NEW YORK (TheStreet) -- Winston Churchill once said, "We can always count on Americans to do the right thing, after they have exhausted all the other possibilities." With all of the posturing and grandstanding that have taken place so far this year among the political parties, here we are, like the boogieman, the government shutdown is finally here. In some circles, it's been proclaimed as Armageddon. But based on what the stock market has done, this description seems overly sensationalized.
I'm not making light of what is truly a serious fiscal issue. But frankly, I don't see a reason to care. That Washington wants to play a game of chicken with the lives of those who have placed them in office is indeed a travesty, if not criminal. It's not as if the U.S. doesn't have the money. While we're allowing the politics to get in the way, how can we truly prioritize what gets paid and what doesn't? The short-term solution to fund services like Medicare, on which many of our senior citizens rely, is a step in the right direction. But that, too, only reminds us of the many Band-Aids that are being applied to surgical-required issues on which Congress and the president have been unable to agree. Even though both sides have done plenty of talking, no one wants to take a stand.
It's fine if you disagree with the corporate structure of Boeing (BA). If the defense contracts given to Halliburton (HAL) and Lockheed Martin (LMT) offend you, I understand that, too. But we can't allow those who are putting their lives on the line in battle to become pawns in Washington's political chess match just because a faction of our government disagrees on defense spending. Every sector and government group has to be willing to do their part.
This is the same government that averted another great depression by instituting "too big to fail." The president and Congress caught a great deal of criticism for saving "big corporations." But this was possible solely because there was a "big government" available to come to the rescue. Truth be told, I never did agree with that policy. But I also appreciate that a central issue in that decision was (among other things) the number of jobs that would have been lost if, say, Bank of America (BAC) (and others) went bankrupt.Fast-forward five years later, given the meaningful progress our country has taken since that credit crisis, there's no denying that saving "big business" was the right decision. So I'm not going to be scared into thinking that this "shutdown," which was preceded by a sequestration in March, and the debt-ceiling issue before that, is as significant as the credit crisis of 2008. As Churchill noted, we always know what the right thing to do is -- it's just not in our DNA to get it done when there is still a full deck of cards to play. So here we are. While this is not the first ever shutdown the U.S. has faced because Congress and the president are at a stalemate on a spending bill, I think it's a mistake to assume that this will have the same effect. A lot has changed since the U.S. faced a partial shutdown in 1995-96, which left not only federal employees and citizens confused about the effect of the shutdown, but also had those in Washington, while under President Bill Clinton, wondering what to do next. What I do recall, though, is that Clinton left office in 2000 with a budget surplus. Here again, Churchill's sentiment proves prophetic. And contrary to what I'm reading by some media pundits, I don't believe that our current situation is beyond repair. Given the extent of the progress of our economy, I'm not opposed to a slight increase in tax revenue. At the same time, there's plenty of value in a more "efficient" government (I won't say "smaller") that is willing to spend less. But this is not just about politics. There are real-life implications here. The "shutdown," as it sounds, is actually shutting down real-world progress. There is scientific research that has lost financing. How many years of work will we be set back if NASA closes for a week? Also, what are we to do without the work of the Food and Drug Administration? Let's, then, remove the nutritional labels from the things we eat. Can we trust the calorie count will be accurate? Speaking of nutritional value, we can't ignore that the government doesn't have the capital to finance agencies like the National Institutes of Health, which conducts extensive health research. And we can't ignore what this shutdown might mean for many health care service providers if the government is no longer able to subsidize payments for things like research grants -- the type used to improve (among other things) more efficient testing and better medical equipment. If doctors are unable to improve their efficiency, it will mean that, we, as patients, will have to pay more because we are seen more frequently. It sounds crazy to say, but I believe this shutdown is exactly what the government wanted. (I'm not going to say "needed.") To that end, given how corporations have yet to loosen up their purse strings to spend on things like infrastructure investments, I believe they've been preparing for this. The good news, though, is that earnings haven't been that bad, and by virtue of corporate fiscal awareness, things actually look brighter if/when this shutdown is lifted. In the meantime, the game in Washington will likely continue until that last card is played. Unfortunately, by holding Americans hostage, members of Congress don't realize that they've already lost. I wonder what Churchill would have done instead? At the time of publication, the author held no positions in any of the stocks mentioned.
This article was written by an independent contributor, separate from TheStreet's regular news coverage.
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