Monday, January 16, 2023

I'm so tired of Teh Stupid!

The question asked by nations around the world in 2016 was "Why is US politics so stupid?" because America's idiotic Electoral College system allowed Trump to become president even though he did not win the popular vote. 
Now nations will again be asking "Why is US politics so stupid" if America's idiotic Republican politicians allow the world economy to crash because they can't make a simple fix to their debt ceiling procedures. 
In both cases, America knew what the problems were but wouldn't or couldn't summon the political will to fix them. 
The United States already lost political prestige and influence around the world because of Trump -- it took Biden some time and lots of meetings to get the world community to forgive America for Trump.
Now America is risking its economic credibility and clout with the debt ceiling debacle -- and the easiest solution seems to be to print a trillion-dollar coin!
In his The Threats Within substack, Kurt Eichenwald writes seriously about The Greatest Disaster in American History:
...The problem we are facing is that too many politicians simply do not understand that the global markets will never accept unsustainable political promises or multi-trillion-dollar gambles. Sophisticated investors for huge institutions and sovereign nations cannot be managed; what allows them to come to work every day without endless panic is that they understand the pillars of the global economy and anticipate that no one would pull those away intentionally.
The managers of these funds and institutions that play a huge role in keeping the global economy financially liquid all must answer to their bosses, which is why they are constantly looking over their shoulders, trying to anticipate what their colleagues are planning to do. And right now, those massive groups - Vanguard, Fidelity, TIAA-CREF, even China - have made it clear they believe the markets and the economy will collapse if the United States goes into unprecedented territory in this wholly unnecessary debt ceiling game.
Think of it like a bank run: If everybody runs to pull out their money at the same time out of a fear that all their friends, neighbors, and other customers are preparing to drain their own accounts, the bank collapses....
...If the United States government does something foolish and unprecedented, they are not going to wait to see what others do - they are going to make a mad dash to the door, selling all they can while hoping to stay ahead of their competitors trying to push past them. The other thing to know is that these decisions are, for the most part, dictated by computers: When markets fall, trading programs kick in to minimize losses. Which means shooting as many sell orders as possible out there until the market calms.
This is where the Republican strategy, detailed in the Washington Post, will fail. The plan is to go ahead and hit the debt limit, then pick and choose what part of the government will be financed based on a listing of priorities...
This financial plan fails on so many levels it is hard to know where to start...
But over on Twitter, people are just tweeting about the crazy instead -- solving the debt ceiling crisis by minting a trillion dollar coin and then depositing it at Fort Knox to cover the debt ceiling - and you've got to be kidding - please tell me you're kidding. Please? Anybody? Now that somebody has invented the NFT, maybe America doesn't actually need to mint any coin at all. They can just print a picture of the coin and then just say its worth trillions and trillions. Then send an email to Yellen with the photo attached. Problem solved!


Anonymous said...

There's no question that the Electoral College is a stupid, cludgy system, what with the constant threat of unfaithful electors failing to follow election results. But the part about it delivering results that don't reflect the popular vote is exactly what our first-past-the-post system does here in Canada. Indeed, if we had a system that prioritized the popular party vote, chances are we'd be in the third term of prime minister Scheer. Be careful what you wish for.


Cathie from Canada said...

Yes, I can understand this concern -- perhaps pure popular vote isn't always exactly right either!
Though in a straight-up Trudeau vs Scheer contest (ie, without the NDP, Bloc) I think Trudeau would win.