Today’s Gallup poll shows that confidence in our economic outlook has dropped to near -50. Yes, that is a negative number.
The government shutdown lingers on, and we’re on the brink of defaulting on our debt payments beginning in 48 hours. While clearly the American people perceive this as very bad, we’ve heard opinions from pundits and politicians claiming that it will be good for us to, “Help set our priorities in the United States.”
Well, seeing that these are the same pundits and elected officials who also compare our federal government’s budget to a household budget, we can see where they’d get confused.
If you miss a payment on a credit card, you might have to pay a small penalty fee on your $15,000 balance, and you might receive a “courtesy call” from the bank. They might even report you to a credit agency which would indicate that you were slow to pay, and then increase your interest rates.
If you have an outstanding debt balance of $17,000,000,000 and you miss an interest payment to China, Japan, and other countries, you’ll get more than a reminder notice. Furthermore, since the dollar is used as the worlds currency for markets like oil, a decline in the value of the dollar could aggravate commodity prices triggering all sorts of market consequences.
Then if our credit rating gets lowered, it means we’ll have to pay higher interest rates on our debt for a very long time causing us to raise even more money in taxes to pay for the interest.
As you can see from even our simplified comparison, it’s not remotely comparable to a household budget. The fact that we have elected servants in Washington making this comparison might explain why we have such dysfunction in our federal government.
The world is changing rapidly and as leaders of the free world, we need to keep up the pace. We’ve accomplished nothing in the last three years which is the same as falling behind.
The President has already circumvented congress too much and we’re unwilling to give the executive branch more power. The Fed has even ignored congress and provided its own stimulus and challenged congress to step up.
The blame game is over – you’ve lost the confidence of the President, the Fed and the American people. Even the world has asked you to step up. The House has changed the rules and placed the gavel in Speaker John Boehner’s hand.
What’s it going to be?
You can check out the Gallup Poll here: U.S. Economic Confidence Continues to Slide Amid Shutdown.