Man Of Orange Concedes

[Conan71]

Wasn't it McConnell who stated that the entire purpose of this manufactured crisis is to put the screws to Obama and prevent him from being reelected? Usually, I'm fine with that. Risking a recession just to achieve your political aims is pretty much disgusting.

Agreed.  Hoping for the failure of the President on the backs of the American public is politics at it's worst.  I'm so close to changing my voter registration to Ind but still can't bear the thought of losing my right to vote in local primaries which are important to me.

[Teatownclown]

Agreed.  Hoping for the failure of the President on the backs of the American public is politics at it's worst.  I'm so close to changing my voter registration to Ind but still can't bear the thought of losing my right to vote in local primaries which are important to me.

You do it and then I'll go.....

Oh, the lessor of two evils is still evil. Just have a final beauty contest. You'll look younger with a new Ind.

[Gaspar]

Just truth telling with a little sarcasm. Why do you feel the need to lash out at clowning around? You find mirrors frightening? Let's face it Gassie, this deficit/debt ceiling battle has been fought to keep Obama from winning a second term. Answer me this, why are so many in DC hell bent on not working together? So current power appears inable to lead. It's not directly about race, but race is part of the "problem" for the GOP/Teabaggers. It's possible to distinguish them by their make up.
Maybe they should dress up like clowns so we can't take them seriously.

You completely miss the point.  The house was turned on it's ear last year by a small political movement, The Tea Party.  Now Republicans are terrified of them, not because they pose a threat as a party, but because they pose a threat as a philosophy. 

The Tea Party is the philosophy that Republicans have always given lip-service to but never followed.  Now they realize that they run the risk of losing their job if they act in a way that is not consistent with fundamental conservative philosophy of limited government.

[RecycleMichael]

The Tea Party is the philosophy that Republicans have always given lip-service to but never followed.  Now they realize that they run the risk of losing their job if they act in a way that is not consistent with fundamental conservative philosophy of limited government.

+1

[nathanm]

The Tea Party is the philosophy that Republicans have always given lip-service to but never followed.  Now they realize that they run the risk of losing their job if they act in a way that is not consistent with fundamental conservative philosophy of limited government.

You are so full of smile it's not even funny. Under successive Republican-controlled Houses, federal employment ratio has fallen from a 1970ish peak of around 1.1% of total population to a little over 7 tenths of a percent (up from a post-1950 low of about .66%):



Too bad Republicans won't take the blame for trying to get an unrealistic bill through Congress and blowing up the economy in the process. There's exactly one thing tempering my pessimism on the results of a default: The banks have built up well over a trillion dollars in excess reserves, so when the overnight markets collapse, they might have enough liquidity to avoid outright failure. Without an extension of the debt ceiling, FDIC only has maybe 60-80 billion to draw on in the insurance fund. Were it not for the excess reserves, I wouldn't be terribly surprised to see enough bank failures to completely tap out FDIC.

[RecycleMichael]

I hate to agree with gaspar over nathanm, but I will here. He said the party needed to be "consistent with fundamental conservative philosophy of limited government".

Philosophy. Not practice.

I truly believe that one of the only differences between republicans and democrats is government employment. Many republicans dislike anything run by public dollars (except war) and democrats believe that if we don't operate public schools and public programs, then our lives will be worse dealing with related problems.

People in big urban areas generally see the benefits of government run programs like transit, libraries, and public schools. That is why people in really big cities are generally registered democrats.

[AquaMan]

Nice graph. I was curious why it spiked every decade or so then I realized it represented the census workers. Strange how each of those census spikes also correlates with a recession. Curious to me.

It really irritates me that all the media, including our local rag, act like this crisis is (a)anything but manufactured for political reasons, and (b) equally the result of Dems and Repubs or something called "Congress" without noting that "Congress" is mainly Republican.

My gawd, this morning's World described how the inaction of "Congress" to fund the FAA has put a hold on airport projects. Even pictured a local Republican Mayor. That failure to fund is because of a Republican in Florida who is trying to weaken the Unions' ability to negotiate and is holding public air travel hostage! Not "Congress" , some silly politician goin' after Unions with the support of his Republican majority in the house! He intends to do so "till we get this mess straightened out..." He created the mess and blames it on his opponents. Outrageous.

Why are people afraid of the truth?

[nathanm]

I hate to agree with gaspar over nathanm, but I will here. He said the party needed to be "consistent with fundamental conservative philosophy of limited government".

Philosophy. Not practice.

Is there more to the practice of the limited government philosophy these days than tax cuts, entitlement cuts, and shrinking government employment? What visible difference would there be if Gaspar's philosophy were implemented in the face of political resistance? I believe it would be almost exactly what we've seen.

I've always been a fan of the true Scotsman, though. Just wish I could find him.

[Gaspar]

I hate to agree with gaspar over nathanm, but I will here. He said the party needed to be "consistent with fundamental conservative philosophy of limited government".

Philosophy. Not practice.

I truly believe that one of the only differences between republicans and democrats is government employment. Many republicans dislike anything run by public dollars (except war) and democrats believe that if we don't operate public schools and public programs, then our lives will be worse dealing with related problems.

People in big urban areas generally see the benefits of government run programs like transit, libraries, and public schools. That is why people in really big cities are generally registered democrats.

I could argue about the subtleties of what you are saying, but not the logic.

I am not totally against the public funding of such operations, just the public funding AND operation.  Remove that last layer and you have a more efficient system with competition and freedom of choice.  I.E. school vouchers.

[we vs us]

After watching last night's and today's house wrangling, I've come away convinced that there is literally no compromise possible between what the House will pass and what the Senate will pass.  And this, of course, doesn't even include what Obama will or won't veto. No matter what he does, Boehner can't win.  I don't think this is as much an indictment of Boehner as it is an indictment of his caucus, which can't find a compromise at all.  As has been pointed out, the Democrats have bent over backwards to give ground on virtually every core demand of the House GOP Tea Partiers . . . up to and including Reid's offer of a day or two ago that had $1.2B in cuts, no revenue raisers, and put the ceiling in a place where it wouldn't have to be discussed till after 2012 elections.  That even goes beyond one of Boehner's House bill.  But it doesn't matter, because the House GOP does not want the ceiling raised, regardless of what they're offered.  The point is to make a point, and they'll do it by crashing the economy into a brick wall. 

[Conan71]

After watching last night's and today's house wrangling, I've come away convinced that there is literally no compromise possible between what the House will pass and what the Senate will pass.  And this, of course, doesn't even include what Obama will or won't veto. No matter what he does, Boehner can't win.  I don't think this is as much an indictment of Boehner as it is an indictment of his caucus, which can't find a compromise at all.  As has been pointed out, the Democrats have bent over backwards to give ground on virtually every core demand of the House GOP Tea Partiers . . . up to and including Reid's offer of a day or two ago that had $1.2B in cuts, no revenue raisers, and put the ceiling in a place where it wouldn't have to be discussed till after 2012 elections.  That even goes beyond one of Boehner's House bill.  But it doesn't matter, because the House GOP does not want the ceiling raised, regardless of what they're offered.  The point is to make a point, and they'll do it by crashing the economy into a brick wall. 

I think "crashing the economy" is Y2K talk.  I'm not seeing that at all out of this.  Our bond ratings might get lowered (which will happen at some point if we don't reign in spending and figure out how to start paying off our debt) which will mean we spend more in interest.

I'm not happy at all about the idea of the feds needing more of my tax dollars to pay off their mistakes and quid pro quos, but it's obvious we have got to bite the bullet and give up this "no new taxes at any cost" stance.  Take the spending cuts and give a like amount of tax increases.  It's not that friggin' difficult, House Repuglicans!

[Townsend]

It's like the girls and boys are on opposite sides of the dance floor and they're playing crappy music.

http://www.npr.org/blogs/thetwo-way/2011/07/29/138820004/to-appease-tea-party-boehner-adds-balanced-budget-amendment-to-bill?ft=1&f=1001&sc=tw&utm_source=twitterfeed&utm_medium=twitter

[nathanm]

I think "crashing the economy" is Y2K talk.  I'm not seeing that at all out of this.  Our bond ratings might get lowered (which will happen at some point if we don't reign in spending and figure out how to start paying off our debt) which will mean we spend more in interest.

I wish it were that simple. It could very well set off a liquidity freeze, which could very well imperil some banks, which could very well take out the FDIC, which is running somewhat low on funds. I don't think that's the most likely scenario, but it's certainly within the realm of possibility. It'll also be interesting to see what bills Treasury decides to pay.

http://about.bgov.com/2011/07/12/august-invoices-show-u-s-treasury%E2%80%99s-limited-choices/

The CRS put out an interesting backgrounder on the difficulties presented by being up against the debt ceiling:

http://www.fas.org/sgp/crs/misc/R41633.pdf

Edited to add: By the way, as I think I've been repeating regularly, I think your balanced approach is precisely what we need. I just think we ought to wait on actually putting the tax increases and spending cuts into effect. Tie them to economic performance or something, but make the revenue/spending targets binding once the economic performance targets have been met, that way Congress need not pass another bill to put the policy changes into place.

It doesn't matter whose economists you ask, they pretty much all agree that cutting spending and increasing taxes will slow the economy.

[Conan71]

I wish it were that simple. It could very well set off a liquidity freeze, which could very well imperil some banks, which could very well take out the FDIC, which is running somewhat low on funds. I don't think that's the most likely scenario, but it's certainly within the realm of possibility. It'll also be interesting to see what bills Treasury decides to pay.

http://about.bgov.com/2011/07/12/august-invoices-show-u-s-treasury%E2%80%99s-limited-choices/

The CRS put out an interesting backgrounder on the difficulties presented by being up against the debt ceiling:

http://www.fas.org/sgp/crs/misc/R41633.pdf

And I could very well win the Mega Millions or Power Ball lotteries tonight and/or tomorrow.

"Could very well..."

Again, Y2K talk.  Y2K could have very well paralyzed many things, yet it didn't.  All it seemed to do was boost bottled water, fuel, and grocery sales.  There's so much hysteria from both sides, I don't think anyone has a real clue what happens.  

Here's why I'm not as concerned: taking the 2008 crisis into consideration, the banking system was one of the first things to get protected even though it's "sure" collapse was upon us.  It will be protected vigilantly.

Aside from that, we will come to the brink once more in this tacky game of political theater and there will be an 11th hour resolution which will have everyone glad-handing each other and slapping each other on the back while arch conservatives and arch liberals continue to biznitch about how they got sold out in a compromise.

/edit: And point well taken on your edit.  If only I were running the show

[nathanm]

Again, Y2K talk.  Y2K could have very well paralyzed many things, yet it didn't.  All it seemed to do was boost bottled water, fuel, and grocery sales.  There's so much hysteria from both sides, I don't think anyone has a real clue what happens.  

Here's why I'm not as concerned: taking the 2008 crisis into consideration, the banking system was one of the first things to get protected even though it's "sure" collapse was upon us.  It will be protected vigilantly.

Aside from that, we will come to the brink once more in this tacky game of political theater and there will be an 11th hour resolution which will have everyone glad-handing each other and slapping each other on the back while arch conservatives and arch liberals continue to biznitch about how they got sold out in a compromise.

Ironically, the reason Y2K turned out not to be any sort of a problem is that the hysteria induced companies to spend the money necessary to get everything fixed up before 1/1/00. That's not to say that I think the most dire predictions were at all likely. I expected inconvenience at worst, not all out stick your head in the sand disaster. I also think that's the most likely outcome of the debt ceiling being reached and Treasury running out of money. (well, if you count an extra $100 billion a year in interest as merely inconvenient, but that may happen regardless)

That said, the more dire scenarios are not at all outlandish. Retirement funds and money market funds can continue to hold Treasury securities no matter what the rating, so there shouldn't be a forced selloff. Nonetheless, if panic was to ensue, it could destabilize things in unpredictable ways. We're playing with fire here. We're not likely to set off a fast-moving brush fire, but that doesn't mean it isn't possible.