Peter Coyne

“Suppose you were an idiot. And suppose you were a member of Congress. But I repeat myself.”

– Mark Twain

Enter last Friday’s Washington Post commentary:

“After two years of harrowing confrontations in Washington, the national debt is no longer growing out of control and policymakers from President Obama to House Speaker John A. Boehner have rushed to take credit…”

Did the debt shrink? Have changes been made to the structural deficit built into the nation’s fiscal plan?

Ha! Of course not.

One estimate from professor Laurence Kotlikoff, an economist at Boston University, takes account of all the projected unfunded liabilities and interest payments and puts the U.S. debt at $222 trillion.

It’s a laughable figure. Unimaginable, even.

“The deficit is getting better,” explains I.O.U.S.A. protagonist Robert Bixby tried to explain to the Post on Friday [our cynical ears can hear him snickering over a can of Tab], “but it’s not a result of any hard choices Congress made. They all want to get on the aircraft carrier, like George Bush with his ‘Mission Accomplished’ banners.”

Mr. Bixby may have the most complicated document filing system in Washington.

Bixby's Desk
The nation’s most unlikely, yet stalwart, fiscal hero

Bixby is also the executive director of the Concord Coalition which, for the past 21 years, has been “sounding the alarm” about the nation’s fiscal imbalances during most of his waking hours since.

“It’s very frustrating,” he said “because you can feel the momentum being sucked away from the budget debate. But then you look at the numbers and you realize how little has been done to solve the basic problem.”

Yet the Post article continues:

“This week, the Center for American Progress, a think tank with close ties to the White House, published a report urging policymakers to ‘hit the reset button’ on the budget debate: ‘No more pretending that the sky is falling. No more rash actions to cut the deficit without regard for real-world impacts. No more calls for an ever-elusive grand bargain’…

“‘It’s true that we still have a long-term deficit challenge,’ said the center’s president, Neera Tanden. But ‘if you were entering the country from another planet right now, you would wonder why our economic policy is focused on the deficit, which has stabilized, when we still have 7.5% unemployment.’”

Heh. If you were entering the country from another planet right now you would wonder why anyone would buy into the political process.

When I.O.U.S.A. premiered in 2008, we highlighted the leadership deficit — how Washington is badly broken. Here’s an update five years later:

It still is.

Badly.

Broken.

Given a choice, any politician will take the easy road, promise what he can’t deliver and then make excuses. Who do Americans have to blame but themselves? In the last two presidential elections, $11.3 billion was spent on campaigns. What’s the return on investment?

Regards,

Peter Coyne
for The Daily Reckoning

P.S. “Read the article, folks,” a recent reader urged. “It’s from five years ago” and worth it for the perspective. The reader was responding to some inquiries on why the Daily Reckoning would feature the likes of Alan Greenspan and Warren Buffett. It seems they understood where we were coming from — at least more than a few other commenters we read. And a large part of that context can be gleaned by subscribing to the free Daily Reckoning email edition. So if you’re not getting the DR delivered straight to your inbox, you’re only getting half the story. To sign up for free, click here now.

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“Deficits Do Matter”

Paul Oneill

When you get extended to the point that you can’t service your debt, you’re finished. So you go through a calamity -- you go through a terrible inflation, which is a way of having a national bankruptcy, and you destroy accumulated income and wealth.

Peter Coyne

Peter Coyne is the managing editor of The Daily Reckoning. He received his degree in economics and political science from Loyola University Maryland where he studied under the Austrian economist, Tom DiLorenzo. Before joining Agora Financial, Peter worked in Congress for Dr. Ron Paul until he retired in 2012.

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