Wednesday, October 9, 2013

The conservative bubble revisited

I wrote a piece early this year called "Who's Kidding Whom?" (appearing online as "Who's Kidding Whom on Bubbles?"), in which I discussed bubbles, both in the market sense (price bubbles) and in the information sense (living in a bubble). I argued, or acknowledged, that conservatives had been operating in the latter type of bubble, filtering out undesired information and believing dubious ideas transmitted mainly among themselves. I also argued that conservatives were not alone in living in such a bubble, in that Occupy Wall Street had its own insularity and that Wall Street itself also had such tendencies (including the financial advisors who were my targeted readership).

Subsequently, I expressed some optimism that conservatives were emerging from their bubble, rethinking their assumptions and perceptions, such as when I noted that even so staunch a conservative as Victor Davis Hanson was advising his readers to "beware the cocoon."

Well, I was wrong on the latter point. Such a reemergence may occur someday, but right now the trend is in the other direction. Conservatives are doubling down, embracing their worst and dumbest ideas with an unprecedented fervor. There will be a reckoning, for them and for the country.

The idea that the government can not raise the debt ceiling and then just reprioritize its payments so it doesn't default on debt or damage its financial standing is so wrong, so horribly misinformed, that it can only be a product of the most egregious self-delusion. The federal government sends out many millions of payments a day. Even if it could competently get its interest payments out while allowing other bills to wait, this would cause economic and legal chaos. Even the possibility that there could be a failure to raise the debt ceiling is rattling financial markets as we speak.

I can only look with appalled amazement at my congressman, Scott Garrett, whose stance in the current standoff over the shutdown and debt ceiling doesn't even make sense on its own terms. He recently--within a day--announced first that he'd vote against a debt ceiling deal unless it included a defunding or delay of Obamacare--and then that what he really required was entitlement reform, evidently bringing Medicare and Medicaid and Social Security into the mix. He will fight to the end for ... whatever pops into his head. The affluent Wall Street types who live around me in Garrett's district, among many others, will not be amused by the consequences of that bitter-endism.

The conservative bubble is thicker than I thought, and its bursting is going to be nastier than I expected.

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