It has just been announced that Republicans, Democrats and and President Obama have reached a deal to raise the US government's debt ceiling.
Because as Peter Schiff said last week, “The real crisis will occur not if we fail to raise the debt ceiling, but if we succeed.” The door is now open to new borrowing, new spending, more stimulus of the kind that has already signally failed … and many more crises to come down the road—and in very short order.
And don’t think that raising the government’s debt ceiling will comfort America’s producers, or avert a downgrade of US Govt Debt.
It is important to recognize that the down grade [will not be] fundamentally based on the debt ceiling issue. The credit rating agencies are focused on the long term deficits faced by the U. S. government. Raising the debt limit may (or may not) help in the short term. However, if federal government spending and deficits are not reduced U. S. government debt will be downgraded and rightly so. The government will ultimately default on some of its obligations unless spending is brought under control…
Corporate America is fundamentally concerned about the financial instability of the U. S. government and the very destructive regulatory environment, which is why businesses are holding so much excess cash. It is impossible for a business to be fully prepared for a downgrade, but CEO’s see the government deficit problem, and out of control spending as far deeper than the debt limit fight.
That’s what virtually every party to this argument, and every report from the MSM, has wilfully ignored. The fight over the debt limit has been a fight over consequences—when the real battle should have been over causes.
Even now, they fail to recognise that.