Default Deniers: Geithner's Debt Ceiling Deadline Is A Hoax

Business Insider ^ | 05/19/2011 | Grace Wyler

[SeekAndFind]

Forget the birthers, the latest conspiracy theorists to sweep Washington are the "default deniers," a growing group of conservatives who think the prospect of a U.S. default is a hoax.

Leading the charge is U.S. Sen. Pat Toomey (R-PA), a Tea Party-backed freshman who claims the Obama administration has greatly exaggerated the threat of the U.S. defaulting on its debt to scare Congress into raising the debt ceiling.

As the debt ceiling debate heats up, Toomey's theory has gained surprising acceptance among some Republican lawmakers. Politico reports that nearly 100 House members and 22 senators have signed Toomey's Full Faith And Credit Act, which would require the Treasury to first make debt payments.

In a speech at the American Enterprise Institute yesterday, Toomey dismissed the notion that the U.S. risks default if Congress doesn't raise the debt limit by August 2.

He argued that the government can easily cover its debt payments with the $2.2 trillion of expected tax revenues. Postponing other government obligations - like salaries, contractor bills and tax refunds - "are not the same things as failure to reach obligation on our debts," he said.

What Toomey fails to mention is that his solution would mean cutting the 2012 budget by $1.5 trillion. Dana Milbank at the Washington Post points out that even if the U.S. shut down the military and stopped paying Social Security, the budget would still be short by about $200 billion.

Even if the U.S. does default, Toomey argued, the result wouldn't be as terrible as U.S. Treasury Secretary Timothy Geithner (and many others) warn.

He points to a recent WSJ interview with hedge fund manager Stanley Druckenmiller:

[kosciusko51]

This looks like a pretty big game of “chicken” being played by both sides. I hope the RINOs don’t screw us on this, but they will.

[ChocChipCookie]

WOULD SOMEONE PLEASE CALL THIS MORON’S BLUFF??????

[muawiyah]

If it's a game of chicken Toomey already lost. He's talking about my money, and he's not putting any of his own at risk.

Now if he can figure out a way to subsidize me while he plays chicken, that's fine ~

[rockinqsranch]

I’m thinkin’ they have.

Just a thought, nothing really World shaking, but seems to me anybody using Dana Milbank as a resource should consider another occupation.

[muawiyah]

Dana is not a reliable informant.

[MulberryDraw]

even if the U.S. shut down the military and stopped paying Social Security, the budget would still be short by about $200 billion.

Why stop paying Social Security. It has lots of money in its trust fund remember?

[Brilliant]

Geithner can cause a default anytime he wants. Just don’t cut the checks. So if he says “Any default will be your fault,” then you can assume that he’s planning to default.

[jnsun]

can easily cover its debt payments with the $2.2 trillion of expected tax revenues. Postponing other government obligations - like salaries, contractor bills and tax refunds -

Toomey is certainly correct in the sense that when Geithner talks about covering "US obligations," exactly what are the "obligations" we are discussing. In other words we are discussing a question of priorities which of course NO slimeball politician or bureaucrat wants to confront. They will declare fearsome and emotional generalities to avoid confronting their own duplicity.

Let's put it this way, if we the taxpayers "loaned" Goldman-Sachs and AIG $750 billion, and "bailed out" General Motors to the tune of whatever $50 billion or so, just call the loan(s) or transfer the debt, Maddoff and Wall Street style, to pay other "obligations."

The point is the "notes" that are passed around government or otherwise, are so corrupted that this fearsome "default" with which Obama and Geithner threaten is no less BS than their giveaways to their handlers, e.g. Goldman-Sachs, in the first place. They are really just covering for continuing prodigious administration corruption. That is what Toomey is saying.

Force this administration to continue to lie and lie and lie some more, then call them on it. The latter is what the DC GOP will not do. The Tea Party does, and we all will have to take the hit for electing an utter a**hole, and especially his backers, to the US Presidency.

"They" really are the phoniest and most sinister agents to ever sit in DC (not that that doesn't now reflect the contemporary US electorate).

Johnny Suntrade, the Suntrade Institute

[SunkenCiv]

thanks SeekAndFind, related topic:

Team Obama’s Debt Limit Scare Tactics Are Getting Old — Fast
Fox News | May 19, 2011 | John R. Lott Jr.
Posted on 05/19/2011 2:18:20 PM PDT by JohnRLott
http://www.freerepublic.com/focus/news/2722277/posts

[Freedom_Is_Not_Free]

Geithner wouldn’t dare default. Never happen.

[Georgia Girl 2]

If they shut down HUD, Dept of Homeland Security, TSA, Dept of Energy, EPA, and Dept of Educ and all foreign aid I’ll bet they could squeak by.

[reed13]

I’ll go better than that. Anything created after 1880 should be shutterd:
Dept Creation 2009 budget employees
Agriculture 1889 134B 109,832
Commerce 1903 15.8B 43,880
Labor 1913 138B 17,347
HHS 1953 879B 67,000
HUD 1965 40.5B 10,600
Transportation1966 73.2B 58,622
Energy 1977 24.1B 109,094
Education 1979 45.4B 4,487
VA 1989 97.7B 235,000
Homeland Security
2002 40B 208,000

In addition ATF,DEA,EPA and I’m sure a number of others.

Interior can handle Social Security as it phases out - and I think it should be phased out with anyone less than 50 today not getting it.

VA can be handled by defense just like before.

Ed back to states.

Transportation??? - we built the interstate before 1966 without a transportation department - get rid of it.

Energy - yeah that’s worked out - gone.

Labor and Commerce - two sides of a coin - get out of coin flipping and let em work it out in the courts.

We need 5 depts: State/Treasury/Defense/Justice (added in 1870 and arguable- perhaps part of interior)/Interior. That covers outside/money/protection/crime/inside. Interior should be mainly to ensure the states play nice with each other, help with standardization, and manage our monuments.

Post roads and postal service are in the constitution, but we don’t HAVE to have them as the behemoths they are...and no where does it say they shouldn’t operate at a profit.

[Georgia Girl 2]

You get no argument from me. Sadly the GOP likes big govt just as much as the Dems. Its a two headed snake. Otherwise the Ryan plan would call for the elimination of some of these useless agencies. Especially the ones that were created by Executve Order.