“Gravity” in Washington — Not Gravitas

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I went to see “Gravity.” It is one of the great cinematic experiences ever. It is to this generation what “Destination Moon” was in 1950 — and with one of the same scenes: the use of compressed gas to propel a person in space. (See it at 54 minutes.)

The movie hinges on a catastrophe: a break-up of the satellite belt by flying debris. That threat has been known for over 30 years. It is called the Kessler effect. Statistically, it is going to happen at some point, unless some technological solution is implemented. It comes because of the attempt of governments to deny this law of economics: there is no such thing as a free lunch. Space is not a free dumping ground. At some point it will fill up enough to create a chain reaction of junk. It will destroy communications satellites. As George Clooney says in the movie, Americans will lose access to Facebook — the ultimate catastrophe, I guess.

This week, the politicians are once again trying to deny economics. They are seeking another round of free lunches by hiking the federal government’s debt ceiling. This way, the Federal Reserve System will be able to buy $1 trillion a year in IOUs issued by the federal government. That is Washington’s version of the free lunch. Quantitative easing does not hike consumer prices, we are assured. Also, it keeps long-term interest rates down . . . or did until May of this year.

Then, without warning, in mid-May, long-term rates started rising: Treasury bonds and mortgages.

FREDrates2013Also in mid-May, the Treasury Department began cooking the books to conceal the fact that the federal government had crashed through the official debt ceiling — rather like the Soviet union’s blowing up a satellite in “Gravity,” which triggered the chain reaction of space debris. Think of both as “extraordinary measures.”

In “Gravity,” NASA tells the temporary residents in outer space that the cloud of debris will hit them in a matter of minutes. They have to get back to earth. But they don’t have enough time. They get hit. Then, like clockwork, they will be hit every 90 minutes, until the debris finally enters earth’s gravity and is burned up.

That reminds me of Congress. It is frantically trying not to be hit by fiscal debris, scheduled for October 17. Unlike NASA in the movie, the guy at “mission control” at the Treasury, Secretary Lew, says that he is not sure that the impact will hit on October 17. It may be longer. It all depends on his book-cooking efforts to hide the fact that the federal government crashed through the debt ceiling on May 17.

In the movie, the voice of mission control is provided by Ed Harris, resurrecting his role in “Apollo 13.” This time, however, he is not confident of a resolution to the “problem.” He reminds me of Secretary Lew.

We are told that the Senate will work it out soon. We are told that the House will work it out soon. Movies always turn out well in the end.

It will all work out well, as long as we assume this: there really are such a things as a free lunches — in outer space and in Washington, D.C. “Kessler effect? It’s a myth. Perpetual debt ceiling hikes? No problem. Quantitative easing with no price increases? Why not?” For Washington politics, that’s gravitas.

But the Keynesian fiscal and monetary debris in Washington will eventually become a chain reaction. That’s when you will want to be in a higher orbit — or a lower one.

Paraphrasing Jim Lovell: “Washington, we have a problem.” Washington is the problem.

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