US lawmakers pulled the nation into a government shutdown crisis in a 'financial terror tactic'
Federal institutions have been closed down and hundreds of thousands of Americans have been forced to go on unpaid leave, with the country now headed towards a possible default unless the debt ceiling is raised by October 17.
But some key federal agencies and bodies including Congress remain operational, with lawmakers still receiving their paychecks.
Wide Awake News founder, Charlie McGrath, blames Congressmen for orchestrating the crisis. His view is backed by NYC-based economist Max Fraad Wolff, who also says he can’t imagine a recipe that would undermine confidence in the dollar and the US or particularly the US government, faster or more effectively than the US crisis.
LF: "Is it fair that Congress is still drawing a paycheck, while hundreds of thousands are on a pay freeze?"
CM: "Congress still getting paid is not fair. It’s a financial terror tactic: if we inflict a bunch of pain onto a million people then they’ll be more sympathetic to let us continue to spin our nation into oblivion. This isn’t a surprise – this standard operating procedure between both the Democrats and Republicans."
LF: "So if the lawmakers’ salaries are apparently not affected by the shutdown, do you think this affects their willingness to even solve this problem?"
CM: "I don’t know if it’s the fact they’re still drawing a check. Most of them are multi-millionaires, certainly doing far better than the average person in this country, that they claim to represent, in most cases. I think they’ll use this crisis as they’ve used other crises to get their agenda moved forward. I don’t know that the fact they’re still drawing a paycheck doesn’t motivate them. I think trying to get their political will done is the motivating factor for letting us shut down the government."
LF: "So members of Congress are financially faring, year after year, better – and we’re obviously seeing that in the numbers, and it just seems like the ability of the legislator to get things done is deteriorating. Do you think there might be a loss of touch with reality up on Capitol Hill?"
CM: "Oh yeah, without a doubt. This is the United States of America – the richest country in the world. We have 49 million living in poverty, 48 million of them are on food stamps. The last government shutdown (1995-96) we were sitting under a Trillion dollars in sovereign debt. Today we sit at 17 Trillion dollars. 20 million people unemployed. Is there a disconnect? That is an absolute understatement. Washington DC, I truly believe, does not understand what the average person in this country is going through."
LF: "So instead of improving the lives of people domestically, it seems like some of these politicians are only capable of playing brinkmanship. Is that even what they were elected for? What are people saying about how out of touch with the needs of the citizens these people actually are?"
CM: "I think that most people, even in the mainstream, are starting to understand that Washington DC does not serve the people that elected them, in most cases. That’s not saying all 525 members of Congress are out to get their constituency. But it sure seems like the people that stay there for decades at a time – they control the legislation, they decide what gets to be talked about on the floor of the Congress or the Senate. These people are there so long that it’s obvious they’re special interest-driven. They’re there to make sure they corral in the tax dollars for the special interests that help fund them and keep them in a position of power. They’re completely out of touch. The people in this country will continue to suffer, we will see more austerity coming. We will see eventually, I don’t know if it’s this time or down the road, a crisis with our dollar, a crisis with our debt, and a true government shutdown that’s going to take most people, I think, by surprise."
LF: "What you say is interesting about these people who are essentially career politicians. Some of them perhaps can’t even remember the last time they didn’t draw a government paycheck from serving up on Capitol Hill. Does this point to a fundamental flaw in the system, seeing as how many times a government shutdown or partial shutdown has happened?"
CM: "My personal opinion is yes, it does show a flaw in our system. One simple thing that could fix the flaw in our system is simple term limits. Our President has term limits – why don’t we have term limits for our Senators and our Congressmen? These people sit there and they amass so much power and so much influence, but look what it does for the nation: it puts us in this stalemate, in this battle every three months or six months. It literally terrorizes the people of this country – not knowing if our economy’s going to implode because we’ll get downgraded by one of these rating agencies, or if we’re going to spark a global economic collapse because we want to sit here and squabble back and forth in Washington DC. So I think the system is flawed. We need to get special interests out of our system. We need to stop letting the financiers on Wall Street write the legislation that governs the financial market. We need to impose term limits in this country, so we can get some of these career life-long multiple-decade long politicians back to their states, where they belong, and get some true leadership in Washington DC."
Global markets were shaken in the hours following the US government shutdown, but eventually rebounded towards the end of Tuesday. Nevertheless, some analysts say the crisis in America sends out a strong negative signal to the financial community.
Here’s what NYC-based economist Max Fraad Wolff had to say on the crisis to RT’s Bill Dod:
BD: "Will investors be seriously put off by what’s happening in Washington?"
MFW: "We’ve already seen a multi-hundred billion dollar global equity market slide. The truth here is: what the federal government of the US and Congress and the White House have exhibited rather aggressively over the last several weeks, including through the shutdown of today, is that there’s literally nothing the US government can’t and won’t do for unclear reasons, sending whatever shockwaves they feel like sending into the US and global economies. I can’t imagine a recipe that would undermine confidence in the dollar and the US or particularly the US government, faster or more effectively than what we see on every news channel in the world, every day for a week and counting."
BD: "So the US global reputation is at stake, but does it do for the people domestically, economically – apart from those of course who are already facing a lack of wages?"
MFW: "We’re already starting to see hundreds of thousands of people get a furlough – which is the sort of weird phrase turn we like here in the US – which means that they have an involuntary, unpaid vacation. Those hundreds of thousands of people aren’t going out to dinner, they’re not going to the dry cleaner, they’re not buying a new car, they’re going to have trouble making house payments, they’re going to have trouble making mortgage payments and rents and all the rest. We have five million people directly employed by the federal government of the United States. Twenty million more Americans are dependent on them. And 315 million Americans, the whole country is dependent on various functions done by the federal government. And that’s before we even get into the very important, but difficult to quantify, reductions in consumer confidence and business confidence – which will result in less spending, which we’ve already seen take place over the last week."