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Scott Walker: Dunce by ann-s-thesia, on Flickr
So, here we are, already at our borrowing limit and living on borrowed time as the Federal Reserve shuffles money around, to temporarily keep us from defaulting on our obligations. The Republicans still think that this is a good thing to play politics with. While I have some belief (e.g. faith without any proof) that they will not take us over that cliff because Wall St and the people that fund them understand how bad it would be, I am still a little worried,.
One thing I am worried about is that the Dems might cave on this. That would be really bad as it would just encourage hostage taking like this in the future; as well as the fact that whatever cuts the Republicans demand would hurt the economy as a whole and lots and lots of real people in the very short term.
Still we see it being played out. Talking Points Memo has a story tonight where Rep. Paul “I want to kill Medicaid” Ryan is saying, against evidence of many business groups saying the opposite that “The Wall St I know is totally okay debt default fore a few days” Here lets let the Medicaid Massacre Maestro tell you in his own words, from the TMP article:
Ryan told the network that he talks to “lots of bond traders” and “lots of economists” and they all say that investors are willing to put up with a default of “a day or two or three or four” if it produced massive budget changes as part of a Capitol Hill debt limit deal.
“They all say, ‘whatever you do, make sure you get real spending cuts,’” Ryan said. “Because you want to make sure that the bond-holder has the confidence that the government’s going to be able to pay them. You’re putting the government in a better position to pay them.”
What the Rep of Very Little Brain seems to fail to understand is that an actual default, or even showing signs that we would actually do something like that could ruin the credit of the United States for a very long time. Worst case scenario, after the collapse of the world credit markets, the world decides that A) it is not going to use dollars as the default currency anymore and B) that never again will US Treasury bonds be a stone cold safe investment.
I do love how he does not quote anyone specifically. He says “lots of economists” agree with him. I’d be happier if he named just one who was willing to stand up and say what he is saying. It still would be a minority voice in the great preponderance of opinion but it would at least be someone.
Which brings me to a question that I’ve been mulling around. One of the reasons that the Tea Party Republicans are so willing to let this happen is not that they don’t think we’ll default, but that they don’t believe the what the experts are telling them about the consequences of that default.
This is the kind of the logical end to the Rights war on expertise. They have so degraded the value of specific study in an area that now, when it is important to understand a fact that is counter to the way they wish the world to be, they are completely unwilling to accept expertise.
We’ve seen this with other issues, climate change being the biggie, but it is the issue of economics and world credit markets that has them completely baffled. Unfortunately the inability to process new information from outside their ideology has become so strong that there is a real possibility that the Tea Party Republicans will play chicken with our national credit. It would be bad enough if it were just our nation, but the US Treasury bond is the backbone the world’s credit and monetary body. These morons think they are playing operation, while what they are really doing is playing for keeps.
What is on your minds tonight Firedogs? The floor is yours!
26 Comments
In a word, no. The Republicans’ corporate masters don’t want America to default on its debt. This is theater, and Obama is playing along so he can back more cuts to what remains of the New Deal and the Great Society in the name of bipartisanship and fiscal responsibility, and then claim to his base that he had no choice because of the Big Bad Republicans. The Tea Party is just a foil.
Bin Quick nailed it on his post. This IS like Boehner holding a gun to his head and threatening to kill himself if Obama doesn’t cave. And Obama WANTS to cave. Because he is every bit as much of a Fascist as Boehner is.
You know, I kind of hope that the Republicans really HAVE gone completely insane and will force a default. Then this whole stinking system will come crashing down in short order. I have very little to lose if it does. But the oligarchy has a LOT to lose if it does, maybe even their lives. They won’t allow it to happen.
Addendum: But the oligarchy WILL allow the theater to go on for awhile to see just how much more they can extract from the rest of us. And the M$M will play along, too.
At times like these, I’m glad I could no longer afford cable.
Sorry I have zero patients with nihilism. There is a hell of a lot for all of us to lose. You think this nation will even maintain the level of democracy that we have if there is a massive economic collapse?
The last time there was a world wide depression it gave real fascism the space it needed to grow. What makes you think this will be any different? Don’t ever wish for the worst, because you will not like it if if you get it.
It’s not about the Republicans and the Wall Street Centrist Democrats. It’s all about the Rich Party Vs. the Poor Party. Nothing will change until the majority of American realize that and then start doing something about it and stop talking about “right” and “left” or “Democrat” and “Republican.” John Kerry has a lot more in common with Representative Sensenbrenner than he does with the majority of Americans and his votes show it.
Wall Street banks caused the economic crisis that has left millions unemployed, foreclosed.
Tax breaks for the rich for the past 30 years have created massive tax revenue shortfalls To deal with these budget woes, politicians are cutting public spending: laying off teachers, attacking public sector workers, raiding pensions, closing hospitals, and eliminating essential services for children, veterans, and the elderly. That’s their solution–anything but their tax breaks.
READ THE FOLLOWING REPORT AND PASS IT FORWARD:
This report analyzes data from the latest financial filings by the six big banks – Bank of America, Wells Fargo, JPMorgan Chase, Citigroup, Goldman Sachs, and Morgan Stanley – to expose the ways in which they continue to avoid taxes and contribute to tax revenue shortfalls, rather than pay for an economic recovery that will put people to work, keep people in their homes, and preserve the safety net – for people, not corporations.
Six banks – Bank of America, Wells Fargo, Citigroup, JPMorgan Chase, Goldman Sachs, and Morgan Stanley together paid income tax at an approximate rate of 11% of their pre-tax US earnings in 2009 and 2010. Had they paid at 35%, what they are legally mandated to pay, the federal government would have received an additional $13 billion in tax revenue. This would cover more than two years of salaries for the 132,000 teacher jobs lost since the economic crisis began in 2008.
http://showdowninamerica.org/files/big-bank-tax-drain.pdf
Bill, there will BE no collapse, at least not from the kabuki going on now.
Ohio Gringo nails it, it’s not nihilism hoss, it’s reality.
This is a simple matter, a tactic we’ve witnessed since FISA, TARP, AHCA, etc, The right wing goes batshit crazy the dems huff n puff, the moderate rethugs (both of them /s) pull things back a tad from the crazy and the dems dive in with both feet.
The debt ceiling limit, all the kabuki going on, is to attack medicare and social security.
That you just won’t seem to equate this pseudo game of chicken about debt ceiling being played out right now with the direct attacks on entitlements, social security and medicare completely baffles me.
Do you not believe this is kabuki being used to scare and manipulate politicians, press and we the people so the elite can take away the safety net from we the people?
Cuz that’s all it is. It’s simple, and you just won’t buy into it?
I’m flabbergasted if that’s the case.
I’m not a nihilist, Bill. Perhaps I was not clear when I said “I KIND OF hope…that the Republicans will force a default…”
I was speaking of emotions, not political positions. For the record, I am not in favor of refusing to raise the debt limit. That would be foolish, probably disastrously foolish for us all.
Still, you show your true class colors yet again.
As usual, a latte’ liberal, that means you, Bill, has taken one segment of what I said a little bit out of context and fired his little pop-guns at me. As far as “real fascism” goes, we’ve got it right now, by my definition, which I stole from Mussolini. As far as wishing for the worst, I don’t, but I’m only a month or two away from it if I lose my job. You are clearly not.
As far as democracy goes, America is not a democracy now. It is a pretend-theater democracy controlled by an oligarchy.
From where I live, I would be better off under a Caesar or a Napoleon or a Cromwell. And I was raised in an upper middle class family. I played by the rules and got screwed. I really do have very little to lose.
Democracy? What is democracy without food in my children’s bellies and a roof over their heads? A meaningless, insignificant concept, that’s what.
Put down the Starbuck’s, pour a cup of black Maxwell House because cream and sugar cost too much, and wake the flock up. Please.
Thank you, Larue, for being more diplomatic than I. You put it very well and accurately. I just kind of went off on the worst-case scenario below, partly because Bill pissed me off and I felt like retaliating. A little.
Surely Bill Egnor is too intelligent not to see this kabuki theater, as you put it, for what it is. It’s as obvious as the sun setting in the West.
“living on borrowed time”
We are also living on borrowed money.
Fair enough. I did attribute a mode of thought that you were just playing with as your main one. That was incorrect and I retract it.
As I said I have zero patients for nihilism and that lack of patients made me jump too far. Sorry Ace.
According to Barkley Rosser at EconoSpeak
Treasury should just ignore the damn debt limit and just go on paying the bills.
I agree with Ohio Gringo and Larue.
The Republican’s threat to vote against raising the debt limit and the Democrats’s OMG-WTF-Are-We-Going-To-Do-Now response is yet another Kleptocrat Production directed by the Grifter-in-Chief, Barack Obama. The production is being performed at the Village Theater in Washington, DC before a fawning audience of drooling slack-jawed pundits.
We’ve seen this variation of the tired plot in which yet another financial doomsday is created to justify eliminating Social Security, Medicare, Medicaid, and the rest of the safety net. It wasn’t convincing the first time and now it’s just immensely irritating.
They are just a bunch of crooks working the biggest Ponzi scheme in the history of financial crimes in order to finish off the endangered middle class and vacuum up all of the wealth that the Kleptocrats haven’t already stolen.
They are reckless, disgusting, and despicable.
I’m tired of their non-stop bullshit.
We need a revolution and we need it NOW.
Que todos se vayan!
Perils of sharing a computer and forgetting to log out and log in with a new user.
I, Masoninblue, do solemly swear that I wrote the previous comment, not Crane-Station.
The “debt ceiling” is a figment of the imagination – created out of thin air by a previous Congress as a way to keep track of our so-called public debt. Also, there is a clause in the 14th Amendment of the Constitution which prohibits Congress (or anyone else for that matter) from doing anything which would damage or destroy the ‘full faith and credit of the United States Government’. I completely agree that the Treasury Secretary should just continue to pay the bills – he has the Constitutional Authority to do so.
The “debt ceiling” could be raised or not – or it could just as easily be completely removed. It serves no useful purpose except as a bookkeeping marker. All the threats by the Republicans about defaulting are out of line and they should be called on it. The Republicans are so big on the Constitution and all these threats and bullying on this issue are already “damaging” the full faith and credit. They need to either pass the new ceiling or just get rid of it altogether because it really is meaningless.
Particularly since even their draconian Ryan budget actually increases the debt over the next 10 years they statutorily cannot argue for not raising the debt ceiling to accomodate their own budget, and as any economist of any school you like including Ayn Rand knows, you must raise it beyond your best projections because stuff always happens to make things come out worse than you planned.
Enough already.
Then if I understand what you are saying – or the constitution amendment you cite – then the Debt Ceiling itself may be unconstitutional and could be challenged in court.
Bill — you may have zero patients for nihilism or a lack of patients may be making you jump too far but if you had zero patience for OhioGringo’s comment above and retract it now then hopefully you will chose to be more patient next time regarding OhioGringo’s views.
I agree with the view(s)OhioGringo expressed above.
It would be more useful if sites such as FDL or Salon devoted more time/effort pressuring Barack Obama and the D Party he is the front man for to change ways and get the politics they do fixed. Daily Kos? Is overun with ObamaBots and Obamapologists.Jeepers-Creepers.
Dredging up or orbiting around what is wrong or who is wrong with/in the R Party? Ain’t doing us voters no good.
I don’t care what the R Party is doing or not doing or who is doing what or not doing what in the R Party.
Those are R Party’s problems and they deserve all of it.
My problem(s) are with the D Party and the current D Party WH POTUS Barack Obama who did not walk his talk or does not walk his talk. Or with the D’s in WashingtonDC who think Ronny Raygun is Swell and FDR was from Hell.
Who cares what Mike Huckabee,Newt Gingrich or Mitt Romney think,do or say? Who cares what G.W.Bush or Dick Cheney have to say about jack or shit? Why should I care about what Sarah Palin said or what Mitt Romney did not say? I would never vote for any of them no matter what anyway.
Right now however Barack Obama is looking for enough voters to win the WH again and if he is going to play Flim Flam/Easy Pleasy political games again to win the WH in November 2012 now is the time to apply the pain and get some gain from this D Party POTUS Charades player.
It ain’t about the R’s folks — forget them — they have gone to Crazy Town and like it.
It is about getting the D Party to shape up or voting them out until the D’s start to shape up. If they will not or refuse to shape up? Then vote them out in favor of the Greens or create the FDR Liberal Party.
Now is the time to pressure Barack Obama to do what he ain’t been doing and if he ain’t gonna do that then let him know he is going to get voted out.
Either fix the D Party or replace it.
The R Party? Who the hell cares? With Sarah,Newt,Mitt and the likes of Eric Cantor,TanMan Boehner and Paul Ryan the R’s are racing towards political oblivion plenty fine on their own dime and time. Let’em win that race.
Bill, I don’t ordinarily do this but.
Patience.
Unless I missed a snark tag somewhere the word is patience.
Yer an editor.
Larue – Thanks! f’ing dyslexia! I know how to spell both words, but I can’t see the difference so it is not like spell check helps at all.
“the world decides that A) it is not going to use dollars as the default currency anymore and B) that never again will US Treasury bonds be a stone cold safe investment”
That is the reality of the situation. Why should countries continue to hurt themselves by believing the lie?
In case you’re wondering, no i don’t support Ryan or Obama or the other criminals. I think the best approach is freedom, liberty, and the non-aggression principle.
I have a question: If the debt ceiling is NOT raised can most of the bills still be paid by ending the wars in that case without cutting aid to the poor or medicare of the US?
the world decides that A) it is not going to use dollars as the default currency anymore
Astounding! A bunch of ignorant rubes will do what Osama Bin Laden might have cherished for his legacy, had he lived to bring it about.
As commander in chief, prez can lay people off…
No one thought they would be stupid enough to shut down the government over Newt’s pique at his plane seat assignment during the Clinton administration.
I think they ARE stupid enough to be capable of doing it. I also think if they did it, that the consequences would be felt in about 10secs as stock futures would start dropping like a stone. They, just like the rest of America, could watch their paper wealth implodes in seconds. Actually, there are supposed to be electronic safeguards in place that shut down the market – I only hope they kick in – who knows?
I also think that if they continue to play brinksmanship, they could cause a run on the banks as people rush to withdraw cash to have on hand in case of meltdown. Then think massive inflation of cash. Then think – oh never mind. Best to stop thinking at that point. If you start to see Republicans in the canned food aisles – start to worry.
Tea baggers may bring lawsuits,
no standing, In fact, once Bernanke decides to buy the overlimit treasuries, it’s game over for the hostage takers. There’s no forum other than impeachment as a sanction for Prez not firing Geithner, ie, taking care that the law (debt limit) is enforced…lotsa luck with that.
That wasn’t my question.
I accept your gracious apology. It takes courage to do that in public like that, and I respect you for it. I’ve also learned over the decades not to hold grudges. All they do is soak up one’s own energy and turn one into a bitter, vindictive person.
I have as little patience for nihilists as I do for anarchists, extreme libertarians, Stalinists, Pol Pot apologists, Nazis, or committed Fascists. I say committed because many people support fascist positions due to the propaganda they have been fed all of their lives. Call me an optimist, but I think there is hope for many of them.
Unfortunately, it will probably take a swift kick to the wallet to wake them up. That kick is coming, and will kick ME as well. And that pisses me off.
Crane-Station here, I was out of the house when Mason wrote this. I actually do not consider myself qualified to discuss economics or politics much but I am learning!