Sequester: Main Street loses, Wall Street Gains
From whatever point of view you see the sequester impasse, the inability of Washington politicians to put aside the interests of a few in order to serve the people should unsettle markets around the globe. Given that the American consumer drives so many global economies, and especially the US economy, the prospect of massive pay decreases and layoffs should unnerve the strangest of souls.
It sure didn’t seem to bother millionaire Speaker of the House, John Boehner, who seemed delighted that he had received 98 percent of what he set out to accomplish with the impasse. It didn’t bother Mitch McConnell, Minority Leader of the Senate.
And, it didn’t seem to bother the members of Congress who packed their bags for a nice long weekend away from the stress of listening to each other do nothing. Happy days are here again for Congress as smiles were aplenty after another tough, short workweek, a condition that about 750 million Americans are likely to experience by the end of 2013.
Markets Not Surprised By Dysfunctional Congress
Even the markets realize how dysfunctional Congress is and responded to the expected stalemate without blinking an eye. Wall Street has given up on Congress, taking an “assume the worst” mentality.
On Friday, US equities moved higher despite Congress and the sequester impasse. The USD gained against the euro, against British Sterling and the yen. The DOW gained 35.17. The S&P gained 3.52. Take that Boehner and crew.
Actually, let’s be clear. John Boehner has no idea what he wants. He is not calling the shots. He, himself, is hostage to a group of radicals that American taxpayers have elected and who have a mustered about a 10 percent approval rating. If you think they care, you are wrong. The Ryan–Cantor-Palin Tea Party radicals are up to their old tricks.
Despite Obama’s reelection, the Tea Party fears for their lives and has become more intransigent, not less. These politicians prefer the interests of their contributors to the interests of their constituents. Just as they have done for the past two years, these guys think the goal is to not permit any Obama legislation.
Their mission has nothing to do with the best interests of their constituents. Their mission has everything to do with the interests of their campaign supporters most of who do not live in their districts. When it comes to Republicans, money talks, morality walks.
The sequester impasse is enough to make one wonder where the economy would be if Congress just disbanded permanently and we didn’t have to listen to anymore. How much could we save without paying these people, their benefits, luncheons, fitness center upkeep and membership, airfare, staffs, medical benefits, pensions, etc. Why are we not talking about those ridiculous expenses?
A small group of radical GOP conservatives have taken the American public, and the world’s biggest economy hostage. While Boehner, McConell, Ryan and Cantor are taking bows for resisting an approach to deficit reduction that the majority of taxpayers and a bigger majority of economists agree are unsustainable, the country has an excellent chance of another Republican forced recession.
And, guess who is really to blame? Yup, the blames is squarely on the people who voted these radical Congressional member to office, you and me. We are all to blame. We let these self-indulgent, lazy and self-important fools pontificate about their wonderfulness and vote them into office despite a ten percent approval rating.
Let’s be clear. If you are down and almost out, you are in trouble. The Republicans idea of fixing Medicare is to deny elderly medical benefits.
What the sequester presents the American public is probably not a short-term disaster. The long-term could be another problem. But, Congress and Wall Street do not worry about the long-term. They make profits and get re-elected based on the short–term. The long-term bothers President Obama and the people living on Main Street.
So, these are the battle lines; Obama and Main Street vs. Congress and their special interests. A vote for Congress is a vote for special interests on both sides of the aisle.
When the short-term is threatened, equities fall. When the long-term is compromised for short term gains, markets go up.
What a formula for disaster. The Tea Part could care less about Main Street. They talk a good game about the long-term, but don’t kid yourself, that is not their guiding light. They figure if they keep squashing Main Street, they appeal to a certain group on contributors who will get them reelected.
In the Halls of Congress, that’s the name of the game, nothing more, nothing less. How could anyone want such a job, one that comes at the expense of your own morals, hits the communities you live in very hard and causes pain to 95 percent of voters?
When will the American voter wake up? Maybe after the next recession, enduring the risks of criminally weak defense and education systems, the voters will rise up.
At some point in time, Main Street had better learn to stand up for itself. If you do not change Congress, you deserve what you get. Let’s hope we have a country left by the time Main Street wakes up.
John Boehner and the Tea Party got 98 percent of what they wanted from the sequester impasse, did you?