Wednesday 13 July 2011

evasive maneuvers

First seeing the headline that US pensioners might be affected by the looming national borrowing frontier, I scoffed a little, wondering why anyone would proffer such a new worry, reviving the fears and panicky behaviour of a few months ago of a government-services collapse. That was a battle-of-the-wills too, to see who would risk compromise or be obstinate on blame. I thought the pronouncement was only some reporter glomming on to one phrase and appeal that was not meant to be showcased--that is, until I heard the same scary news picked up by German broadcasters. Maybe it is still just a threatening projection, because I think too the rest of the world is prone to gawk at a country that would just shut-down or threaten to do so. I don't think there have been accords by the polarized political parties and talks have not progressed, but there have certain been some exercises in creative and critical think. Apparently, mostly without such theomachy, the US president has asked and been granted lifting the debt ceiling about one hundred times in the past, having exceeded what the US Congress had appropriated in the fiscal budget. Some are proposing a bit of theatre, legal fiction, to give the office of the president autonomous authority and responsibility to raise the legal borrowing limit, independent of congress. This does not create extra money or save social programs, but it allows for no deflection of responsibility (de facto but not in fact since all agencies are responsible for their own fund management). Further, this shifting of blame may prevent delay of the US government defaulting on its obligations (to creditors, and to its people) but taking on more debt, regardless--for example, in August, the government is scheduled to make $23 billion in Social Security payments but only expects to generate $12 billion in taxes on the day outlays come due, and unable to pawn more debt, the government can only spend what it takes in--only restores allocations' and appropriations' role, again threatening a government closure. I don't know what can be done but there is no choice between supporting corporate or public welfare and the two should not be stood up as warring standard-bearers.