GOP Extortionists Admit Not Raising Debt Ceiling Means "Financial Collapse and Calamity"
With the fiscal cliff averted, Congressional Republicans are turning to their next--and more important--hostage. Without draconian spending cuts, they promise, the GOP will block any increase in the debt ceiling of the United States. In response, President Obama said, "I will not have another debate with this Congress over whether or not they should pay the bills that they've already racked up through the laws that they passed" and warned:
"If Congress refuses to give the United States government the ability to pay these bills on time, the consequences for the entire global economy would be catastrophic -- far worse than the impact of a fiscal cliff."
As it turns out, Republicans leaders couldn't agree more.
Take, for example, South Carolina Senator Lindsey Graham. For the second time in less than a month, Graham said the President of the United States should "man up" on spending cuts--or else. In January 2011, he explained what that "or else" was:
"Let me tell you what's involved if we don't lift the debt ceiling: financial collapse and calamity throughout the world. That's not lost upon me. But we've done this 93 times. And if we keep doing the same old thing, then that is insanity to the nth degree."
Congressman Paul Ryan, the Republican Party's 2012 vice presidential candidate and architect of the House GOP budget, couldn't agree more. A year ago, Ryan told Paul Gigot, "Obviously, you can't default" and admitted:
"Does it have to be raised? Yes, you can't not raise the debt ceiling. Default is the unworkable solution, or the alternative, I guess I'd say -- the unworkable alternative."
Ryan should know what he's talking about. After all, his budget blueprint, the one delivering another massive tax cut windfall for the wealthy and supported by 98 percent of Congressional Republicans, would add $6 trillion in new debt over the next decade and require repeated increases to Uncle Sam's borrowing authority.
In his more sober moments, House Speaker John Boehner has acknowledged as much. In April 2011, he told a gathering of unhappy Ohio Tea Partiers that Republicans would absolutely have to raise the nation's debt limit:
"And we're going to have to raise it again in the future," he added. With the mass retirement of America's Baby Boomers, he explained, it would take 20 years to balance the U.S. budget and 30 years after that to erase the nation's huge fiscal deficit.
In May 2012, Boehner agreed that the Paul Ryan budget almost all Republicans backed would violate "my simple principle of cuts and reforms greater than the debt limit increase":
"Yeah, the big bad House Republican budget that would just gut everything under the sun, according to my friends across the aisle, would still require a $5 trillion increase in the debt ceiling over the next 10 years. Why? Because of the great big demographic bubble -- baby boomers like me, that are going to retire and continue to retire for the next 20-25 years. It's a big challenge."
A big challenge, apparently, only for President Obama and the Democrats. Nevertheless, Speaker Boehner, too, is willing to undermine the full faith and credit of the United States of America in order to extort the Republicans' ransom. And if the President refuses to pay to free the American economy being held hostage by the GOP?
"That would be a financial disaster, not only for our country but for the worldwide economy. Remember, the American people on Election Day said, 'we want to cut spending and we want to create jobs.' And you can't create jobs if you default on the federal debt."
The sainted Ronald Reagan, who signed 17 debt limit hikes and presided over a tripling of the national debt, warned any would-be hostage-takers:
"The full consequences of a default -- or even the serious prospect of default -- by the United States are impossible to predict and awesome to contemplate. Denigration of the full faith and credit of the United States would have substantial effects on the domestic financial markets and the value of the dollar."
On that point, Reagan was right then and he's right now. During the GOP's first debt ceiling hostage taking in the summer of 2011, U.S. consumer confidence plunged and hundreds of thousands of jobs lost. As for the uncertainty and credit rating downgrade the debt ceiling debacle produced, S&P pointed the finger at the GOP, the only party willing to countenance a default by the United States:
A Standard & Poor's director said for the first time Thursday that one reason the United States lost its triple-A credit rating was that several lawmakers expressed skepticism about the serious consequences of a credit default -- a position put forth by some Republicans. Without specifically mentioning Republicans, S&P senior director Joydeep Mukherji said the stability and effectiveness of American political institutions were undermined by the fact that "people in the political arena were even talking about a potential default," Mukherji said. "That a country even has such voices, albeit a minority, is something notable," he added. "This kind of rhetoric is not common amongst AAA sovereigns."
That kind of rhetoric may not be common amongst AAA sovereigns, but it's all in a day's work for Senate Minority Leader Mitch McConnell (R-KY). As he put it after last summer's debt limit deal:
"I think some of our members may have thought the default issue was a hostage you might take a chance at shooting," he said. "Most of us didn't think that. What we did learn is this -- it's a hostage that's worth ransoming. And it focuses the Congress on something that must be done."
Former Bush Treasury Secretary Paul O'Neill has a term for those of his Republican colleagues willing to shoot the hostage, that is, the U.S. economy. As he worried in April 2011:
"The people who are threatening not to pass the debt ceiling are our version of al Qaeda terrorists. Really. They're really putting our whole society at risk by threatening to round up 50 percent of the members of the Congress, who are loony, who would put our credit at risk."
(For more background on how today's kamikaze conservatives unleashed the oceans of red ink they now decry, see "The National Debt? Republicans Built That.")