where they may.

Downgrade! Downgrade! Downgrade!

What an epic non-event.

So the "game of chicken" was played to the end and what do we get for all the strife and tumult?

Nothing more than further confirmation that our legislators (and executive branch) in Washington D.C. are a bunch of big government policy sissies.

Like a gaggle of peacocks, the Feds put on quite a show when agitated but once the going got really tough, they cut and run.

$917 billion over a decade back-loaded so as to mostly take effect after 2013 (or even 2016)?

Another trillion (and change) of cuts over that same period left to be decided by some congressional super committee?

What a ridiculous crock?

This is nothing but a charade, not so surprising I suppose given this "fake it till you make it" era we find ourselves in, but still what a phony baloney outcome.

S&P was looking for at least a $4 trillion debt reduction plan and as the outcome came nowhere near that mark, I say downgrade! Downgrade! Downgrade!

The American people deserve a good downgrade.

Like a good swift punch in the face, cutting the credit rating of the U.S. government would provide an abrupt and sensational burst of painful truth to be felt in all corners of the economy.

No individual, household or firm would be spared and a sense of real outrage would be shared and immeadietly directed at the perpetrators of generations of policy malfeasence and grotesque tax and spend bloat.

But the outrage would not stop with policy junkies in Washington DC.

In all likelihood a downgrade (and the shared pain) would work to force Americans to face the truth about the dire economic predicment they are in and moreover, the fact that they themselvs are culpable for having fallen prey to snake oil pushing policy wonks with a penchant for providing cradel-to-grave "solutions".

Kicking the can down the road may have provided an adequate resolution for this episode of political theater, but the real economy and your future remains under siege of big government debt overload.

Bring on the downgrade!