How Do we Once Again Crack Uncle Sam’s Ceiling on Debt?
Published in Le Figaro
(France) on 6 January 2011
by Pierre-Yves Dugua (link to original)
(France) on 6 January 2011
by Pierre-Yves Dugua (link to original)
Translated from
by Rachel Towers.
Edited by Piotr Bielinski.
Something incomprehensible is happening in Washington: The Republicans who largely crushed the Democrats in the November 2nd elections are revealing their incredible intentions. They actually want to keep their promises!
Let me look at this from France’s perspective. Newly elected representatives from the right who, just after their arrival, aren’t even thinking about allying themselves with leftist ideas. It’s incredibly shocking. After having campaigned on the theme of reducing public spending, the Republicans, especially the ones from the tea party, want to reduce public spending. Let’s go!
Two months ago the intellectual elite explained to us that these new tea party members were dangerous and misinformed hysterics. Today it’s the intellectuals who are on the cusp of a hysterical fit: these misinformed hysterics want to profit from the fact that they’ve been elected by the people (in bad faith) to cut sacrosanct spending such as…financial support to states in the matter of public transport, for example.
What’s worse, these insanely patriotic citizens have gotten caught up in the idea of demanding reduced spending, or else they will vote against increasing the public debt ceiling. According to the American Treasury, in eight weeks we’re going to have to vote for this increase. Otherwise, Uncle Sam won’t be able to pay his invoices, especially debt interest, or send monthly retirement pension checks to millions of Americans…
How can anyone dare take America hostage and use the threat of letting it fall into debt?
1) Misinformed ? Yes.
A lot of elected tea party members are very poorly informed. The thought that cutting development aid and eliminating waste is going to reduce America’s calamitous debt is naïve. To reduce the deficit in a durable and credible manner we have to reform social programs (Medicare for health and Social Security for retirement). We have to also reduce military spending. We need to get rid of tax relief and raise certain taxes. Will the conservatives have enough courage to do so?
2) Dangerous ? They’re not the only ones.
It’s been 30 years that Congress and the White House have been making up good reasons to keep increasing the debt ceiling. This addiction needs to stop. Why not take advantage of the occasion of a foreseeable vote eight weeks from now, to motivate Congress to finally do its job: [A choice must be made] between necessary spending and expenses which Uncle Sam should pass on because he’s already over-indebted.
Tim Geithner, the Secretary of the Treasury, is right to say that it would be irresponsible to let America go into default by the end of March. The consequences on the financial markets would be catastrophic.
But can we still act as though nothing happened? Can we once again postpone until later a vote on the real economy? Will we have to wait until the dollar collapses and the rates demanded by investors skyrocket, for Washington to behave in a fiscally responsible manner? It would be similarly dangerous to act as usual and let the debt ceiling continue to climb without any conditions.
In 1995, Republicans, judged by the elite to be as disreputable as the tea party of today, had already taken a shot at it. They paralyzed the federal government for several days in November, then again at the end of December. The default on the payment was avoided, but by a hair’s breadth. President Clinton was obliged to suspend almost all federal public functions because he refused budgetary cuts demanded by zealous Republicans.
Eventually, Clinton won, helped by the anti-Republican press at the time, who presented Gingrich as a crazy person bent on ruining America just to satisfy his ideology. The Republicans looked like a bunch of weaklings.
What would happen today?
Today there’s Fox News and conservative hosts who dominate the radio. There’s also the tea party, its blogs and the internet. And there is, above all, enormous anger and anguish on the part of a conservative America in regards to the explosion of the debt, as well as the unconvincing promises of Barack Obama to rectify the problem.
There’s currently a debt ceiling of $14,300 billion …higher in ratio to the GDP than in 1995 and a real fear among the markets concerning the risk of America losing its AAA rating.
On the other hand, Barack Obama remains a president who is appreciated personally. The Republicans, even their legitimate leaders, thanks to their sparkling victory in November, are not well-liked by the media and are portrayed none too sympathetically, except in the eyes of an important fringe of angry Americans.
To avoid playing with the debt ceiling, to avoid even giving credit to the option of an America defaulting [on its debt], it’s urgent that Barack Obama placates the fear of sincere Americans who don’t understand why their elected officials have been organizing the hold-up of their children for a generation.
How can we get rid of this fear? I suggest for one thing that the president abandon his pro-union and anti-business rhetoric; he could also announce at the end of February a budget project that offers credible expense reduction; it would also do him well to remind his fellow citizens that the American economy is doing better, and that all of this will end by improving employment.
Let me look at this from France’s perspective. Newly elected representatives from the right who, just after their arrival, aren’t even thinking about allying themselves with leftist ideas. It’s incredibly shocking. After having campaigned on the theme of reducing public spending, the Republicans, especially the ones from the tea party, want to reduce public spending. Let’s go!
Two months ago the intellectual elite explained to us that these new tea party members were dangerous and misinformed hysterics. Today it’s the intellectuals who are on the cusp of a hysterical fit: these misinformed hysterics want to profit from the fact that they’ve been elected by the people (in bad faith) to cut sacrosanct spending such as…financial support to states in the matter of public transport, for example.
What’s worse, these insanely patriotic citizens have gotten caught up in the idea of demanding reduced spending, or else they will vote against increasing the public debt ceiling. According to the American Treasury, in eight weeks we’re going to have to vote for this increase. Otherwise, Uncle Sam won’t be able to pay his invoices, especially debt interest, or send monthly retirement pension checks to millions of Americans…
How can anyone dare take America hostage and use the threat of letting it fall into debt?
1) Misinformed ? Yes.
A lot of elected tea party members are very poorly informed. The thought that cutting development aid and eliminating waste is going to reduce America’s calamitous debt is naïve. To reduce the deficit in a durable and credible manner we have to reform social programs (Medicare for health and Social Security for retirement). We have to also reduce military spending. We need to get rid of tax relief and raise certain taxes. Will the conservatives have enough courage to do so?
2) Dangerous ? They’re not the only ones.
It’s been 30 years that Congress and the White House have been making up good reasons to keep increasing the debt ceiling. This addiction needs to stop. Why not take advantage of the occasion of a foreseeable vote eight weeks from now, to motivate Congress to finally do its job: [A choice must be made] between necessary spending and expenses which Uncle Sam should pass on because he’s already over-indebted.
Tim Geithner, the Secretary of the Treasury, is right to say that it would be irresponsible to let America go into default by the end of March. The consequences on the financial markets would be catastrophic.
But can we still act as though nothing happened? Can we once again postpone until later a vote on the real economy? Will we have to wait until the dollar collapses and the rates demanded by investors skyrocket, for Washington to behave in a fiscally responsible manner? It would be similarly dangerous to act as usual and let the debt ceiling continue to climb without any conditions.
In 1995, Republicans, judged by the elite to be as disreputable as the tea party of today, had already taken a shot at it. They paralyzed the federal government for several days in November, then again at the end of December. The default on the payment was avoided, but by a hair’s breadth. President Clinton was obliged to suspend almost all federal public functions because he refused budgetary cuts demanded by zealous Republicans.
Eventually, Clinton won, helped by the anti-Republican press at the time, who presented Gingrich as a crazy person bent on ruining America just to satisfy his ideology. The Republicans looked like a bunch of weaklings.
What would happen today?
Today there’s Fox News and conservative hosts who dominate the radio. There’s also the tea party, its blogs and the internet. And there is, above all, enormous anger and anguish on the part of a conservative America in regards to the explosion of the debt, as well as the unconvincing promises of Barack Obama to rectify the problem.
There’s currently a debt ceiling of $14,300 billion …higher in ratio to the GDP than in 1995 and a real fear among the markets concerning the risk of America losing its AAA rating.
On the other hand, Barack Obama remains a president who is appreciated personally. The Republicans, even their legitimate leaders, thanks to their sparkling victory in November, are not well-liked by the media and are portrayed none too sympathetically, except in the eyes of an important fringe of angry Americans.
To avoid playing with the debt ceiling, to avoid even giving credit to the option of an America defaulting [on its debt], it’s urgent that Barack Obama placates the fear of sincere Americans who don’t understand why their elected officials have been organizing the hold-up of their children for a generation.
How can we get rid of this fear? I suggest for one thing that the president abandon his pro-union and anti-business rhetoric; he could also announce at the end of February a budget project that offers credible expense reduction; it would also do him well to remind his fellow citizens that the American economy is doing better, and that all of this will end by improving employment.
The write seems somewhat uninformed, and succumbing to liberal propaganda that everything is the Reubs fault. Not so. Support for not raising the debt ceiling is widespread, with two-thirds of the American people supporting it. People on the left as well as those on the right.
It’s a myth that putting the US on a sound financial footing would be catastrophic. Just propaganda from the banksters. On the contrary, it would be very good for the global economy, which after a period of chaos would boom.