Trump pushes the US to the ragged edge

The federal government shutdown showdown of 2019 between Capitol Hill Democrats and President Donald Trump keeps setting records as it enters into its 26th day. The previous longest federal shutdown in U.S. history was the 1995-’96 face-off between Speaker Newt Gingrich (leading the first Republican House Majority in 40 years) and President Bill Clinton. That shutdown lasted into the 21st day, and it may not be a coincidence that this happened just as 24-hour news coverage on cable TV had reached a critical mass. A theory: The spectacle and the drama of federal government shutdowns, with the resulting publicity, impels the political-media complex to these antagonisms and resolutions. The problem for the federal government is this newly disruptive level of budgetary brinksmanship diminishes its credibility and creates instability in the economy.

The current, nearly month-long government shutdown is over $5.7 billion in federal funding to build more barriers on the border of the United States and Mexico. Donald Trump won’t sign the next appropriations bill without it, and House Speaker Nancy Pelosi won’t send him the $5.7 billion for his border wall. It’s interesting he didn’t get the funding when Republicans were in control of both Houses of Congress for his first two years as president.

It’s not like for instance, Barack Obama’s $787 billion appropriation for a federal “stimulus package” (The American Recovery and Reinvestment Act of 2009), which was passed without a single Republican vote in the U.S. House. Or “Obamacare” (The Patient Protection and Affordable Care Act of 2010) which was passed the following year without a Republican vote. In December, the stock market had its worst December since the Great Depression and its worst Christmas Eve trading day ever, leading the S&P 500 into a bear market on Christmas Eve after plummeting more than 20 percent from a previous high. The market for equities has entered a bear market if there is a drop of 20 percent or more after a recent high, and has often preceded long-term declines in equities markets.