Thursday, June 23, 2011
Another Economic Crisis?
The markets reacted favorably to the latest announced European bailout agreement for Greece, but reaction on Greek streets went opposite. The terms called for increased austerity measures, which in plain terms means the common people get screwed to pay for the sins of the Banksters. Just how much austerity can be forced the "PIIGS" nations of Europe without open rebellion remains an unanswered question.
Back on the domestic front, Republicans walked out of congressional budget negotiations because Dems offended them by broaching the dreaded T word. This time it was the suggested phase-out of certain tax breaks that benefit wealthy corporations and individuals that wedged Republican shorts into a bind. Again I'll ask the rhetorical question of why Republicans think borrowing is better than taxation. Why is the ending of tax loopholes that benefit a wealthy few considered a tax increase?
The debt situation in this country is becoming so dire that one wonders how soon the IMF will be dictating austerity terms to the United States. What will be the response in our streets? It certainly behooves congress to address the escalating national debt while we still posess some sovereignty. However, the solution required goes beyond spending cuts or tax increases. The interest on the debt alone threatens to reach gridlock levels. It's difficult to foresee an end game that doesn't involve default or hyperinflation. The present system is unsustainable, and perhaps was designed that way intentionally.
The opening phase of Great Depression II has been relatively painless due to extended unemployment benefits and other safety net programs. The initial stimulus spending facilitated denial for a time, but a new phase is about to begin in which the harsh reality is fully revealed. This appears to be a necessary aspect of the ending of the pesent age.