The standoff, which took the nation to the brink of default on Aug. 2, threatened "fiscal Armageddon," the White House said. Wall Street trembled. In the end, Congress and the White House agreed to raise the debt limit, including the creation of a joint congressional panel to come up with at least $1.2 trillion in additional deficit reduction – or, failing that, automatic spending cuts of the same magnitude in 2013.
Even after the debt-limit deal, Standard & Poor's lowered the US credit rating, on the grounds that Washington hadn't demonstrated the capacity to set the nation on a sustainable fiscal course.
"There may not be an issue of such gravity and magnitude, at least on the domestic side, that any Congress has faced in modern times," said Senate deputy leader Richard Durbin (D) of Illinois, at a rally on Nov. 16.
Why no reaction? Look at Europe.
Yet the failure of the 12-member super committee to agree to a plan to cut the deficit by $1.2 trillion – not even 3 percent of the $43.9 trillion that the United States is expected to spend over the next decade – barely stirred a reaction.
No fiscal Armageddon. No catastrophe. No flight from US Treasury bonds. Only a new round of partisan finger-pointing – and some recriminations within GOP ranks over lawmakers who even considered raising taxes as part of a deal.
The US national debt has now roared past $15 trillion, up from the $14.3 trillion breached on Aug. 2. The government still borrows nearly 40 cents for every dollar it spends. Soaring health-care costs still threaten to drown Washington in red ink.
