Beltway Bitchin’ & The Death of Leadership

“We’re not going to be—I mean, we’re not going to be disrespected. And so that’s where we’re at today, where we have to get something out of this. And I don’t know what that even is.”—Representative Marlin Stutzman, Republican, Indiana

We are now five days into the first government shutdown since 1996. Now at least we know what it is about, thanks to the remarkable candor of the honorable Marlin Stutzman of the Hoosier state of Indiana. The Republicans, #1. Will not be disrespected, and #2. Want something out of this before they are going to do the right thing and end the misery that is affecting millions of Americans. Before you dismiss this as some kind of grim, tongue-in-cheek joke, let us take a closer look at these demands.

First, some history. The “We want Respect” comment is more pertinent that you might think. In 1996, when the government was shut down under President Clinton, his opponent, House Leader Newt Gingrich later admitted that the way in which Clinton disrespected him made him demand more to end the shutdown. Perhaps that was why that was the longest shutdown ever—21 days. [Let us hope and pray that we don’t beat that record, because that will take us careening into the debt ceiling Armageddon due date—a discussion I will end this posting with].

So, how have we gotten here and why can’t we get out of it? Those answers are obvious. We got into it because House Leader John Boehner was unable to lead his caucus. And why was that? Because—and excuse the language—the junior Senator from Texas, the putz Ted Cruz, Tea Party ring leader, wanted to shut down the government. Hard to believe, isn’t it? but it’s true. Just ask another congressional Tea Party genius, Michele Bachmann, who remains under investigation by the House Ethics Committee, which may be why she has decided to retire at the end of the year (I count the days—85). What has she said on camera, incredibly enough? “We have never felt more motivated and energized,” [by the shutdown].

Unbelievable. People—millions of Americans—are suffering, and the United States is quickly becoming the laughing stock superpower that could not shoot straight (Syria), nor negotiate its way out of a paper bag (the shutdown).

With “leaders” like these, no wonder we are where we are. Ted Cruz is the single most dangerous, disingenuous, and disastrous senator since Joseph McCarthy (it was McCarthy who saw Communists in every corridor of Washington and Hollywood—he even went after Lucille Ball, for Gods sake). However, Cruz has miscalculated (a JFK favorite word). He wants nothing less than the presidency, but he is—and never was—a viable candidate. Cruz will go, in my opinion, the way of Michele Bachmann. Something terribly embarrassing will end his career sooner or later, as I am a strong believer in karma. He may even put the Tea Party out of business single-handedly. He has certainly diminished the Republican brand in a very real and enduring manner—although he went on national television to declare how he is simply representing the wishes of the American electorate. How stupid does he think we are? The only person Ted Cruz is capable of representing is Ted Cruz. Period.

Put another way, Cruz will burn out, and if he does not go the way of Bachmann, buried by some well-deserved Senate investigation, he will find his own hellish route to disrepute (I think he is there already, and I know I am not alone in that conclusion). Let’s not forget that at different times, characters like Herman Cain and Donald Trump were at the top of the polls on the Republican side of the presidential ticket, albeit briefly. Hell, the only thing congressional members agree upon these days is their burning hatred of the junior senator from Texas—Ted Cruz.

While Cruz gets his own special place in hell, there is plenty of “anti-leadership” to go around. After Cruz, the next poster boy for that label is John Boehner. Why finger him? Because Boehner cannot control his own Republican conference in the House. One distinguished Senator, Charles Schumer of New York, has called Boehner “a puppet in which Ted Cruz holds the strings.” That depiction is correct. Cruz is the current de facto leader of the House. The selfish and destructive faction he leads is holding the entire country hostage. But, and this is the key, Cruz could not do this alone. He needs co-conspirators, and I do not mean only the Tea Party extremists under his “hypnotic” powers.

The House Leader himself, John Boehner, is not only not leading—he is following the very worst in his party, no—the very worst in our country. He could stop the shutdown at any moment he chooses by simply putting the Senate CR (Continuing Resolution—-meaning the bill to open the government) up for a vote. He would have enough Democratic and Republican votes to end the shutdown. Why won’t he? Because it would almost surely end his leadership. In other words, he is putting his own leadership—not even his job, he would still be a congressman—above the needs of the country, and above the constitution (how can one pursue happiness when they have no paycheck or face cancer with no hope for help, and on and on). This is a sad state of affairs. Boehner is to be blamed, and while this is not an excuse, he is stuck between a Cruz and a hard place. But ultimately, John Boehner is the only Republican in the House with the moniker “Leader” in his title. No matter how we got here, it is his responsibility to get us out.

On October 6th, 11 days before the Debt Ceiling Armageddon date, Boehner is still sticking to “I won’t bring anything to a vote unless the President sits down and has a serious conversation with us” mantra. That is what he told ABC News George Stephanopolous on the Sunday morning This Week program. But Obama did negotiate in 2011 and that led to a huge loss of confidence in the American economy, a stunning 15 percent loss in the Dow, and the downgrading of the U.S. Credit Rating from “AAA” to “AA.” All that damage and the U.S. never did breach the default date. God knows what will happen if we do indeed go past the 17th of October with no new budget being passed. However, negotiating did not work for Obama last time out, and I don’t think Obama wants to repeat that 2-year old miscalculation again. History will tell us if he is right or wrong this time around.

That is why the dearth of leadership does not end with John Boehner. President Obama deserves his fair share. Not for what he has done, instead more specifically what he has not done, but how he has not done it. Obama often has a leadership tin ear. Why, for Peet’s sake, do you invite the Congressional leadership to the White House so they can have an awful meeting in which he repeats his mantra “I won’t negotiate.” He knows that Boehner and company will simply go out to the waiting microphones and mimic his “I won’t negotiate” mantra. That is awful optics for the president. Don’t misunderstand me. He should not negotiate over the debt ceiling. That tactic almost brought down the economy in 2011. But he can be far more clever in choosing how he won’t negotiate (more on that in a later blog posting).

So where are we? After this weekend, the government will be no closer to re-opening than it was on Day One of the shutdown. That creates a new and far more explosive possibility. The potential of the defaulting of America, something that has not happened in our 237-year history. Once the financial markets open Monday, Obama will still have the shutdown on his hands, but then our problem multiples because we will only be about 230 hours from the Debt Ceiling drop-dead date (October 17th) and the defaulting of America. So plan on seeing that countdown clock at the bottom of every cable news channel by sometime this next week.

And all economists agree that if default is allowed to happen, we will immediately be thrust into a recession that could be worse than the financial meltdown of 2008-2009. And not only the United States, I am talking about a deep and biting recession that will spread around the world faster than any infectious disease. A recession might happen anyway because we are surely losing several hundred million dollars a day in revenues, thanks to the shutdown. If we do not open for say, another ten days, we will likely lose about half to three quarters of one percent (or more) of our Gross Domestic National Product (GNP). And this to an economy that is merely treading water—with an unemployment rate that is much higher than reported (because so many people have given up on looking for a job—-called “non-participants”).

So, let’s hope that some sanity, and some leadership, will somehow return to our nation’s capital. This time, the stakes are way too high for anything else. But given the personalities involved, I fear the worst. Even though Boehner has said privately that he will not allow America to default, there are simply too many crazies running the asylum (and besides that, Boehner promised we would not shut down the government so his prognostication skills are as weak as his leadership).

And that is why I fear that this could be another “Tarp” moment. Smarter people than I say I am dead wrong and I pray they are right. The last time the congress (this time the 112th Congress) voted against a bill to save Wall Street, we lost 777 Dow points in a single day, and more than 15 percent in two weeks in August of 2011. That is why I sure hope that this time, the past is not prelude.

Please stay tuned for frequent updates as we navigate through this terrible situation.

—Jeffrey A. Krames, October 5/6, 2013

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