Deal Or No Deal? July 31, 2011
Posted by Benjamin Wendell in Economics, Politics.trackback
It’s Sunday and the US is a little more than 48 hours from being in the same situation as a lot of its citizens, being unable to pay its bills. The House plan was soundly defeated in the Senate and the Senate plan was trashed in the House. The Senate, in the persons of Harry Reid and Mitch McConnell are currently drafting the grand “compromise” that they say may work. Compromise is in quotations because it appears the only compromise is the Democrats giving the house, the farm, and the firstborn to the Republicans. The plan will have a couple of trillion in spending cuts, including Social Security and Medicare, and barely a whisp of a nod toward revenue increases. Even the suggestion of letting the Bush era tax decreases lapse, as they are scheduled to do in 2012, may be enough to keep the Tea Baggers from backing off their obstinancy, failing to comprehend when their opponent is yelling “uncle!” and slapping his palm on the mat.
If the congressional compromise fails, as it very well might, the president will be left with the options of letting the debt ceiling crash and watch as millions of Americans don’t get their checks and thousands of creditors shake their heads in stunned disbelief, or of employing the “Constitutional Option” and invoking the 14′th Amendment. That would require courage. Don’t hold your breath.
BW
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