Monday, August 1, 2011

Recession Guaranteed

      Our Congressional economic experts have finally agreed on a compromise that will enable them to raise the government's debt ceiling. That's good news, right?
      Well, yes and no. Yes, because the nation will be able to keep its promises to creditors, and no, because they have just guaranteed that the longest recession since WWII will continue.
     The agreement cuts government spending by more than $2 trillion over the next decade. The exact targets of the slashing ax are yet to be established, but supposedly all expenses are on the table.
     If Congress cannot agree on the exact items to be cut by the end of 2011, spending cuts of $1.2 trillion across much of the federal budget, including the Pentagon, domestic agency budgets and farm subsidies, will be triggered. Many federal benefits programs, however, would not be hit by this contingency, including Social Security, Medicaid, veterans' benefits, and federal retirement benefits.
     A reduction in Federal spending means that jobs are going to be cut; whether it will be Federal employees directly, or employees of Federal contractors and subcontractors, people are going to be thrown out of work.
     A portion of the savings is expected to be obtained by winding down the military operations in Iraq and Afghanistan. Adding hundreds of thousands of service people to the domestic labor market, which is already losing tens of thousands of jobs each month because of the normal increase in population, will only compound the problem.
     Subsidies to the states will be cut, leading to more job losses. Highways and other Federal and State construction projects will be canceled. Given the makeup of the current Congress, the healthcare system will be a big casualty.
     However, if you are dependent upon the financial world for a living, your disruptions, if any, will be temporary and minimal. Read the series, “The recession is over for some people...” dated February 16 through March 18, 2011, in this blog to find out why.
     Although Category four is probably home to some non-ethnic jokes, I couldn’t find any. Because I promised an example for every category, I submit the following with my sincerest apologies:
     Distortion of Pronunciation – There Are Only Seven Jokes.

There Are Only Seven Jokes” and “The Spirit Runs Through It” are 

available in paperback, or at the Kindle Store.

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