This crisis was manufactured by right-wing nut-case politicians in the US Congress. It's mindboggling that the same congress passed a budget earlier this year authorising expenditure then refused to pay the bills when they came due.
If the tea partiers who have captured the Republicans had their way, no public employee, soldier, superannuitant or unemployed would have been paid this week. If you want a revolution, all a state has to do is stop everyone's pay.
That's what the tea partiers were courting.
There was Orwellian irony seeing "communist" China, now the US's biggest creditor, lecturing "capitalist" America on its financial responsibilities.
It's extraordinary that President Barack Obama caved into Tea Party demands to slash spending and keep tax loopholes for the rich as their price to pay the Government's bills.
The tea partiers are crowing and everyone now seems resigned to the nutters now running the asylum. Obama may even lose his re-election next year as a result.
As punishment, China downgraded the US's rating this week and it's inevitable that other financial rating agencies will follow.
The US was proudly the world's first democracy and the Americans for generations have inspired the world. Its form of government has been heralded as an example of real democracy that expresses the will of the people. This week it was seen for the sham it is.
The country's official unemployment is more than 9 per cent and is people's number one concern. Poll after poll show people want more expenditure on jobs, health and education. Yet the tea partiers - funded by the super wealthy - have forced the Obama administration to cut these three items.
Until now every sane economist will tell a government to spend money when an economy needs to grow. This country is going in the opposite direction.
We are use to having a parliamentary democracy in which our country's leader, always the head of the biggest party, is elected by a majority of MPs and consequently commands enough votes in the house to appoint a cabinet and guarantee supply of funds to operate a government.
It is amazing to think that in the US you have a Democrat Party president who has to rely on a Republican Party-controlled congress to approve his funding; a senate where 60 per cent of its members are needed to approve his cabinet ministers, departmental heads, judges, and ambassadors. Even then any senator can effectively block any appointment or legislation.
If that isn't enough Obama has a Supreme Court with a majority of Republican appointees approving laws allowing corporations to give unlimited amounts of secret funding to politicians.
The victory of the tea partiers, who were willing to drive their country off the cliff, shows how dysfunctional its political system is.
Obama was the great "change" candidate who just got screwed by the system he pledged to reform.
In New Zealand, we have a referendum later this year on our political system. After watching the US mess I've come to appreciate that despite a few minor matters our MMP system is pretty good.
It allows an array of diverse political voices but allows a stable responsible government.
Unfortunately we can't say the same about the US.
