Not scared of heights, arya? Doesn’t matter. Because, while many Americans were over-toasting the New Year and sane people went to bed at 8, Congress was alertly – well, they were awake, at any rate – rather, as awake as they ever get – saving their nation and ours from a plunge off the “fiscal cliff” created by our National Savior and his Money Doesn’t Matter socialism. I think it’s considerate of our National Savior to provide his own crisis to save us from ... don’t you? Very conscientious.
All the major headlines this early January read “Leap Narrowly Averted” or something similar. Pah. It’s not a cliff. It’s merely one of many possible exit ramps from the crazy financial roller coaster our nation is riding onto an even crazier one. Picture the train track from The Polar Express, or perhaps the mine cars from one of the Indiana Jones movies – the one where he escapes bad guys, saves Steven Spielberg’s wife, and rescues an adorable Indochinese street urchin in a mine car or three.
The immediate result of taking this exit would have been stock markets tanking the world over. Maybe the US credit rating would be lowered a smidge, but probably not – it would be viewed as racism. Congress would still have had several weeks to a few months to address the issue[s] in the way they have in the past: retroactively. They’d have passed a bill in January, or possibly February, ... or maybe even March, which would have made all its taxing and spending provisions effective as of January 1st, thus effectively passing a law declaring that they had, indeed, acted before the end of 2012.
Then the markets would have rebounded the world over, as if to say, “Phwew!! Don’t scare me like that! We almost went over the cliff!!” And, unless the bill Congress passed in early 2013 was one that my strict libertarian sensibility would have hailed, nothing would ultimately change: we’d still be on the same insane roller coaster ride heading to fiscal ruin, national fracture, internal revolt and foreign territorial claim jumping.
But, as it happened, Congress did indeed address the “immediate cliff crisis” with whole minutes to spare and avoided having to pass a law early in the year declaring portions of this this winter to be a do-over. Thus is our republic spared ... of having to deal with its own sloth and avarice. For while the major headlines scream that Obama saved the day by holding Congress’ feet to the fire, inside on page 5, just below the School Menus for our youngsters’ first week back after the holidays, is one or maybe two short articles spelling out what else is going on in conjunction with our National Savior saving us from himself.
In short, we’re in more trouble now than we’d have been had Congress done nothing. For tiptoeing into the New Year through a side door while the noisy, self-congratulatory parade of politicians came in the front are two troubling items.
First, because the deal they passed only raised taxes and didn’t address spending other than to leave it alone, Congress’ own Budget Office projects a $4trillion deficit for fiscal 2013 ... which began last October 1st and is now three months old; this new projection is based on the details of the bill just passed. And these bean counters always underestimate how much they’re truly spending. Their projected deficit is roughly 2.5x Obama’s largest deficit to date, and roughly 8x larger than the largest deficit run by his spendthrift predecessor, the one the National Savior and his acolytes and apologists still point at when the subject turns to which president over-spent most obscenely.
Of course, the primary difference between 2012 with its $1.5trillion deficit and 2013 with its projected $4trillion deficit is the initial implementation of large parts of Obamacare. Remember when Obamacare was only projected to cost $1trillion over ten years? And then when it was only projected to have doubled in cost from $1trillion over ten, to $2trillion over ten? Ah, but reminiscing gets us nowhere...
Next, there had been some discussion recently as to when our super-thrifty National Savior would reach his credit limit of $16.some-odd trillion – Dec 17th? Dec 12th? Dec 26th? – but Treasury Secretary Tim Geithner quietly announced in a letter to Congress on the 31st that the limit was definitely upon us on New Year’s Eve when Congress was busy clapping itself on the back for failing to do anything about it. As a result, Geithner announced that he was therefore going to undertake a series of “extraordinary measures” from now until the end of February – for that is as long as he thinks he can juggle it – to both post-date the nation’s debt payments and search the country’s couch cushions for loose change.
Among the measures Geithner is going to take – apart from the pre-payday check-kiting that we’re all familiar with – is a tight schedule of bouncing federal money from one federal checking account to another federal checking account, to cover those checks he’s kiting.
Additionally, he’s going to suspend the Congressional and federal employee pay raises that our National Savior unilaterally handed out the week before Christmas, and he’ll “reinvest” federal pension dividends in T-bills ... otherwise known as embezzling. By moving money, paying monthly minimums, forgoing in-house allowances, asking creditors to please wait a day or two before depositing the checks we send out, and by stealing, our Juggler in Chief, Timmy the Magnificent, or perhaps The Great Geithner, can hope to get $200billion of wiggle room for up to two months.
Of course, this is figuring at last fiscal year’s deficit rate of roughly $1.5trillion per year, which borrowed a little over $100billion per month. This fiscal year’s deficit rate is being clocked at $4trillion, which is well over $300billion per month. Timmy the Great seems to think he’s got $200billion of juggling he can do before it all collapses at his feet. But the math leads me to think that by Martin Luther King Day Congress will either have to figure out how to stop spending money or allow the National Savior to create an even bigger crisis for the nation to endure.
Smart money – what there is left of it – is on the even bigger crisis. Four trillion bigger, over just the next nine months. Phwew! That was a close call!