Tuesday 4 December 2012

Your Fiscal Cliff Is My Mountain To Climb

In the USA, President Obama, his team and Congress have to work out what to do next.  Their fiscal cliff has been in sight for a long while and has come closer as the debate goes on in the bus of state as to whether to turn right or left or just stop or reverse continues. 

In the UK we have our own fiscal cliff and the Chancellor will have something, or not much to say about it.  Almost everyone will disagree with him.  Unluckily, it will be worse in that those who do will be entirely at odds with each other.

Meanwhile with The Continent, i.e. Europe going into isolation they have a wide range of cliffs on offer, except apparently in Germany.  Even the French have stopped buying their state produced cars.  The trouble is that Germany may be obliged to pick up the pieces of those who do fall over one cliff or another.

The Euro men in Europe are threatening to divert their money flows from London to ensure they can control them.  This has the effect of brining down a fog which will make the as and when the edge of the cliff here and there is reached nobody will really know.  It will only when we hear the screams that we can be sure.

This leaves all us taxpayers and consumers with mountains to climb.  When that is done we may then have our own personal cliffs to fall over.  There is talk of increased sales taxes, various ways of attaching property and other devices to take more and more money from us.

The essential difficulty is that if an economy has been run on extreme debt and consumer spending with delayed paying it arrives at the edge of reason.  Because our mountains are quite steep, and we can neither consume at the same rate nor pay off debt quickly and successfully then we may be climbing the cliff.

Trying to climb a cliff when the government is falling off it seems to create a range of hazards that nobody wants or has really anticipated.  We have not had a crash like this for some time and then in the past the situation was very different.

More to the point in the past people had very different attitudes to both money and the personal lifestyles that they felt were appropriate to their needs and standing.  Adjusting to a life without much money, security and which is a long hard slog against adversity isn’t in the modern books of marketing or government management.

In the more critical reaches of the web where there is discussion on economic matters that are alarmist and scary there are many tales of woe about the deceits, frauds and lesser known crises under way.  They range from gold to dirt with everything in between.

In the UK at present there is a real debate about whether our particular form of democracy is defunct and unworkable.  In the USA, it is argued that California is now such a liability it might be better if it became a sovereign state.  In Europe stresses are building up in other nation states.  Will we see a renewed Kingdom of Bavaria?

We seem to have elites which no longer fund public buildings in their home areas to impress people or support local sporting or cultural activities.  They buy yachts and homes elsewhere and take their money away.  If they stop paying tax and the rest of us cannot fund governments at their current spending levels then we may be happy to see our governments go into history.

The maps of some parts of the world have changed radically in the last century or two and down the centuries past the story is one of persistent change.  There is no reason why another series of major changes should not be under way.

The lesson could be that if you do not want to go over the cliff you do not climb the mountain.

1 comment:

  1. The next big trend is going to be indivual countries splitting apart. Scotland; Catalonia, Basques; Northern Italy (who would love to be rid of the corrupt South and Sicily).