Thursday, July 14, 2011

The Debt Ceiling and American Politics


Viewing the current "debate" on the debt ceiling I can't help but wonder if any of these politicians have read books like David Graeber's Debt: the First 5,000 Years or T.H. Breen's very insightful The Marketplace of Revolution.  Debt has a long standing history.  Graeber says you can go back to the early agrarian empires and find elaborate credit systems.  Yet, Americans still seem deluded by this notion of the "self made farmer," which they so often use to characterize Colonial Americans.  Breen shoots this argument clear out of the water in his well researched book.

Once again, the Republicans have boxed themselves into a very tight corner.  As a way out of this impasse, McConnell has offered to extend greater executive powers to the President, so that Obama will take the heat for the domestic cuts that are being proposed, and not the Republicans. A debate on the budget has turned into a power play, as both sides jockey for the "high road" in the 2012 elections.

The Washington Post reports that no budget plan in recent decades offers more domestic cuts with fewer tax increases than the current White House plan.  The eye-catching bar graph drives home the point most effectively, yet the Congressional Republicans still say no.  McConnell appears too afraid that any "increase" in taxes will only come back to haunt them in the 2012 elections, and he has explicitly stated that his main aim is to defeat Obama.  This may very well be a case where the Republicans end up shooting themselves in the foot.

13 comments:

  1. And don't overlook Eric Cantor. He wants to be the new Boehner and is apparently willing to let John swing in the wind rather than help get a deal done. I still say that in the end the Republicans will only have managed to hurt themselves.

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  2. Well, perhaps I should qualify that. They will have managed to hurt themselves politically and the average American.

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  3. Seems like Cantor is orchestrating the whole thing. Mitch and Boehner appear as though they are at wit's end. Their whole political lives have been spent working out compromises that favor Republicans and Obama landed a near perfect budget plan that had 83% in domestic cuts and only 17% in increased revenues. You could hardly call them taxes. Yet, Cantor balked. They have trapped themselves into a pledge to make any budget "revenue neutral," thereby leaving virtually no room for negotiation. The Economist (a conservative bastion) called it "economically illiterate and disgracefully cynical."

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  4. Cynical and illiterate pretty much cover it, although I would add dishonest just for good measure.

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  5. What a mess this debt ceiling "crisis" has become. Boner tries to be the "man of the hour" only to see he is playing with a nest of rattlesnakes in his party. Meanwhile, Reid is all too willing to give the Republicans exactly what they want, over $2 trillion in social spending cuts without any revenue increases. Really makes you wonder what the Republicans are holding out for. Is this Economics Armageddon?

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  6. The way the Republicans are playing this reminds me of the old F Troop comedy routine where Agarn draws a line in the sand and dares another guy to step over it. When the other guy quickly steps over it, Agarn must turn to Plan B because he wants no part of him.

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  7. What gets me is how once again the "little man" has to pay for corporate excess. Here were the Republicans bemoaning the bank bailouts 2 years ago, but rather than close corporate tax loopholes and demand full payment on loans still outstanding, states have to cover the shortfall by having federal social programs slashed, not to mention all the people that benefit from these programs.

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  8. Well now that it's done and by all accounts accomplishes very little, we get to wait and see how this bipartisan committee behaves. As many commentators are noting, this committee is charged with doing the work a cowardly Congress is unwilling to do. This is all about deniability. Truly amazing.

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  9. And another thing. I was listening to NPR yesterday evening. Kai Ryssdal was interviewing a woman who was discussing Wall Street's take on the Debt Ceiling debacle. She wasn't saying anything very interesting until she noted that Wall Street would now be very interested to see what Congress was going to do about our problematic entitlements. That's when I began to respond out loud. "Wall Street," I more or less shouted at my poor, defenseless car radio, "is concerned about entitlements like Social Security and Medicare? Wall Street? You mean the jackasses who the American taxpayer bailed out two years ago to the tune of 700 billion dollars? That Wall Street?"

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  10. End of rant ....

    Last night I needed a change of scene so picked up Patti Smith's Just Kids. Odd that a book like this can win the National Book Award, but heartening too. It's a lovely human story.

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  11. That book is surprisingly well written. The bonus is that you don't have to listen to Patti sing.

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  12. I couldn't put it down last night. And what's so striking about the book is that it is well written, but it's very plain spoken -- I guess that's an appropriate way to put it. No literary bells or whistles, just a woman looking back on her life.

    She was at the Times award ceremony -- very odd, fragile-seeming person. Not at all what I was expecting, but reading this now I can see it. I don't think I've even heard her sing, so nice to know her through her book and her life rather than her music.

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  13. Austerity measures seem to be sweeping the world. The IMF busy imposing severe restrictions on its loans to Greece, which was also the case in Eastern Europe. Funny enough, the Scandinavian countries borrowed against their debt and seem to be doing just fine, while the rest of Europe muddles along.

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