« | »

Politico Calls Republicans ‘Default Deniers’

From the shameless O-Bots at the Politico:

Default deniers: The new skeptics

By: Carrie Budoff Brown
May 17, 2011

They are the newest breed of government skeptics, the swelling ranks of Republicans who don’t believe the Obama administration when it says a failure to raise the debt limit will prove catastrophic.

And they stand ready to make negotiations over raising the cap on debt as grueling as possible, leaving Treasury officials and Wall Street more nervous than ever that the country could suffer an unprecedented default, with consequences no one can predict.

The suspicion, which once flourished only on the conservative outskirts of economic circles, has seeped into the mainstream in recent weeks, gaining broader acceptance among establishment Republicans even as the administration issues increasingly dire warnings.

The reporter is comparing Republicans who question the need to raise the debt ceiling with ‘Holocaust deniers.’ Which is pretty reprehensible, even by the Politico’s low standards.

House Speaker John Boehner (R-Ohio) validated the default deniers Sunday, saying, “I understand the doubts.” Jim Nussle, a budget director under former President George W. Bush, argued last week that “no one’s going to default” if Congress misses the Aug. 2 deadline. And Alabama Sen. Jeff Sessions, the top Republican on the Senate Budget Committee, accused the White House of scare tactics similar to those used by the previous administration to win quick approval of the 2008 bank bailout after the markets crashed.

“Congress was stampeded,” Sessions said of the bailout vote. “They will have a harder time stampeding the Congress.”

Gosh, what evil men. By the way, whatever happened to the evils of fearmongering? Or is fearmongering always acceptable when it is done in the service of advancing the Democrat agenda?

The growing divide is fed by a combustible mix: deep distrust among conservatives of President Barack Obama and government in general and a hardening view among mainstream Republicans that the debt-limit vote offers the best shot in years to fundamentally reorder the country’s finances — and they can’t let it pass them by…

The doubters reject Geithner’s repeated claims — backed by Wall Street — that failing to raise the statutory cap would force the federal government into the first default in its history.

That’s hogwash, the doubters say, because the government takes in more than enough revenue to cover its obligations. They acknowledge the administration would need to make deep and painful spending cuts but argue that Geithner can avert default if he prioritizes which bills to pay

Geithner’s response? It’s default by another name.

It’s nothing of the sort. It’s not even close. But what do you expect from someone who can’t even figure out Turbo Tax.

Even if Treasury pays its debt, other obligations such as salaries, tax refunds and contractor payments would go unmet, tattering the country’s creditworthiness, Geithner has argued.

In a letter Friday to Sen. Michael Bennet (D-Colo.), Geithner wrote that such an event that “would inflict catastrophic, far-reaching damage to our Nation’s economy, significantly reducing growth and increasing unemployment.” The value of 401(k) plans and pension funds would plummet, while the cost of buying a home or car and taking out student or business loans would rise, Geithner wrote.

“This abrupt contraction would likely push us into a double-dip recession,” the secretary warned

More hogwash.

This article was posted by Steve on Tuesday, May 17th, 2011. Comments are currently closed.

7 Responses to “Politico Calls Republicans ‘Default Deniers’”

  1. Petronius says:

    In the event that the US government does default, its credit rating will be cut and bond investors, both foreign and domestic, will run to the exits.

    They will dump US Treasuries and the government will not be able to place any new debt until interest rates rise sharply to compensate investors for their added risk.

    And that would not only be a shock to the bond market (which, by the way, is much bigger than the stock market), but it would also be disastrous for the economy and the stock market. It would in fact be a debt crisis.

    There are immediate ways to avoid this: lift the debt ceiling, cut spending, or some combination of both.

    If the Republicans play “chicken” with this issue and are seen to be the party who precipitated the debt crisis –– and that is the way the MBM will spin it –– they will be finished as a political party.

    It is curious that interest rates actually fell this month and bonds rose. This happened despite the fight over the debt ceiling, the weak dollar, massive spending, QE, and inflation. Thus this action is contrary to the fundamentals and to long-term trends. Perhaps the Fed has been buying so many government bonds that it’s boosting the bond market? Or perhaps we’re seeing a short-term reversal in the long-term bear market trend?

  2. Right of the People says:

    If this were a family or even a small business faced with the same problem, more debt than income, most rational people would begin to look where they could cut to save money and possibly get out of the mess. Stop buying coffee at Starbucks and other ridiculously priced places, eat out less, buy cheaper cuts of meat, and on and on, trade that Ferrari for a Ford Focus. You know, rational things.

    However the government, particularly the Dimocraps, are not acting like rational people. Instead of cutting they just want to increase how much we are in hock sort of like getting yet another credit card you can’t afford but someone is stupid enough to let you have then keep charging on it until it’s maxed out.

    Raising the debt ceiling without responsible, realistic cuts to worthless programs like HUD, HHS, and dozens of other worthless agencies is irresponsible to the extreme.

  3. tranquil.night says:

    Tick-tock John.

    The public needs a proposal they can evaluate.

    Longer you stall, the more Spike and the MBM blame you for Geithner’s harmful and unnecessary measures.

  4. untrainable says:

    “This abrupt contraction would likely push us into a double-dip recession,” the secretary warned…
    I’ll ask again. When did we get out of the first dip? By what metric are we measuring the economy? Housing… still down. Unemployment… still up. If we ever got out of the first dip, it wasn’t very long lived because I missed it.

    Ask the extra 14 or 15 million people pushed onto the food stamp roll. Ask the unemployed who haven’t been able to find a job for 2 years. Ask the graduating kiddies who are moving back in with their parents after college how great the recovery has been. Ask their parents? Hell… ask me, I’ll tell ya. By any real measurement the economy continues to be bad, and will continue to be bad until something is done about the socialist policies currently being adopted by the boy king and his regime. Come on 2012.

  5. eaglewingz08 says:

    Waiting for all the Jewish democrats who excoriated Gov. Palin for using (correctly) the term “blood libel”, to jump down the throat of Politico for demeaning the holocaust. Yeah, right.
    Crickets still chirping.

  6. Not so fast says:

    It really doesn’t matter much does it? The United States is going to DEFAULT ultimately no matter what. The Big money boys have already banked on it so……………………….

  7. Phil Byler says:

    Politico is trying to create a hysteria about not raising the debt ceiling and the related prospect of a default by the U.S, Government. That hysteria is intended to create a false sense of responsibility about raising the debt ceiling, so as to dissuade Republicans from pushing too hard cuts in U.S. Government spending in return for raising the debt ceiling. But what would be truly irresponsible would be the raising of the debt ceiling so as to permit the continuation of multi-trillion dollar deficit spending by the U.S. Government. Republicans need to stand strong and allow a default if need be in order to get Democrat agreement to massive cuts in U.S. Government spending.


« Front Page | To Top
« | »