Trust is the cornerstone of many words ending in "ship". Relationship, friendship, partnership, etc. Without trust you don't have ship.
I understand your perspective on the sanctity of legislated spending. But to what extent should spending increases accomplished via executive order, be paid for? Maybe as part of the debt ceiling negotiation, they could cut back the awkwardly named Inflation Reduction Act, to its legislated amount. Maybe they could also defund all spending arising from all executive orders.
The most significant breach of authority at the moment is the student loan forgiveness. Hopefully the SCOTUS strikes it down. I’m completely opposed to any spending not originating in Congress.
Agree on both student loan forgiveness spending (SCOTUS) and unauthorized spending. I have not seen the numbers behind the numbers, but a recent read had the EO supplementing IRA at 2.5x legislated spending. In round numbers that is $600B. Too many significant breaches.
I was suggesting that, without that change, the Trust will be lost regardless of what happens in the present debt ceiling negotiations. There isn't Trust anywhere that any political process will bring about that change, a shock will be necessary. So in my view, the question to debate is what is better, a shock now when the debt is $31T or a shock by the end of the decade when it is $52T or even later when it is $100T?
I can’t help but wonder whether we’ve already crossed the rubicon on the trust issue. The government’s response to the GFC, the ‘what just happened’ handling of Covid and vaccines from which many are still reeling and confused, the flagrant censorship of opinions and counter arguments (even I’ve been censored), the destruction of critical infrastructure belonging to our allies (that may be lost on a lot of Americans but not on those of us living abroad), the clownish fighting between major US corporations and state governments together with US corporations’ heavy influence on healthcare and policy (I’m talking about you Big Pharma - but there’s also Big Food. Big Tech and the MIC). And for all the self-congratulatory talk I hear or read from MSM, it only takes one trip home to see for myself the abysmal condition of our country, or a check on the mortality stats, or how we fare on quality of life surveys, true democracy surveys, and educational standards, the few number of engineers and STEM graduates we produce and the ones we do create - their genius is applied to complex financial instruments no one understands or computer algorithms to spy on or control our behaviours. The backbone of our country - industrial manufacturing is gutted - what do we make anymore? And if I’m concerned I may be too hard on ‘us’ I need only have to field questions from my European friends (and strangers when they find out I’m from the US) who ALL ask, what has happened to America? I think we are a dysfunctional nation and those in the wealthy bubbles of the US equivalent of Versailles and its surrounds, who have the political power and wealth, don’t realise how bad it’s gotten. Sorry to be so grim.
While the debt-ceiling itself is farcical, it is imperative that the US get its financial spending in order. This is not a GOP or Dem issue, both parties have been complicit in the above charts and even now, on the brink of default, the GOP still wont touch the biggest drivers of spending.
As I have written many times, we need to totally revamp healthcare and social security spending, but also how we derive that revenue, shifting from growth-depressing taxation to growth-enabling taxation.
It goes without saying that Trust is an important lubricant. I disagree that without structural changes in the appropriations process, market participants will continue to trust the US government to continue to make payments well into the future. In a decade, the decade the debt will be $51T. When you have to issue debt to pay interest on the previous debt, some will question the sustainability of their investment. Do we have the trust in our political parties that such changes will be made? If so, what is the difference if the trust shatters now or later?
“ I disagree that without structural changes in the appropriations process, market participants will continue to trust the US government to continue to make payments well into the future. ”
My point is precisely that we need structural changes in the appropriations process. Specifically to authorize debt implied by an unbalanced budget as part of the budget process rather than in a separate vote.
Well stated. Trust between counter parties is fundamental. We can litigate when trust fails but that is, at best, a band aid on a broken bone. Paying late after a default because politicians are playing games is a band aid.
I’d take a step back towards the root issue. Trust requires a common set of operative facts. If I think that BRK.B should be worth $350 and you think it should be worth $300 that is fine. Different opinions are okay and lead to efficient(ish) markets. But if I base my opinion on the “fact” that Warren and Charlie died in 2010 and were replaced by AI, a long term relationship is impossible.
At this point, it appears that Washington no longer operates on a common set of operative facts with divergent opinions. “You are entitled to your opinion but you are not entitled to your own facts” as DP Moynihan once said, is dying or dead.
Trust is the cornerstone of many words ending in "ship". Relationship, friendship, partnership, etc. Without trust you don't have ship.
I understand your perspective on the sanctity of legislated spending. But to what extent should spending increases accomplished via executive order, be paid for? Maybe as part of the debt ceiling negotiation, they could cut back the awkwardly named Inflation Reduction Act, to its legislated amount. Maybe they could also defund all spending arising from all executive orders.
The most significant breach of authority at the moment is the student loan forgiveness. Hopefully the SCOTUS strikes it down. I’m completely opposed to any spending not originating in Congress.
Agree on both student loan forgiveness spending (SCOTUS) and unauthorized spending. I have not seen the numbers behind the numbers, but a recent read had the EO supplementing IRA at 2.5x legislated spending. In round numbers that is $600B. Too many significant breaches.
I was suggesting that, without that change, the Trust will be lost regardless of what happens in the present debt ceiling negotiations. There isn't Trust anywhere that any political process will bring about that change, a shock will be necessary. So in my view, the question to debate is what is better, a shock now when the debt is $31T or a shock by the end of the decade when it is $52T or even later when it is $100T?
I can’t help but wonder whether we’ve already crossed the rubicon on the trust issue. The government’s response to the GFC, the ‘what just happened’ handling of Covid and vaccines from which many are still reeling and confused, the flagrant censorship of opinions and counter arguments (even I’ve been censored), the destruction of critical infrastructure belonging to our allies (that may be lost on a lot of Americans but not on those of us living abroad), the clownish fighting between major US corporations and state governments together with US corporations’ heavy influence on healthcare and policy (I’m talking about you Big Pharma - but there’s also Big Food. Big Tech and the MIC). And for all the self-congratulatory talk I hear or read from MSM, it only takes one trip home to see for myself the abysmal condition of our country, or a check on the mortality stats, or how we fare on quality of life surveys, true democracy surveys, and educational standards, the few number of engineers and STEM graduates we produce and the ones we do create - their genius is applied to complex financial instruments no one understands or computer algorithms to spy on or control our behaviours. The backbone of our country - industrial manufacturing is gutted - what do we make anymore? And if I’m concerned I may be too hard on ‘us’ I need only have to field questions from my European friends (and strangers when they find out I’m from the US) who ALL ask, what has happened to America? I think we are a dysfunctional nation and those in the wealthy bubbles of the US equivalent of Versailles and its surrounds, who have the political power and wealth, don’t realise how bad it’s gotten. Sorry to be so grim.
While the debt-ceiling itself is farcical, it is imperative that the US get its financial spending in order. This is not a GOP or Dem issue, both parties have been complicit in the above charts and even now, on the brink of default, the GOP still wont touch the biggest drivers of spending.
As I have written many times, we need to totally revamp healthcare and social security spending, but also how we derive that revenue, shifting from growth-depressing taxation to growth-enabling taxation.
It goes without saying that Trust is an important lubricant. I disagree that without structural changes in the appropriations process, market participants will continue to trust the US government to continue to make payments well into the future. In a decade, the decade the debt will be $51T. When you have to issue debt to pay interest on the previous debt, some will question the sustainability of their investment. Do we have the trust in our political parties that such changes will be made? If so, what is the difference if the trust shatters now or later?
“ I disagree that without structural changes in the appropriations process, market participants will continue to trust the US government to continue to make payments well into the future. ”
My point is precisely that we need structural changes in the appropriations process. Specifically to authorize debt implied by an unbalanced budget as part of the budget process rather than in a separate vote.
Well stated. Trust between counter parties is fundamental. We can litigate when trust fails but that is, at best, a band aid on a broken bone. Paying late after a default because politicians are playing games is a band aid.
I’d take a step back towards the root issue. Trust requires a common set of operative facts. If I think that BRK.B should be worth $350 and you think it should be worth $300 that is fine. Different opinions are okay and lead to efficient(ish) markets. But if I base my opinion on the “fact” that Warren and Charlie died in 2010 and were replaced by AI, a long term relationship is impossible.
At this point, it appears that Washington no longer operates on a common set of operative facts with divergent opinions. “You are entitled to your opinion but you are not entitled to your own facts” as DP Moynihan once said, is dying or dead.