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Things I Worry About – Economic Disaster Version

The debt ceiling crisis – it’s getting worse:

Time to get scared about debt limit armageddon
By Jonathan Bernstein:

House Republicans seem to really buy what Michele Bachmann and others are selling: that there is no real debt limit deadline, and that default isn’t a big deal anyway.

Several weeks ago, former Obama Administration OMB Director Peter Orszag predicted that it would take a financial market panic to get this done. I guess what scares me now is: what happens if the Dow drops 2000, 3000 points…and House Republicans take it as a signal that they’re on exactly the right track? What if Rush Limbaugh and Fox News interpret a market panic as a sign that it’s time to double down on tax cuts and Medicare cuts?

Connecticut’s deficit – there may be some hope:

Can unions find way to make everybody happy? by Brian Lockhart

One union source yesterday said one likely scenario is for union leaders to agree to alter their rules to allow the 26 bargaining units that voted in favor of the health care and pension givebacks to accept them, and the eight opposing units to continue operating under the status quo. This is being referred to as the “yes/no” solution.

The rationale is this approach would be a way for union leaders to push through the deal they negotiated, cut back on the thousands of layoffs and other deep cuts Democratic Governor Dannel Malloy is now pursuing, and still respect the rank-and-file “no” votes.

But it will be at least one month before this scenario becomes a reality because, under union bylaws, leaders cannot vote on any rule changes until 30 days after they’re proposed.

The Greek Crisis- things are a little better:

Greece’s 300 legislators debated, and finally approved, an internationally backed financial-rescue plan with many clear downsides—it will pile pain onto hapless firms and citizens who already pay taxes, for instance, and so subsidise those who do not.