Collapse of the Western World's Economic System... Why Not?

"A lot of [House Republicans] believe 'enough chaos' would make opponents yield"
      
           - House Speaker John Boehner (R-OH)
             on his colleagues in the House of Representatives.

I remember when I was learning to drive, my dad would give me advice regarding not getting into accidents. Every so often I would say, 'Yeah, but wouldn't it be the other person's fault in that instance?' To which his response would be 'You're right, but would you total your car on principle?'

Good point.

It raises another question, though. What if you were trying to total your car? Without taking the metaphor too far, I feel like the Tea Party Republicans want the economy destroyed, not just to push some of their ideology to the legislative limit, but because of some inane theory that economic collapse will reflect badly on the president, not them, and that would be a good thing. If the timing of this had not been so terrible, I would dismiss this brinkmanship as politics as usual. But as things degenerate in the Eurozone as well, it looks like a double-dip recession is all but guaranteed.

While Mr. Bernanke contemplates another round of quantitative easing, the 'chaos' has spread across an ocean. Greece, the original of the PIGS nations (Portugal, Ireland, Greece, Spain) now seeks a second bailout as the debt crisis has expanded to include Italy. The weak economies of the Eurozone are now pushing for a Euro bond, while the strong economies (notably France and Germany) hesitate, as such an issuance may affect their credit ratings. Finland asking for Grecian collateral to limit their exposure to bad debt has sparked an unfriendly debate among the other strong economies.

If banks in Europe are tight on credit, it will become more expensive to borrow money here in the states, despite whether or not the Fed decides to proceed with another round of quantitative easing. However, if QE3 does go through, there is no guarantee that the banks will be any more liberal about loaning money as the model of quantitative easing suggests they should. If companies are left without access to credit, then growth, unemployment, and tax revenue will stagnate, and we will begin the cycle anew.