Please stop f***ing around with the economy

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I generally avoid politics here, because it’s bad for business. You never want to offend potential clients, investors, etc. with your idiosyncratic views.

That said, I’m going to take a moment of your precious time today to complain about the state of affairs in Washington.

No, I’m not going to place blame. I (obviously) have my opinions, but this isn’t the place to share them.

But I will say that I, and every other business-person with a brain, am fervently hoping that the dillweeds in DC:

  1. Avoid shutting down the government – This one is pretty straight-forward. Government spending represents something like 40% of the GDP of the country. While a shut-down won’t stop all the spending (things like the military and social security are exempt), it will definitely stop a bunch of it. And that will translate into a pretty large brake on growth, without even considering the impact of the consequent uncertainty on consumer and business spending, which make up the rest of the economy.
  2. Avoid defaulting on the debt – The one thing that we’ve had going for us since 2007 has been our ability to borrow cheaply, because US government debt is regarded as risk-free (or, the closest thing to it in investing). Even the threat of default is surely already causing some investors to consider whether they ought to park money in some other currency (Chinese renminbi? Euros?). This means less demand for US debt and, therefore, higher interest rates for the government to borrow. Paying higher interest rates on government debt means there will be less money to spend on roads, bridges, schools, healthcare, defense, parks, the space program, housing, etc. for a long time to come.

America is a wonderful country. We take punches and then we come roaring back. The economy is just starting to recover from the unpleasantness of the last five years. And now some MoMos in DC seem to want to push it back down by retarding growth and increasing our long-term cost of borrowing.

If you’re in business (or work for someone who is), you ought to be mad as hell.

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