Government Super Commission Deadline Approaching

The Government's super commission on debt is fast approaching it's deadline for making a deal before automatic spending cuts take place.

It's hard to see the commission coming to an agreement, and it's hard to see the commission not coming to an agreement. The issues are the same as with the debt ceiling debacle in late July and early August. Neither side has shown more flexibility in the issues.

The problem is that if an agreement is not reached, automatic spending cuts will occur, which, in the ensuing months, will result in a significant push back by the public and at the polls.

After all, just about everyone seems to favor spending cuts. However, when the question is to cut spending that affects the person who is asked the question, the poll numbers change dramatically towards no, especially if it involves Medical and Social Security.

Apparently when people are asked if spending cuts should happen, they assume it will be spending cuts elsewhere and it will not affect them.

Some of these cuts will be severe and will affect many programs, such as Social Security, Medical, and popular programs such as farm programs, education programs, small business administration small business loan programs.

European Debt Crisis Averted

The European debt crisis has been averted, and nervous markets have picked up and recovered.

This story was not of tremendous interest on the "west side of the pond" but most European citizens and many finance ministers understood the chain reaction that could have occurred if Greece and some other countries began defaulting on their debts.

A default by Greece would force some European banks to have potentially have fully charged off the full value, or close to the full value of the debt, which could have, or would have caused tremendous losses and a major burden for many banks. A failure by any of such banks that have significant debt holdings in Greece can put the banks stability at risk. Any large bank failure will have devastating effects on the Euro markets for years.

Crisis averted for now.