July 30, 2011
Today will be about the 36th day of above 90 degree weather here, most of it well above and six of them 100 degrees or above – with more of the same for the week to come. That is nothing compared to the suffocating blast of hot air out of Washington that has engulfed the country since May over raising the debt ceiling – a task, usually so ordinary that it has been done 74 times since 1962 (ten times during the eight years of the Bush II administration).
As far as I can tell, from what I’ve read over the last week, the politicians have come up with two choices –crash the economy now, or crash the economy later – neither very palatable, if you ask me.
Right now, although the financial sector and large corporations have been doing very well, the real economy – down here where most of us live – sucks and is getting suckier. In May, that economy was shipped to ICU on life support, barely alive at less than one half of one percent growth. Last month, still in ICU, it feigned the tiniest of rallies at 1.3 percent.
So, with the economy still recuperating from an near-fatal heart attack and, now, suffering a life-threatening case of anemia, the choices seem to be these:
1) Congress fails to pass a debt limit increase, forcing the government to use what money comes in over August to pay the interest and principle on the debt rather than paying its obligations to “retirees, veterans, business owners, federal workers, active-duty soldiers, Medicare physicians and government agencies that need money to keep the lights on.” http://money.cnn.com/2011/07/28/news/economy/debt_ceiling_prioritizing_payments/index.htm These fifty-five million people, about one sixth of the population, will either have to reduce spending to bare essentials, themselves, or be tipped into insolvency and (in the case of small businesses, barely hanging on,) failure. And the stock market, dribbling losses over the last week, as it is, just goes ahead and crashes – pretty much taking the sick economy with it.
2) Congress passes a debt limit increase, but at the price of between 2.2 and 2.7 trillion dollars in cuts to government spending over the next decade. http://money.cnn.com/2011/07/29/news/economy/debt_ceiling_reid_boehner/index.htm The Empire’s financiers will breathe a sigh of relief; the stock market will rally; all will be well in the Empire. Until you look closely at these “savings”. Basically, the government will remove from an already near-death economy between 220 and 270 billion dollars per year, most of it from the same 55 million people and small businesses – and government agencies they depend on – that would be affected by the other choice, for at least the next ten years. Millions of people spending almost nothing above essentials for the foreseeable future; thousands of additional people cut from the work force as those small businesses struggle to survive or collapse. Perhaps tens of thousands more fired from government jobs as programs and agencies on the firing line cut costs to the bone. The economy grows sicker every year. The Empire borrows more; the Congress makes even more drastic cuts until we are caught in a slow death spiral that ends in a full code for the dead economy.
Now I am just one old woman with little real understanding of economic theory – be it Keynsian, Randian or Meiserian. Nevertheless, I could not stay a small tremor of apprehension the other day, while reading this article over at Market Watch, http://www.marketwatch.com/story/insiders-selling-at-unusually-fast-pace-2011-07-28 which begins,
“Bad news, stock-market bulls: Corporate insiders are selling their companies’ shares at an abnormally fast pace.
“In fact, one measure of that selling activity shows insiders of NYSE- and AMEX-listed companies recently were selling at the fastest rate since data began being collected in the early 1970s, four decades ago.
“On the theory that insiders know more about their companies’ prospects than do the rest of us, this is an ominous sign.”
In light of the two scenarios, I outlined above, it sure made me wonder if this was the financial equivalent of rats leaving the sinking ship.
So, this last week, I’ve spent a lot of time thinking about ways to increase the resiliency of my responses to both the heat from the weather and the heat from Washington.
One of the nice things about the hot weather is that it has forced me to get out into the garden early in the day instead of waiting. Until the sun makes it up over the old walnut tree by the alley, about 8:30 in the morning, the garden is an oasis of cool green shadow – a good time to pull weeds, pick vegetables and, on my allotted days, water the garden. Occasionally, on sprinkler day, I’ll get busy with some other chore around the yard until I realize the shade has disappeared and it’s getting too hot to stay out any longer. (I must confess that, at such times, I am not immune to the lure of “accidentally” wandering into the path of the sprinkler for a few moments – a practice I’ve discovered decreases my age by a factor of ten for at least that short while). I’ve learned to use a wet washcloth or towel, cooled in the air of the fan, to postpone turning on my air conditioner as late in the day as possible. I’ve found ways to cope with the drop in my garden’s production in this heat and ways to produce a meal without turning on the stove that I never would have dreamed possible a few years ago.
I suppose the same is true about the heat wave from Washington. I’ve certainly looked anew at how I would survive either a sudden loss of my social security income for a month or the slower loss of those benefits over the next few years. I’m pretty sure I won’t starve in either heat wave or lose my house. From there, I’m prepped and prepping for “anything goes”. It’s probably the best chance I have of keeping cool.
So, how are you holding up in the heat?