—The fiscal cliff coming in 2012 is so big, it’s good, because it will have to get fixed.—
Baloney. Greece “has to be fixed”. How’s that going for them?
Any politician proposing the kind of austerity that would be required just to give us a fighting chance would be voted our so fast he’d never see it coming. If he’s running for office he might as well give up. The problem, as in most democracies, is the electorate. They will not support politicians that do the right thing. They vote their wallet.
Ultimately, the final option will be to monetize our way out of this. It is the only “solution” that is politically possible. Of course, with the amount of foreign debt floating around the world this time, that will lead to a very unpleasant war.
I think you are right, about the voting of the wallets, and so I try to relax, because there are forces at work here that are historical phenomena, and this government, or system of government, is not able, as constituted, to address them. This is why it reminds me of Weimar Germany. Reasonable people know that a collapse is coming, but it is not possible to marshal the political will to address it proactively. Perhaps it’s like a storm, a social storm. You can’t stop it. All you can do is try to take cover.