What did you think they’d do?

The Debt Ceiling Extension Is Bad News for the Economy

Yesterday Congress voted to “temporarily” (nothing in government is ever temporary) extend the debt ceiling for 3 months to give them time to negotiate the fiscal cliff and sequester issues.  Upon hearing this I immediately decided to call Visa and inform them that I had decided to temporarily (for 3 months until it becomes permanent) increase my credit line while I figure out how not to tighten my family’s belt.  I explained to them that I’d be taking a couple, maybe 3 cash advances so I’d be able to make the minimum payments each month but not to worry as they’s be on time.  You see, this is very important to me since I have an excellent credit rating (recently downgraded only one notch) and don’t want to be seen as a deadbeat creditor.

Did you expect anything else?  Do you expect Congress to all of a sudden get a backbone and no longer borrow more?  Do you expect them to tell the country that we must “live within our means?”  The funny thing is that if they did this, people would be so pissed off and no one would be re-elected.  Of course the 50+% who receive “assistance” would vote them out because of benefit cuts but even those who pay in will vote them out as taxes rise and the economy implodes destroying jobs and businesses.  Can’t anyone see that the economy “left to its own” and without deficits (they really do matter don’t they?) would “grow” at an 8-10% lower clip (which by the way would be seen as a DEPRESSION)!  …And the stock market would trade down maybe 70-80% before finding any support, interest rates would immediately rise to 5% and then start going up, and the banks… insurance companies… bread lines?  Do you see what would happen if we really, truly lived within our means?  Like real people?  Real businesses?  This would be suicidal!

Read More at Miles Franklin . By Bill Holter.