The Debt Clock Is Running

The allegedly bipartisan Super Committee, which was created to cut at least $1.2 trillion in government spending over the next decade, isn't so super after all according to the Los Angeles Times story Deficit 'super committee' may put off decisions.

By Lisa Mascaro, Washington Bureau—

With time and compromise slipping out of reach, the congressional "super committee" may punt its toughest deficit decisions to next year rather than strike a deal that would enrage both parties' political bases heading into the 2012 election.

The Joint Select Committee on Deficit Reduction has until Nov. 23 to agree to a package that would reduce deficits by $1.5 trillion over the next decade.

Achieving that goal would require painful compromise — both parties would have to give up political weapons they have hoped to wield over the next year. But failure could roil the financial markets as the holiday shopping season begins and further trash the already record-low approval ratings for Congress.

You will recall that the committee was born as a result of the debt ceiling compromise last summer. Zerohedge points out that "the country has already issued $700 billion in debt since then, and by the end of [last] week, total US debt will be just shy of $15.1 trillion." Actually, the debt clock says we're at $14,991,068,000,000 and small change at this very moment on November 14, 2011. The numbers change so fast! The debt was several million less when I started this paragraph.

I thought you might like to watch it.

UPDATE: The damn debt clock is wrong. It now stands at $14.999 trillion. Watch it at debtclock.org.

Oh well, as Immanuel Kant said, "out of the crooked timber of humanity no straight thing was ever made."

Think about your day. You wake up in the morning. The debt clock is running. You have breakfast (maybe) and go to work (or not). The clock is running. You return home in the evening (or go to your second job to make ends meet). The clock is running. Being an informed citizen, you spend your free time (all 10 minutes of it) reading the latest post from DOTE. The clock is running. You go asleep. While you sleep, the clock is running. You wake up in the morning...

If the Los Angeles Times story is correct, and there is every indication that it is, the amount of debt accumulated will far exceed the amount the Super Committee was supposed to shave off future spending by the time a decision is made. We've been told, according to the deal cut last summer, that large automatic spending cuts will kick in if the committee utterly fails to make a decision.

This would include about $600 billion in cuts to future Defense budgets. We've been told that our National Security will become our National Insecurity if we spend even a dollar less on Defense. This supposition is so crazy and absurd that it does not deserve comment. Nevertheless, don't expect those automatic future budget cuts to be enforced for this reason and many others. In fact, there are exactly as many reasons as there are special interests to be appeased. There will be a compromise deal of some sort which is "good enough" to prevent the consequences of inaction, which don't kick in until 2013. From the Los AngelesTimes again—

In an effort to avoid stark failure, a fallback plan is emerging that would push tough decisions on taxes to next year, perhaps into a lame-duck session after the election, according to officials familiar with the panel's discussions.

Under this scenario, the two sides would agree now to a level of revenue from new taxes. They would direct the congressional tax-writing committees to revamp the tax code with fixed dates and goals. The object would be to generate new revenue while lowering corporate rates and keeping the top individual bracket no higher than the current 35%.

The move would allow the two sides to reach the outlines of the deal now, while deferring the most difficult issues until both see who wins the 2012 election. Currently, election politics makes an agreement difficult — each side has used the budget stalemate as a rallying cry and each believes it stands a chance of winning next November and thereby being able to strike a better deal.

If voters deliver a clear verdict in November, Congress might be in a better position to come to terms.

In the United States, tough decisions can not be made during an election cycle. But we are always in an election cycle. Therefore, tough decisions can not be made. Period. And if for some crazy reason you decide to vote for Tweedle Dum or Tweedle Dee next November, or even if you write in Bozo The Clown, which is my personal recommendation, remember this: as you pull the voting lever, the debt clock is running.