Well, the global stock markets have responded to the "debt deal" with a quick downward slide. The Dow is continuing its plunge - now down 850 points over the past 8 days.
The basic fact in all this is that the US debt was never really the problem. This totally unnecessary crisis was created in whole cloth by Republicans. While the Republicans, led by their extremist right-wing, held the country hostage over the debt ceiling, no action was taken to solve the real economic problem - jobs. And now with "The Deal" taking huge amounts of government money out of the economy, there is little hope that jobs will be created any time soon. And until jobs increase, there will be no growth in the US economy. Enter the double-dip recession.
Obama's encouraging Business to create jobs and Congress to send him a jobs bill is a little like asking the burglars for whom you just opened the door to your home to help you with your gardening. Fat effin' chance. Let's face it - supply-side economics is in the driver's seat and it just doesn't work. Politically, Republicans will win both houses of Congress and the Presidency in 2012 if the economy doesn't improve. There is absolutely no political incentive for them to cooperate. So much for the effectiveness of the the Compromiser-in-Chief.
As usual Paul Krugman provided some excellent insight into The Deal in an August 1 NY Times article. After analyzing how The Deal fails on so many levels and is bound to lead the country into further economic problems, he concludes: "What Republicans have just gotten away with calls our whole system of government into question. After all, how can American democracy work if whichever party is most prepared to be ruthless, to threaten the nation’s economic security, gets to dictate policy? And the answer is, maybe it can’t."
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