There really is no “fiscal cliff” before us because we are already falling. Politicians here in the United States and abroad simply debate methods to dig out the ground at the bottom, hoping to postpone the crash until they leave office.
At the margin, this country asks the world to buy long-term bonds in ever-increasing amounts to finance current expenditures (more than 60 percent of which is dedicated to social programs) and interest at historically low rates. Entitlements remain sacrosanct and have grown astronomically since President Lyndon B. Johnson introduced Medicare and Medicaid. White House federal budget history discloses the dramatic reversal that had defense spending at 47 percent just before the Great Society, then continuously falling to about 19 percent. The national debt now exceeds our $15.8 trillion gross domestic product. More than $100 trillion looms on the horizon for unfunded social welfare programs.
The fact most other countries behave similarly postpones the day of reckoning. They see the specter of their debt entering a marketplace without buyers. They are frightened when imagining a devastated U.S. economy, because feeding the insatiable desires of U.S. consumers has been a mainstay of their prosperity.
I envision something like the final scene in “The Good, The Bad, and The Ugly.” The G-20 members stand in a circle with open graves behind them. Each contemplates how to successfully outdraw the other 19 members and survive the resulting mayhem, which Lee Van Cleef’s character did not. The only thing needed now is a typical expression of human frailty to commence the cascade to catastrophe.