October 8, 2013 (San Diego) Several writers have now gone and told us, we are living in a constitutional crisis. Among them Jonthan Chait, writing for the New York News and Politics. He argues in the article that:
Republicans is their utter failure to grasp how Democrats would perceive their behavior. Conservative reporter Byron York perceptively, and alarmingly, describes a discussion with an influential Republican, who explains that the GOP stumbled into the shutdown war without a plan and repeatedly expected Democrats to bail them out by capitulating, only to be shocked when they refused.
It is a stunning piece of writing, especially if you just stumbled into this recently. The GOP, the modern GOP has evolved into a regional party, southern party, confederate party. It is hardly a national party anymore. The goals of this party are nothing short of anarchy and a return of the country to Southern Living. I do not mean this as the nice things. I mean this as no workers rights, no women’s rights and a religious bent to it. After all, this is a Christian Nation, and the First Amendment be damned.
Members of the Tea Party Faction are quite on the far right side, and even this does not make them justice. It is silly to just think of them as far right, There is more to what these guys are. They have a precedent in American history. The 1850s are very close to the current dynamics we are seeing, and that crisis led to a civil war. They are proud know nothings, like the Whigs were. In their mind, it is them who are right and have all answers, the rest are not just wrong, but eschatologically wrong.
It does not matter that all respected economists, even more moderate and business friendly members of their own party told them the shut down was a bad idea, as in disastrous. Now they are trying to blame the other side, I guess for not capitulating.
Their talk regarding the default is just as dangerous. Ted Yoho’s (FL-R) quote regarding this is just a damn classic The Freshman Congressman said,
“I think, personally, it would bring stability to the world markets,” Yoho told the Post.
This is dangerous thinking, In their religious zeal, and yes, that is exactly what it is, and willful ignorance, these bumpkins are placing the country, and the world economy at great risk. They are also willing to throw the American Empire to the side, but to their credit, in their ignorance they do not understand this.
So let’s review the danger of this.
The United States has been the reserve currency since 1944. It was part of the Breton Woods Agreements that among other things created the World Bank. This means every transaction in world trade is denominated in US Dollars. Some of you might be familiar with Petro Dollars. We have gone to war to preserve this status. It gives us a great advantage as a nation when we trade abroad, and some nation states have chosen to use the US Dollar as their national currency,
This is why the Mexican Peso, the Canadian Dollar, and the Euro are always indexed against the US Dollar. What this practically also means is that the world is awash with dollars. Since we are the reserve currency we have printed literally trillions of the stuff that not only went to US Banks but central banks around the world. It is part of the national reserves many nations use. Sure, some nations still keep some of their reserves in gold, and a few have experimented switching to other major currencies, such as the Euro. But overall, they mostly keep it in dollars.
This is because of the good faith and credit of the United States guarantees the green back, and ensures the Empire. This is why a default will be literally a stake though world commerce. We default, the trust in the good faith and credit of the United States will possibly be gone overnight. Oh and the effect on Americans in the heart of the Empire could be literally catastrophic if those trillions are sent back, and the world decides, you know we can’t trust these yahoos any longer, who wants to be the central currency reserve now? It will not happen that colloquially, but Americans should study what happened to the British Sterling when they no longer were the reserve currency at the end of World War Two. Their post war recession was deeper and longer than the rest of Western Europe, in-spite of the Marshall Plan. Yes, the Sterling has recovered, but England is no longer an Empire, but a junior partner in the American empire. (There is a lot of funny in that, but that is another post)
Now but, if we raise the limit this means the government will keep spending. This is a canard from very ignorant people who do not even bother with the most basic of this. This is to pay for debts already incurred. So if the Congress wants to stop the raising of the debt ceiling, they need to stop authorizing that spending to begin with. But none of us expect these people to know this. And to be honest, the US Congress has always had a couple colorful ignorant members, who always amuse the rest with their willful ignorance. But it looks like they reached critical mass these days, just like they did before the last Civil War.
So I say to those in the commentariat finally joining the rest of us with knowledge of U.S. History, welcome to the hair on fire Constitutional crisis brigade, (that includes you Mr. Hayes, your piece yesterday at your show is worth watching). So how dangerous is this crisis? Some of us have been saying we are moving towards a hot civil war. No, those of us writing this who have any sense do not want one. Trust me, it will not be fun and far from “Call of Duty.” But the differences between the Neo Confederate party determined to impose it’s views of the world on the rest of the country, even when they are an obvious minority, has already triggered an obvious Constitutional Crisis. We have been moving towards one for at least a decade, if not longer.
Later we will deal with why our system of government does indeed require a few reforms, though I am aware that none will be brought forwards in the current environment. But after the crisis is over, reforms need to be considered, and seriously considered. Though given the country is pretty balkanized anymore, I am not sure survival is ensured out of this crisis. Yes, it is that serious.