September 30, 2016 marked the end of another Federal Government fiscal year and with it the Federal Debt jumped $1.3 Trillion; in a mere 12 months. Yes, it is true that Congress hasn’t managed to deliver the required Budget Resolution since 2009 and though President Obama is complicit in the failure he’s not entirely to blame; Congress, however, is.
Setting aside the Budget for the moment, understand the nearly 25% of annual Federal Government Spending is actually not even part of the Budget. From military expenditures for various foreign policy ventures to special funding vehicles for disasters and on to off-book “black-ops” spending to any number of scheduled or unscheduled handouts there seems to be no shortage of spending opportunities.
Gone, if you haven’t noticed, is the political hammer of the Government “shutdown” threat and replaced by what is largely the cause of the massive debt-explosion. Over the last eight years a much feared tool, that once forced Congress to stare down the barrel of fiscal discipline, has surreptitiously been retired; the Debt-Ceiling limit. Since 2012 Congress, with encouragement from the Executive Branch, has simply bypassed the formal Debt-Ceiling convention and they’ve done this by suspending it concurrent with various and successive Funding Resolutions. We now have a “Floating” Debt-Ceiling Limit.
Yes, we no longer have a formal Federal Budget, we have “Short-Term Funding Resolutions” (STFR) simulating the Budget Process thru the use of incremental funding agreements. This deceptive process has given life to yet another idiotic bureaucratic euphemism known as accommodation by “Extraordinary Measures” which, in the simplest terms, suspends the Debt-Ceiling limit for the duration of the “STFR” at the conclusion of which the Debt Accumulated, for funding the Government during the resolution period, simply and automatically is added to the previous Debt-Ceiling which then, automatically, becomes the New Debt Limit.
No political hardship, no public disclosure, no transparency and no accountability. When you hear talk of income-disparity you mustn’t think that disparity is occurring simply because the wealthy are getting wealthier, but more so because of the once dynamic upward mobility of the Working-to-Middle-Class has been defeated by the unrecorded explosion of two key areas:
(1) The massive Government spending trough that is fueling explosive inflation evidenced by the colossal over valuation of Equity Markets and the devastating affect this continues to have.
(2) Comprehensive Wealth Creation Capacity. Trillions of inflated dollars are being wasted by Government Spending and speculative trolling of Global Equity & Derivative Markets in an attempt to keep pace with inflation.
The net effect is that this entire cycle of stupid is actually further seeding the inflation spiral and accelerating the whole affair toward terminal collapse. By comparison, do you know that there has been no single new Stock Issue (that I can find), in the last 23 years, dedicated specifically to either the creation or the expansion of Domestic Productive Capacity? In fact, every dynamic political or financial “play” since 1989 has driven a complete departure away from true economic expansion.
The great danger going forward is that the key issues needing attention are being ignored although Trump occasionally brushes up against relevant points, he doesn’t dare go into depth. The anxiety that will accompany the truth will force the voting public toward the comfort promised by the Clinton-lie repeated with relative frequency. The System is not just broken; it is completely out of control!
Curtis C. Greco, Founder