ESAD is a double entendre -- the lesser known meaning being: If you do, you will.
Bon Appetit, RINOs, and RIP.
Posted on 07/15/2011 10:44:38 PM PDT by neverdem
On Wednesday, House Minority Leader Nancy Pelosi sent a warning on the debt-ceiling hike. “Let’s get on with writing the bill,” she said. “I don’t need to see markets drop 400 points. But Republicans may need to see markets drop 400 points.” Pelosi remembers September 2008, when the House, then controlled by the Democrats, initially voted against the Troubled Asset Relief Program. Stocks plunged 778 points. Only after her caucus felt the visceral terror of an impending depression was Pelosi able to cobble together votes to counter Republican opposition.
If the House goes to the wire this time, there will be plenty to fear. A Treasury default would be worse than the financial crisis of 2008. The world economy is built on Treasury securities. Companies around the globe use them as collateral for overnight loans so that they have cash to pay workers as they wait for their own payments from other companies. Because this collateral is so safe, the lenders who make the overnight loans don’t have to worry about the borrowers. The key is that Treasury bonds are supposed to be risk-free.
But nothing is risk-free. If and when the market discovers this about Treasury bonds, the consequences will be dire. Companies short of cash would shed workers. Global asset selloffs could send the slow-brewing Eurozone crisis into multiple defaults, and European governments would struggle to protect their own financial institutions from panic. The fear of default could spur companies around the world to hoard more cash in anticipation, slowing the economy down. In the past week, a parade of leading financial figures has sounded the alarm—Federal Reserve chief Ben Bernanke, JPMorgan Chase honcho Jamie Dimon, Senate Minority Leader Mitch McConnell, Treasury secretary Timothy Geithner, and former Obama economic adviser Larry Summers among them.
And that’s precisely the problem. Tea Party freshmen and their supporters hold this establishment in contempt. Implicitly invoking TARP, as Pelosi did when she mentioned a stock-market crash, won’t scare them; it will only embolden them. It would be one thing if Tea Party adherents merely believed that a default wouldn’t spell disaster; in that event, the GOP freshmen would figure out the truth soon enough. The problem is that many Tea Partiers consider TARP such a terrible idea that they would have chosen to brave a worse financial disaster instead. Today, they think that a market cataclysm would be better than another “sellout” vote. House veteran and GOP presidential candidate Michele Bachmann set the pace in last month’s GOP presidential debate: “I fought behind closed doors against my own party on TARP. It was a wrong vote then. It’s continued to be a wrong vote since then.” As the defeat of Utah senator Bob Bennett in 2010 showed, party voters are unforgiving of Republicans who supported TARP. A debt-hike vote will follow Republican candidates in their primaries next year.
Whose fault is the trust deficit that the elites have racked up? After the initial TARP vote, the establishment spun the story, calling it not a bailout but a “rescue” and insisting that its purpose was to save jobs, not banks. What have Americans seen since? Financial firms whose bad decisions should have put them out of business have logged huge profits, while 7 million workers have gone missing from the economy. Such a stark disparity in outcome is absolutely the fault of establishment figures—from former Treasury secretary Hank Paulson through President Obama himself. No surprise that Americans digesting that experience now suspect that a debt-ceiling vote is another trick.
TARP and the debt-ceiling vote do resemble one another—but not in the way that the Tea Party thinks. By the time TARP came around, it was too late to do anything about a financial system spiraling out of control; the only sane way to have avoided TARP would have been to end the government’s too-big-to-fail approach to the financial world long before, and that approach dates all the way back to the 1980s. The problem with TARP was not the vote for it but what government failed to do afterward: force lenders to take their losses, albeit in a less panicky manner, thus liberating the economy from the bubble’s legacy. And government failed, too, to enact financial rules to ensure that it wouldn’t happen again.
We’re in the same situation today. It’s too late now to worry about debt that’s the legacy of past choices. If either party had wanted to avoid such a vote, it should have taken steps decades ago. Such steps would have included self-restraint on new entitlement programs—including the Medicare prescription-drug benefit—until we figured out a way to control growth in the old ones. And the steps would also have included putting the rules in place to avoid a financial crisis that has sent tax revenues plummeting and safety-net costs soaring.
Both parties should stop pretending that the debt-ceiling vote is an opportunity for big fixes or a test of principle. It isn’t, just as TARP wasn’t. Even if party leaders can convince enough public-spirited members of their caucuses to vote on modest, long-term budget “reforms” in return for a debt-ceiling hike, these concessions are likely to be window dressing. Long-term fixes to programs like Medicare won’t happen overnight. They’ll come after years of open-minded experimentation. Likewise, cleaning revenue-sucking holes out of the tax code will take months, not a few late nights. With the debt ceiling, as with TARP, what really matters is what happens after the vote.
Nicole Gelinas, a City Journal contributing editor and the Searle Freedom Trust Fellow at the Manhattan Institute, is a Chartered Financial Analyst and the author of After the Fall: Saving Capitalism from Wall Street—and Washington.
LOL. Such tripe spewing from the hole of the idiot who FAILED to even PRESENT a budget is rich.
Right. And TARP (and the Porkulus) imposed on us trillions more in new debt and instituted a disaster of a spending binge that is drowning us today. Now we want to gulp down more of the same old snake-oil?
If the debt ceiling is raised, what will happen after the vote is... "nothing". It will be just more of the same - lots more. The plunge into complete dissolution of the American Republic will simply continue on with added momentum and less chance of recovery.
This out of control government needs radical surgery, now. We have a raging Stage 4 cancer there are no longer enough band aids and aspirin to cover it up!
How long could your family survive making $60,000 a year while spending $100,000 and putting the balance on the maxed out credit cards?
That pic is hilarious! Somebody needs to photoshop Dingy Harry into it :)
>>They gonna kill the squirrels?
“Nice tree full of squirrels you got there. It’d be a shame if it burned down...”
“Why Tea Partiers won’t listen to the establishment”?
Because “establishment”, it’s the “spending stupid”. We are tired of the financial ruin the spend and tax “establisment” has created to get votes.
[He might choose not to service the debt on purpose.
The Cloward-Piven/Soros strategy: Maximum Chaos
It’s definitely a real possibility]
I think this is EXACTLY what he plans to do, and Republicans know it. That is what has Republicans running scared. That is Obama’s plan, and he also plans to use the msm propaganda machine to pin it on the Republicans in 2012. Will it work? Obama doesn’t care because he has nothing to lose. He doesn’t love this country anyway.
Remember, Citizen...
nobama hates you, hates your family, hates Free America, hates the Constitution and hates the Bill of Rights. nobama is a hate crime foisted upon America. nobama is the Destroyer.
Everything nobama does is intentional.
God help us all.
Holding firm on the debt ceiling would not cause a default on treasuries; it would force congress to cut deeply, and that is what the establishment of both parties fear.
>> “The problem with kicking the can down the road, is that eventually you run out of road.” <<
.
We already have, and they are in denial.
Perhaps because he really DOES want to destroy the country and throw it into chaos, knowing he can get away with blaming the GOP and the Tea Partiers with the help of the network news and big city papers -- and with their help trigger a "popular uprising" which would demand (he imagines) what he's dreamt about all his life -- that he impose a dictatorship with him at the top. You asked. Just sayin'.
Obama is in full 2012 campaign mode on this. He has Boehner/McConnell/Cantor terrified and in a corner now. He tricked them into wasting time in budget negotiations that he knew didn't have a chance to succeed running out the clock to put them in this corner. The House could have been using that time to send the Senate debt extension bills with specific budget cuts. And one that ma es him pay Social Security, America's debt, etc, first if no extension was made.
You have to look closely at what Obama is telling voters in his press conferences. He is saying “I still want a big deal. I still want major deficit reduction. Congress needs to put politics behind them to work together for the American people. But in the end if congress (ie Republicans) cant get their act together and put politics aside, I will reluctantly accept a clean debt ceiling bill with no cuts to keep this country from defaulting on it's obligations” when he knows no big deal is possible. Everything Obama said is a complete fantasy, he is talking to the voters.
He is claiming he is willing to put $4T of cuts on the table with Pelosi’s help for the deal, a $4T that she could never get the votes for in the House, so that he cant even really offer, But it doesnt matter because clueless congressional Republicans didn't know that they were being taken, but they know it now. He established the visual (to voters) that he wants to make a big deficit reduction deal really really bad, but Republicans are saying ‘No’. And clueless Republicans appear unable to control the message.
McConnell/Boehner/Cantor know they blew it, that they were had. That is why they publicly proposed the surrender plan that allows Obama to increase the debt limit as long as he ‘proposes’ spending cuts, with no enforcement. And Obama will stroll in and sign the Republicans surrender, and then tell voters that he really wanted that big deal, but Republicans ‘forced’ him to accept a debt extension with no cuts.
It is a sad day, but what did you expect? You have to know what you are doing to win,
Our party is so hopelessly STUCK ON STUPID that I’m surprised if they don’t hand him the keys to the Treasury.
” Well, no matter how you slice and dice it or twist and turn it, the real problem remains the same. Big, bloated, expensive, overbearing government. And the solution is simple. Repeal ObamaCare. Shutter the EPA. Call off the ridiculous war on coal, oil, gas and energy. Scrap the so-called green energy boondoggle. Cut government salaries, pensions, benefits, unions, etc. Cut the strangling regulations and bureaucracy. Cut the red tape. End the war against capitalism. Cut the size and scope of government. Drastically cut the spending. Cut the taxes. Get the government off our backs and out of our way. Set our people free to produce and let the free economy soar!!”
From your lips to God’s ear!!
Of course I think they ought to stop the train. Somebody's got to do it -- the Dems just want the train wreck to have Michele Bachmann's name in the headline.
(a) TARP was a good idea, but in practice it meant that the bankers made billions and the people paid through the nose.
(b) But raising the debt ceiling is a different good idea, and the outcome will be the reverse: the people will pay through the nose and the bankers will make billions.
Sorry, I'm not buying it. Those who oppose insane, profligate government spending have exactly one ace card, their control over the debt limit. And when you have an ace card, you don't discard it and you don't negotiate it away. You play the darned thing, and let the chips fall where they may.
And add to all these ‘stop giving USA monies/funding to other nations all over the world’. The real secret kept from USA citizens for years is that their sweat and earnings do not only drive the economy of the USA but also prop up many other nations that live in ages past. I believe our Constitution as written and intended by the Founders has been prostituted over many years by international interests that hate our exceptional character except when it comes to saving their rear ends e.g. Russia or the former Soviet Union among others.
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