What's It Going to Take to Get Our Spending Under Control?
pic credit: Thomas Hawk via Flickr
While I was off in La La Land celebrating Valentine's, it appears as though there was a little action on the federal budget, namely politicos' inability to come to any sort of reasonable compromise or solution whatsoever.
Do Democrats just want to see John Boehner cry? Is everyone so afraid of last year's election that they refuse to do the right thing and are simply hoping they'll have a job in another 2 years? Or does Washington need the crack so bad at this point that they just can't say no and don't see a way out because there just isn't one?
To truly rein in our spending would mean A) an admission of how bad the situation really is and B) a reality check when it comes to how much we spend just to pay off what we've already spent. Case in point, for fiscal year 2011, the Treasury has already spent $169 billion servicing existing debt.
As you can see, debt service is a trap of perpetual debt, one that is exacerbated by the Fed's reckless monetization of new debt.
Good thing most people ignore big numbers like that.
Leave it to the Economist to blame the political bitchfighting for our problems and completely ignore the real issue with a broad, ignorant statement about a regulating force that no longer exists.
Via the Economist's Free Exchange:
I would expect neither Obama administration Jedi mind tricks or secret deals to yield real budget solutions. Explicit outside pressure, from bond markets, will yield deals. And that pressure is not yet forthcoming.
Ever brilliant, WC Varones pointed out to the author, one Fed-loving R.A., that said pressure is "not yet forthcoming because the Fed is monetizing the debt and manipulating the bond markets."
Do we see what the problem is here yet? Tick tock, bitches, tick tock. This issue is not going to solve itself.
Related reading: Sure Recipe for Decline: Neglect and Gluttony [NYT]