Democratic and Republican politicians seem hell-bent on overturning an uneasy peace ReutersHouse Speaker John BoehnerJust when it seemed that worries about debt and deficits were fading, the geniuses in Washington, D.C., are chomping at the bit to undo the little progress we’ve made. President Obama and Congressional Republicans both have proposed budgets that would circumvent spending limits imposed after the 2011 debt-ceiling crisis. Throw in an October deadline for a fiscal 2016 budget and another proposed increase in that very same debt limit, and Chris Krueger, senior policy analyst for Guggenheim Partners in Washington, warns we could have a full-blown “fiscal fiasco” by fall — just as the 2016 presidential election heats up. “Any one of these issues is going to be complicated,” Krueger told me in a telephone interview. “You’re going to be adding all these [complications] to a situation that’s going to be very volatile.” This could mark the end of a brief fiscal hiatus during which deficits have dropped dramatically. A functioning Congress and administration would use this opportunity to address long-term fiscal problems. Instead, we could see a regression to the budgetary battles of yesteryear, creating another headwind for stocks in the months ahead. At issue is the dreaded sequester, which emerged from the 2011 fiscal crisis — and please bear with me as I briefly return to those halcyon days. That summer, the Tea Party-dominated House of Representatives refused to raise the debt limit without serious spending cuts. President Obama tried and failed to negotiate a “grand bargain” with Speaker of the House John Boehner. The U.S. lost its AAA sovereign-debt rating from Standard & Poor’s. Ultimately, Congress and the president agreed to raise the debt limit but appointed a bipartisan “super committee” to find over $1 trillion in spending cuts over the next decade. If they didn’t succeed, the Damocles sword of “sequestration” would arbitrarily chop that amount from the budget. This being Washington, the super committee couldn’t agree on anything, and the Sword of Damocles fell. Sequestration was a terrible idea, but it worked, in its own ugly way. As the economy recovered, tax receipts rose while discretionary defense and domestic spending were capped. (There were only modest cuts in mandatory spending, particularly Medicare, the real long-term fiscal problem.) The budget deficit, which hit $1.4 trillion and nearly 10% of GDP in 2009, shriveled to $483 billion, only 2.8% of GDP, in 2014. (Of course, any deficits add to the government’s total public debt, which stands at around 74% of GDP.) But Congress and the Obama administration can’t handle the good news. http://www.marketwatch.com/story/yet-another-fiscal-fiasco-i...