Will the Market Do What Western Leaders Cannot?
The Daily Bell – by Anthony Wile
It’s a sign of the times. President Barack Obama’s ballyhooed fiscal commission on Friday failed to come up with a plan to curb the US budget deficit. For close to a year, the panel has been laboring on US$4 trillion in cuts that would take place, approximately, over the next decade to pare the federal deficit to 40 percent of gross domestic product by 2035.
The deal was that the plan would be brought to the floors of the House and Senate if the proposal had the support of 14 members. But the vote was three shy of what was necessary. No deal. No vote. One more nail in the coffin of American fiscal solvency. What will happen now? Well, there have been pledges from various House budgetary authorities that some of the recommendations will be put in place anyway. But here is a question: Is US$4 trillion enough to put America back on a firm fiscal footing. The answer in fact may be “no.”
Here at TheDailyBell.com, we tend to be libertarian-conservative in our outlook: government is the problem, not the solution. To rely on government to clean up the mess that has been made is a little like relying on an out-of-control bully to bring harmony and discipline to the classroom. It’s not likely to happen.