I think people are missing the point, his suggestion is not meant to be taken literally. What he's trying to say is that reducing the budget deficit is more a question of political will than economics.
Very much this. If you want to predict behavior, look at incentives.
For example, the California state budget. There's a constitutional requirement that it be on time, but every year we were setting a new record for how late it was. Then, we pass a law saying that if it's not on time the legislators don't get paid. Mirabile dictu, the budget is now on time. Granted, the requirements for passing the budget were also lowered, but aside from that the Democrats were generally displeased with the budget they passed and I nearly certain that they would have waited around and tried to swing another 4 Republican votes rather than pass what they did.
At the federal level, there's nothing pushing the politicians to balance the budget, except for people who vote on that issue. But it's a rather abstract issue and not a lot of people vote on it compared to, say, abortion. No voting pressure, no lobbying dollars, and no legal repercussions means the problem won't get addressed. Buffet is suggesting changing the last of those three, although any of them would be enough.
Definitely. He keeps going back to the point that the debt was at 120% and nothing terrible happened, but now we have these politicians threatening to figuratively play Russian Roulette with our debt rating just to get the results they want.
The point is they shouldn't be threatening us - we should be threatening them for not getting it done.
