The congressional supercommittee officially fails today. Gridlock doomed it. Good. It deserved to fail.
Ron Paul was right. The whole idea was unconstitutional. The U.S. House of Representatives is in charge of the budget, not some joint committee.
The whole thing was a sham to get the no-compromise Congressmen to buckle and vote for an increase in the debt ceiling. It offered a fig leaf to them. But there was not a snowball’s chance in West Texas that the committee would agree to any program of welfare spending cuts and tax hikes.
We see warnings that stocks will fall because the committee failed. If stocks fall, this has nothing to do with the failure of the supercommittee. That committee was fake from day one.
That anyone could have imagined that the committee might succeed is the height of naivete. There was no chance. In any case, the sanctions for failure were mild: $120 billion a year in automatic cuts for a decade, with estimated deficits over $1 trillion a year — window dressing. But none of the cuts will take place. The budget deficits will increase. The national debt will increase. Congress will simply ignore the deal. Who can tell them no?
The public does nothing — in Europe, in the United States, in Japan. The public doesn’t know what to do. The special interests do know exactly what to do: lobby for more. There is no concerted effort by the voters to throw out every politician who does not vote to balance the budget by cutting spending. The voters want their goodies.
There is no solution except default. It’s coming. Nation by nation, it’s coming.
Meanwhile, there are forecasters who think that the failure of the supercommittee is important. Ignore them.