As with any such clusterschnazzle, determining how it came about requires a time line.
The pundit class is holding Obama and the dhimmocrats equally responsible with the usual Rehooligan suspects in this. I'd agree, except for the fact that Emperor ConstantTeen took his whole first term to figure out he was not dealing with rational human beings "on the other side of the aisle," but with a mange-ridden pack of rabid coyotes.
Paul Krugman provides the time line:
1. Republicans engage in unprecedented hostage-taking, threatening to push America into default by refusing to raise the debt ceiling unless Obama agrees to a "grand bargain."
2. Obama agrees to it in an attempt to buy time.
3. Both sides decide that the way to buy time is to create a fiscal doomsday machine that inflicts gratuitous damage on the nation through spending cuts unless a grand bargain is reached.
4. Sure enough, there is no bargain, and the doomsday machine will go off at the end of next week. ...
So now I hear Dems are proposing a "middle-of-the-road" compromise solution consisting of spending cuts combined with tax increases. House Republicans say "No way, man."
But no matter, because both plans bite. What we need is for the gov to spend some money on an infrastructure binge -- sewer mains, water mains, bridges and overpasses, etc, and also subsidies for energy generation for today and tomorrow. We're going to have to do all that stuff at some point anyway, and we really need to take some other action besides watching the Social Security trust fund go down the drain. Seriously, Screw Austerity and the horse it rode in on.
Because we do not -- DO NOT -- have a spending problem. At this point, I'd say our biggest government problem is bare competency.
Where are the jobs we need? The economy sucks because people don't have jobs, and don't have any money!!!