« | »

Obama Has Decided That There Is No Debt Crisis

From an almost questioning ABC News:

President Obama: There Is No Debt Crisis

By Jonathan Karl | March 13, 2013

There has been no shortage of dire warnings about the mounting US national debt, but President Obama is now offering a different assessment: no big deal.

"We don’t have an immediate crisis in terms of debt," President Obama said in an exclusive interview with George Stephanopoulos for "Good Morning America." "In fact, for the next 10 years, it’s gonna be in a sustainable place."

What could be more sustainable than borrowing 47 cents on every dollar the government spends?

Moreover, lest we forget, back in 2010, when Obama was trying to prevent the extension of the Bush tax cuts, he and his minions were telling us on a daily basis that our national debt was the biggest threat facing the country.

For instance, in September 2010, Hillary Clinton claimed that our debt was a national security threat. In June 2010, Admiral Mike Mullen, then Chairman of the Joint Chiefs of Staff, said it was the top national security threat. (For the record, in 2010, the annual deficit was only $1.4 trillion a year. It is now $1.6 trillion.)

And in 2008, candidate Obama even called increasing the debt by $1 trillion dollars a year "irresponsible" and "unpatriotic."

It’s an assessment that will throw cold water on the latest attempt to achieve a so-called grand bargain to reduce the deficit. After all, a grand bargain would require excruciatingly difficult decisions for both sides – for Republicans, it would mean raising taxes, and for Democrats, cutting future spending on cherished programs like Social Security and Medicare. If there is no crisis, why would either side do it?

So, what happens if this latest effort to reach a deficit agreement falls through? Once again, the president’s answer was, essentially, no big deal.

"Ultimately, it may be that the differences are just too wide" to get a deal, President Obama said. "That won’t create a crisis. It just means that we will have missed an opportunity."

You see? Obama gets to decide what is a crisis and what isn’t a crisis. ‘The Lord giveth, and the Lord taketh away.’

And never mind that the credit rating firms, such as Moody’s and Standard & Poor, announced last summer that they will lower our credit rating if we don’t do something about our debt.

Which is why we had the push for a grand bargain, and when that failed, and sequester. If our rating is lowered, we won’t be able to borrow the money needed to keep the whole charade going.

The president’s reasoning is that the series of 11th hour agreements he has struck with Republicans over the last two years – to prevent a government shutdown, raise the debt ceiling and avoid the fiscal cliff – have resulted in enough deficit reduction to get the debt under control.

"I think what’s important to recognize is that we’ve already cut $2.5- $2.7 trillion out of the deficit," he told Stephanopoulos. "If the sequester stays in, you’ve got over $3.5 trillion of deficit reduction already."

By that accounting, we have already achieved nearly all the $4 trillion the Bowles-Simpson debt commission called for back in 2010 – mission (almost) accomplished.

If $2.7 trillion dollars has already been cut out of government spending, don’t you think someone would have noticed? After all, the sequester is only going to cut $2.4 trillion, and we’re being told it is the end of the world.

But, of course, none of this is true. In fact, it is such an obvious lie that even ABC News questions the administration’s claims.

But there are two problems with that accounting:

First, the Congressional Budget Office projects a deficit of $845 billion – that’s lower than the $1 trillion-plus deficits we’ve seen over the past four years and, as a percentage of the total economy, half the annual deficit of 2009. But, CBO also warns that the deficit is projected to continue rising once again after 2015, adding a total of $7 trillion to the national debt over the next 10 years.

Second, Erskine Bowles and Alan Simpson are now saying we are nowhere near accomplishing the amount of deficit reduction needed to put the government on sustainable path.

"They haven’t done any of the tough stuff, any of the important stuff," Bowles told me last month. "They haven’t reformed the tax code…they haven’t done anything to slow the rate of health care, to the rate of growth of the economy, they haven’t made Social Security sustainably solvent. There’s about $2.4 trillion more of hard work we’ve gotta do."

Allan [sic] Simpson went further, calling the failure to control entitlement spending "madness." …

Urgent or not, the president seemed downright pessimistic about bridging the difference between Democrats and Republicans on how to further reduce the deficit.

"I am prepared to do some tough stuff. Neither side’s gonna get 100 percent. That’s what the American people are lookin’ for. That’s what’s gonna be good for jobs. That’s what’s gonna be good for growth," President Obama said. "But ultimately, it may be that the differences are just too wide. It may be that ideologically, if their position is, ‘We can’t do any revenue,’ or, ‘We can only do revenue if we gut Medicare or gut Social Security or gut Medicaid’ – if that’s the position, then we’re probably not gonna be able to get a deal."

We have already ‘done revenue.’ $600 billion dollars worth. Not to mention the ‘revenue’ hidden in Obama-Care and a dozen other stealth tax increases.

But why worry about it? The crisis is over. It’s now ‘on to the next crisis.’

This article was posted by Steve on Thursday, March 14th, 2013. Comments are currently closed.

No Responses to “Obama Has Decided That There Is No Debt Crisis”

Sorry, comments for this entry are closed at this time.

« Front Page | To Top
« | »