Game Of Clowns

In 1953 the Washington Generals basketball team was formed.  From 1953 through 1995 the Generals played more than 13,000 exhibition games against the Harlem Globetrotters. They won 6 games and lost 12,994.  It’s abundantly clear that the Generals need new blood.  And here they are:  at center, Barack Obama, at forward, John Boehner and Harry Reid, and at guard, Mitch McConnell and Nancy Pelosi.

These clowns will enable the Washington Generals to lose every game.  But what will be different will be their ability to claim credit for having failed.  Look at how pleased they all are with their effort to avert default on the full faith and credit of the United States.  Look more carefully at how long they have labored and how little they have produced.

The Debt legislation that the President signed into law August 2nd makes a mockery of what needed to be done.  It does not include entitlement reform.  It does not include tax reform.  It does not include any increased revenue. It does not remove the uncertainty in the business community about Government policy that is required before businesses will begin to invest the $2 trillion dollars that sits on their balance sheets.  It does not mandate at least $4 trillion dollars in savings over the coming decade that is the minimum necessary to convince the world that America will deal with its debt and deficit crisis. And now S&P has downgraded the nation’s credit rating from AAA to AA+, and is threatening to further reduce it early next year.

Instead the new law creates a new Congressional Committee that’s supposed to do what neither the President nor the leaders of Congress could do after months of tortured and ridiculous bargaining. It’s a gimmick for the election campaigns next year.

In the meantime it’s clear that our economy is on the verge of plunging back into recession.  Economic growth is stagnant.  Unemployment is over 9%. The stock market is plummeting.  And the Obama Administration, the Congress, and the FED have squandered their opportunities to intervene in an effective manner.

What is less clear is the linkage between our faltering economy and the continuing death spiral of the debt and the deficit.  We have no chance to fix the former without being willing to pay the terrible price to fix the latter. 

But the Washington Generals have proven they won’t do the job.  In December of 2009 I wrote in this space, “How sad it has become to face into the reality that we’ve sent a rookie to do a pro’s job”.  The Obama Administration is failing the nation and the antics among the Republicans who wish to replace the President offer no reason to believe that they would be any better—different, but no better.

America desperately needs a third alternative to these warring clowns.  Stay tuned.

LeRoy Goldman

August 6, 2011

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