The Irresponsibility of the Republicans in Washington

The eurozone countries waited until they were on the edge of the abyss before deciding to bail out Greece for the second time last week. As if the prospect of a serious crisis were the only way to get them to abandon their casual wait-and-see policy. But they have an excuse: They had to make a decision among seventeen of them — what a performance!

The United States has no such excuse. The country’s public debt is the federal government’s responsibility. Even though the Founding Fathers of the American republic intended to establish a clever balancing act between the president and Congress, they and they alone are responsible for making decisions in this matter.

They are not making any decisions. They are paralyzed. They too are waiting to be on the edge of the abyss. In less than a week, if Democrat Barack Obama and the Republican majority in the House of Representatives do not come to an agreement, the U.S. Treasury will be in default of payment, which will cause economic and financial catastrophe, just like an implosion of the eurozone would have done.

It is as if the American system of government is no longer working or working less and less effectively, particularly in relation to this central issue: how to get out of debt.

The problem is well-known. In the United States, there is a legal ceiling on public debt (total of all deficits accumulated over the years); if it is reached, approval from Congress is needed to raise it. Failing which, the United States can no longer borrow. Yet, this is how they fund over 40 percent of their expenses — by issuing Treasury bills.

The Republicans want the increase in debt to be contingent on a prior vote on reducing the budget deficit in the next finance laws. This is where the president and Congress have been disagreeing for weeks.

The debt ceiling hit its limit of $14.3 trillion dollars in May. The Treasury Department has warned that the government will no longer be able to meet all its obligations on Aug. 2. It will no longer have enough resources; it will be technically bankrupt.

Each day that passes, the Washington psychodrama is making the markets a little more feverish and resulting in a difficult economic climate. The Republicans are responsible for this deadlock. Although they are the party that eroded public finances in recent years, they rejected a courageous compromise proposed by Obama to substantially reduce the deficit by cutting public spending and by increasing taxes on the wealthiest segment of the population.

It was a centrist proposal. But the problem is that the second major American party has become an extremist organization. The Republicans are refusing any tax increases due to ideological fanaticism.

This will force Obama into making a minimal and temporary agreement on the debt. Default on payment will surely be avoided. But the irresponsibility of the Republicans is striking a blow to America’s image.