How we function is a primary variable in that calculation.
If we continue to erode international faith in our willingness to pay our lawful debt, and in our willingness to compromise to address these budget problems, eventually the debt downgrades will bite into investor willingness to hold our paper. Which then helps accelerate that point where inflation eats us alive. Best thing we have going for us is the lack of other viable options for “risk-free” paper.
Problem is, all our brinksmanship is over marginal issues that ultimately don’t matter. Especially given the geopolitical pressures on our military budget, the only things that really matter are entitlements. Yet, that’s the thing we remain stubbornly unwilling to address. One of our greatest points of bipartisan agreement. Haley uttered the possibility of increasing retirement ages, just for people only just now entering the workforce, and that immediately became a cudgel for Trump to beat her with. I doubt it mattered much to her prospects, but it’s not like voters flocked to her either.
Right now we are in no near term danger of these budget cliffs. We have a greater capacity for debt than any institutional debtor in history. But we’re on a path to erode that capacity, without even arguing about the things that really matter. Sometimes it seems like our elected reps are trying to accelerate the arrival of that budgetary cliff. [Post edited by hoolstoptheheels at 01/25/2024 1:11PM]
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In response to this post by Stimp)
Posted: 01/25/2024 at 1:09PM