Notes From Dysfunction Junction

October 16th, 2013 at 9:16 am

I’ve been sparing my readers the blow-by-blow on the shutdown and debt ceiling.  First, it’s way too depressing; second, it’s not worth our time to track every head fake, as seemingly important developments turn out to be dead ends.  From the very beginning, it seemed to me and others–this is no great insight–that the end game had to be Speaker Boehner letting a bill pass with mostly D’s.  And that’s what I hope we’re looking at, perhaps today.

And of course, that just ends this benighted chapter.  The next one starts right away.

I will soon get down to a careful an analysis of the economic damage that’s being done here.  I think it goes well beyond a few basis points off of GDP in this quarter, that we then gain back in the next quarter.

(I’m also working on a long piece on wage determination that I think folks will find pretty interesting.)

But for now, I wanted to just draw your attention to this nicely done piece from the National Journal, an anatomy of how the House once again snatched defeat from the jaws of victory yesterday (and yes, I know that short-term patches are no victory, but you know what I mean).

The piece provides an excellent microcosm of the fundamental dysfunction of the situation–how the participants in the fight are not just talking past each other, but are using different systems of logic.  It’s as if you were trying to build a machine with someone who’s math maintained that 2+2=5 and triangles have four sides.  It’s not just that you speak a different language; it’s that your realities are unrelated.  You define things differently; your behaviors and incentives are not just different from your opponents–they’re unrecognizable to them.

This sentence for the NJ piece summed it up for me.  The House leadership had already thwarted a deal yesterday by adding unacceptable terms to the bi-partisan Senate bill.  But even with those deal-killing additions, the extremists who are still running the House were unsatisfied:

Why, they questioned their colleagues, should they have endured two weeks of shutdown—not to mention a drubbing in the polls—in exchange for a package of benign policy concessions that few of them were agitating for when the fight began?

They “endured” two weeks of shutdown?!  They want something back for their “drubbing in the polls?!”

I’ve been put off by most of these “terrorist” and “hostage” analogies, but this is a toddler who wants to be compensated for the anguish she suffered during her meltdown.  It’s a thief arguing that the judge should give him back some of the loot because the damn trial was really stressful.

You can no more deal with these people than you can discuss philosophy with a tree.  The only way out is for Speaker Boehner to bring the Senate bill to the floor and hope like hell that there are at least 20 R’s who haven’t lost their minds.

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5 comments in reply to "Notes From Dysfunction Junction"

  1. Tom in MN says:

    But discussing philosophy with a tree would be less depressing.


  2. alex zaffron says:

    Wow. Like your analogy about the tree. Not dissimilar from my favorite: ‘It’s rather like yelling at a telephone pole to get your power turned on’.

    In any case, my prediction that it would take a seismic market action to provoke a solution, and that that market reaction would occur before, literally, the moment of technical insolvency, did not occur. Have supposedly rational markets become immune to insanity? Wonder what your thoughts are on this. WTF?


  3. Alex Zaffron says:

    Addendum to previous: Reviewing the charts, the big tank from 2011 accelerated on the S&P downgrade which occurred after the shenanigans were over with. Many at the time thought that was baked into the cake, and were caught by surprise.

    Given that Fitch has placed us on ‘negative watch’, would it be unreasonable to expect Fitch to follow the same path as S&P in this round? If this occurs, then the already substantial damage done by this fiasco is likely to be compounded.


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