Time for tea, or, What would Wilkins Micawber think?

“Annual income twenty pounds, annual expenditure nineteen nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."

— Wilkins Micawber

What do you reckon Mr. Micawber would think of Barack Hussein Obama, the soon-to-be one-term wonder?  The United States does not currently have a budget, because the people we elected to do the people’s business just laugh at that sort of thing these days, but we do know that BHO asked for $3.83 trillion and that the deficit is forecast to be $1.5 trillion.

There is no point in trying to imagine what a $1.5-trillion deficit means.  For most of us mortals, it is simply unimaginable.  All the more is a total federal debt of $14.3 trillion (and counting). And I haven’t even broached what I think of as the Williamson Warning (after Kevin Williamson, who gave prominence to the dour fact), namely that the real out-the-door, all-in price of U.S. debt is something closer to $130 trillion, a sum that, if you can bear to think about it, is Book-of-Revelations, Seventh-Seal, Four-Horsemen-of- the-Apocalypse scary.

I tend to think about Mr. Micawber when confronted, as we all are almost daily, with the realities of Obama’s fiscal incontinence (not, I hasten to acknowledge, that he has been the only one with bladder problems in recent memory, not by a long shot). Right now, today, the bad news (well, part of it) is that, unexpectedly!, unemployment once again ticked up, rising from 9.1 percent in May to 9.2 percent in June.

And this grim news comes as the August 2 deadline looms for raising the current U.S. debt ceiling of $14.9 trillion. Republicans, God bless them, are playing hard to get. (Prediction: they will eventually cave.) That lovable curmudgeon, Warren Buffett, said that Congress, by not raising the debt ceiling, was playing “Russian Roulette” with the economy. (Well, maybe, but why is the gun always pointed at us?) Buffet also said he could fix the deficit problem “in five minutes.” “You just pass a law,” he said,  “that says that anytime there is a deficit of more than 3 percent of GDP all sitting members of Congress are ineligible for reelection.” I don’t know whether that would fix the problem, but, hey, I think we should give it a try!

It is the bullet-in-the-chamber image that is getting all the ink, though.  There’s something about the phrase “Russian Roulette,” I suppose. CNBC ran a segment featuring two of its financial commentators, Michael Farr (speaking up for the Buffet warning) and Rick Santelli, the man who who gave the tea party its name and whose mantra is “stop spending, stop spending, stop spending.”

Mr. Farr kept warning viewers that “we’re running out of time” and that there may be “a bullet in the gun.” We’ve got bills in August of some 362 billion, likely cash receipts of about 203 billion. Unless we go further into hock (that's plain English for “raise the debt ceiling”), what are we going to do? It’s Wilkins Micawber’s problem all over again.

Mr. Santelli didn’t think Russian Roulette was the game we were playing.  (He didn’t say what we were playing: my own suspicion is that it’s some bizarre version of Monopoly.) There’s “plenty of money,” he observed, “to pay people who are owed interest payments.” This will avoid unpleasant action by entities like Standard and Poors and Moody’s. (How do you spell “Portugal,” “Greece,” “Ireland,” or “Spain”?) How about all the other stuff? Tough luck: it won’t get paid. But wait:

Who created the obligations? Congress. Let them figure it out. The answer is easy: spend less. . . .

Stop spending. Live within your means. I think what we need to do is live within the revenue intake, . . .  end of story and do not ask taxpayers for more money or increase the debt ceiling until you give us a budget. . . .

There are plenty of people that won't get program money. I understand that. But maybe the programs need less money, need to be streamlined.

There you have it folks: the solution, at least a large part of it, in just a couple of sentences.