BandAid or Cure? Ouch. Someone dropped the ball.

It seems like Washington said “I can’t do it.”, got up and walked away. I’ve been reading up on the debt deal (which, by the way, is being called an austerity measure).
I am glad to see that social programs are exempt from automatic cuts, but very dissapointed that both education and infrastructure are on the chopping block, with out revenue generation.

We’re an expanding nation. Of course it costs more. What do you expect? Do you have an image complex? Embrace your size…(humor not intentional)

By the way, is having economic troubles “in” or something? Now, to be hip with everyone else do nations need to, say, get their austerity on? We DO NOT need an austerity package. Who are we? Greece? Last I checked we were in the USA.
Please read the emphasized part. This is what I’m talking about.

Oh, and now we get to have the same “doomsday” drama all over again while we wait for the details of what we’re going to have to live without:

“…the American public will no longer have jobs, cars, houses, schools, lands, food, or clothing. Times are tough, but we all have to give up a little. And by the way, vote for me. Thanks. God Bless America”

Clearly the fact that the country will not default, if this deal is passed by both houses will be a great relief for the financial markets. The promised amount of cuts is also big enough that it may keep the credit rating agencies at bay in regards to downgrading the US’ AAA credit rating. The impact on the economy are going to be contractionary as that much aggregate demand will be taken out of the economy by fiscal consolidation aka austerity.

The economics team from JPMorgan says that federal fiscal policy will subtract around 1.5% points from GDP growth in 2012.

Also this bill seems to avoid the real underlying causes of the US fiscal situation and that is the growth in entitlements and the lack of revenue being raised by the US. Both of these important factors to the US deteriorating fiscal position are not addressed here.

[Emphasis supplied]

Source: Breaking Down the Details of the US Debt Deal FXTimes

I would break down the details but Time has cast his lot as a foe to my cause.

I played guitar today until my fingertips cringed at the slightest breath of steel. Must repeat, soon. We are wayy over due for a lab update. Lots of exciting news to be told. 🙂


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