It provided me with great entertainment over the past couple of years to watch the rise of the Tea Party, a far-right, “small government” grouping that took off in protest against “Obamacare” (because after all, who would want guaranteed access to healthcare? Not morons, that’s for sure).
And then I was again amused to see a number of Tea Party-supporting morons elected to Congress last November, representing a swing to the right both within Congress and within the Republican Party, which saw (relatively) sane candidates swept away by morons. But nobody told me these lunatics could have the power to crash the world economy…
Republicans in Congress are blocking the requirement to raise the US debt ceiling; without this increase by early-August (at the latest), America will default on its debt, leading to an unprecedented disaster across the Western and global economy. The Republican demands seem to come in two flavours: very moronic and ultra-moronic:
- Those who are simply “very moronic” demand that Obama introduce huge spending cuts and no tax rises at all, even for the wealthy.
- The “ultra-morons” (including MoronWatch favourite Michele Bachmann) simply don’t want to increase the debt ceiling at all.
Note that Obama is offering heavy spending cuts (in line with initial Republican demands), but is also insistent that some tax rises are necessary.
This may seem a complex decision, but there are some clear-cut points here. Here’s a quick guide (with thanks to The Economist) to the US budget decisions.
- Is this the right time to start heavy cuts? That’s debatable. Cutting while the economy is still weak will hurt the economy – how much it gets hurt is open to debate, but a recent study by IMF economists suggests that heavy cuts tend to do more harm than good. This implies that the Republicans and most Democrats (including President Obama) are wrong in introducing austerity at this stage.
- Do there need to be tax rises? This is more clear-cut: the Economist, in an unusually outspoken editorial, recently referred to Republicans as “economically illiterate” for insisting on no tax rises.
- Does bashing the poorest make sense? Republicans have suggested cuts to programmes such as food stamps. Ignoring the sheer callousness of this proposal (when these same people won’t support tax hikes for millionaires), this again is economically illiterate. Food stamps generate activity in the economy – $1.73 for each $1 spent. So the cuts would depress the economy by more than they save – and that doesn’t take into account the economic and social effects of having millions of people (half of them children) going hungry.
The result of not raising the debt ceiling would be so catastrophic that economists are barely even trying to predict what would happen, instead choosing (for now) to say “they wouldn’t let that happen, would they?”
So why are morons like Bachmann even contemplating it? I can think of three explanations:
- Somehow the US electoral system really did allow genuine, barely-literate morons to be elected. They simply don’t understand the implications of what they’re doing, and believe the “we don’t need government” nonsense that they spew out.
- Some of these people are religious nuts; they live for Armageddon, and have got themselves into a position to bring it forward by crashing the global economy. Think I’m joking? Sadly, no.
- This one is a guess on my part: The suicide-bomb theory. The US owes China vast amounts of money – that’s part of the source of China’s growing economic power. Perhaps the morons think that if the US defaults on its debts, China would suffer enormous damage too. Of course, the only problem with suicide bombing is that the US (and Europe) would go down along with China. Perhaps these crazies think the US could recover quicker, and postpone the day when China inevitably takes over as the world’s largest economy.
The only bright side to this is that hopefully, once this crisis is past, some of the smarter Republican voters will be so scared, so repulsed by these morons that the Republican Party will be punished for its lurch to craziness by being swept from power: in Congress and across the states for a generation to come. Are Americans well enough educated and informed to make that call? Let’s hope so. But there needs to be an earthquake in US politics. A vibrant democracy needs at least two viable alternatives – the US currently only has one.