Debt Ceiling, The Good, the Bad and the Ugly....
I know most of us are tired of this entire debt issue affair, but I had a few musing about it and am looking for some opinions. I lured you in by suggesting there was something good about the Debt Ceiling issue, but I do have ONE.
UGLY: I blogged last Wednesday that Obama and Boehner were sending a "DIVE, DIVE, DIVE" signal to the market by their bickering on national television. The markets proved to be a little more mature and we have only drifted down about 4%. There were mixed opinions on whether the event would be "actionable". I believe it was, but that depends on your risk/reward and trading patterns.
Tonight the House of Representatives finally passed the "Kick the Can" version. The comment was made that no one appeared happy. I would be confused if anyone was happy about the bill itself, but they might be happy about getting their evenings and golf game back. Compromise, when both sides are so far apart, requires that both sides "give"....meaning....you guessed it, unhappiness.
Ugly: One thing that I'm still a little upset about is that 161 members of the House of Representatives voted against the bill. By waiting until the last minute (ugly) they left theirselves no option other than the Bill at hand, or the default on the debt. How 161 members would rather have default is a bit of a mystery to me, but I do understand that a few fell into an extreme range on the dial that:
1. Felt even if we didn't raise the debt ceiling, we had other alternatives such as pacing the bills through the system for a short time longer, invoking the 14th amendment, or borrowing short term from Apple.
2. Felt that default was needed to send a message, understood the consequences and was willing to live with it.
3. Just plain dumber than dirt.
The majority who voted against it, however, would probably say that they knew there were enough votes to pass it, which means no risk of default, which means they could cast a protest vote.
I really don't have a lot of respect for protest votes. I've seen a few that ended up back firing years later by being used as snippets in anti-political ads. If I wasn't so lazy, I'd start a website with the names of all of the Representatives and how they voted. I really think only a small percent of voters really care about issues enough to show their distain by how they vote, but enough do that it might be interesting in some voting areas.
I'm probably a lot more understanding about the conflict between political party than most people. We pick our candidates by choosing those who most reflect our values. Some voters are strict Republicans and some are strict Democrats, but it seems more are claiming to be "unenrolled" and can thus swing from party to party. I think my understanding comes from my personal background. My parents were Democrats, with hourly jobs, barely making it on minimum wage, depending on the union to help with discerned "fairness", and at some periods paid piecemeal rates, ($0.09 to peel a pan of tomatoes). At this point in my life, I lean Republican, based on my own job, finances, and personal outlook. So I do try to see both angles, even though I have my own opinions.
I'm not sure how the bi-partisan Commission will work out in doing phase II of this ordeal. The Commissions in past are sometimes success, but usually not. They seem to be necessary sometimes when hard decisions have to be made. Cutting the budget and/or tinkering with taxes and/or social programs are areas where the politicians, just by virtue of the job, (being accountable to their constituency), just can't do it. Bi-Partisan Commissions have been used somewhat succeessfully when nothing else worked, such as chosing which military bases get closed or when making some Social Security changes in the 80's. One issue (the bad) is that this drags things out further and it's hard to say if the credit rating agencies will stay away. Overall, I don't think anyone puts much stock in what the credit agencies do.
My confusion: I've never been able to make up my mind if our forefathers thought the party system would last this long and have such diversity/extremes. It's interesting to see how that despite our historical changes, (slavery, race, manufacturing, outsourcing, etc), that we have this much to disagree on and how it still has some geograpical context Then we confuse things further by having tea parties after we threw the tea overboard.
I'm not sure which way I would rather see the mix between the House, Senate, and President align. If all three had the same party in strong majority (well the President would be a majority of one, but I think you get my point), then they could easily pass whatever they wanted. With a mix between the three you risk gridlock. So Gridlock.....or one party in full, complete control without a balance for accountability??
I think I'd lean toward a mixed bunch of fruits and occasional gridlock, but in times like this, with the rest of the world watching and the long term damage that did/could occur, I'm not sure.
The Good: I did promise when I lured into my musings that something good occured during the debt crisis....I did mislead, as I didn't mean something good came of the childish display and our leaders waiting until the last possible moment. Rep. Gabrielle Giffords voted today after her long recovery. I'm glad the vote wasn't decided by only one vote or some disgruntled Congress Person would probably claim her vote shouldn't count due to her condition. I'd have to say, based on her vote, that from a mental perspective, she demonstrated far more sense than 161 of her colleagues. Welcome back Congress Woman Giffords!
TSIF, The Sky isn't falling today, but I don't discount that it's possible some day.