The NY Times has a dispatch from Davos, where the U.S.’s creditors are getting anxious.
Who can blame them?
But the NY Times story dances around the real reason that the world’s bankers are preparing to short the American economy – America’s upside down Social Security and Medicare entitlement programs.
This isn’t much of a secret.
Until the United States adopts comprehensive entitlement reform that makes both the Left and the Right’s constituencies squeal, the real value of our U.S. dollar is “shit”.
And with all due respect to my friends in online communities like The Next Right and Blue Hampshire (who generally represent the best in “fresh” thinking and online grassroots mobilization from both sides of the aisle), any current talk of stimulus packages and bailouts and condoms and funding for the arts and infrastructure spending and tax cuts – that’s all small ball fiscal stuff.
Fun to debate, but small ball.
(Of course, I’m far from perfect. I get caught up in railing against Wall Street’s jackasses from time to time as well)
But, as almost everyone knows but almost no one wants to publicly talk about for fear of pissing off entrenched 20th century interests on both sides of Washington, the real fiscal devil is in those entitlement programs.
And what we plan to do (or not do) about it. Right now.
President Obama has pledged to do something about our entitlement mess. Good, but I’m still waiting to hear what his details are. And all I’ve seen so far from him is more spending and unsustainable short, medium and long term fiscal snapshots.
The good news is that the solution to all this is not complicated. Politically bloody, yes. But uncomplicated.
A bi-partisan commission of our very best and very brightest is formed to study the problem (personally, I’d make David Walker chair of that commission).
President Obama should pledge, at the start, to actively support anyand all of his commission’s recommendations.
The Republican minority should pledge, at the start, to activelysupport any and all of the commission’s recommendations.
The commission is given a few months to study the problem and come up with a solution (the solution is already well known: less services, more taxes).
Congress should then take an up or down vote on the recommendations.
Any incumbent Congressman or woman who does not initially support the commission’s recommendations should be digitally tarred and feathered and beaten into ultimately supporting the commission’s recommendations. Brutally. With hits raining down from both sides of the aisle.
Like I said, politically bloody. But uncomplicated.
And then we all pray that the commission’s recommendations work.
Because if they don’t, the fiscal pounding that we’re currently experiencing is going to look like a mild case of the hiccups in 5 years