Paul Krugman of the day – Part 2
Krug gives the clear headed, but unfortunate news that the GOP will not allow a debt ceiling increase because the teabags who call the shots would feel “disrespected” and walk away utter losers – something they are not willing to do. Also – President Obama will not budge on the debt ceiling because our system of government is at stake. So…
As the date approaches, the markets will start to freak out.
The assumption has been that Republicans will finally be moved to act by the market freakout. But given their behavior so far, why would you believe this? I can easily see Ted Cruz making a speech declaring that the freakout is all Obama’s fault, and that what the markets really fear is socialism or something — and the base believing it.
My bet now is that we actually do go over the line for a day or two. And what ends the immediate crisis is not Republican action but a decision by Obama to declare himself not bound by the debt ceiling. He can’t even hint at this possibility until the thing actually happens, because he has to keep the focus on the Republicans, and he has to make them demonstrate their utter irresponsibility before he can take any extraordinary action.
But maybe I’m wrong; maybe Obama’s lawyers have concluded that there’s really nothing he can do. If so, God help us all.
I buy all of that. The GOP isn’t moved by “pressure” because the are so throughly cocooned in a wingnut thought bubble that they actually think they are “winning” this thing. Rand Paul recently told CNN that a “managed” default in which we prioritized payments to Chinese bondholders wouldn’t even hurt the country because we could just tell our others creditors that we are good for the debt. They are not bound by reality.
As for the President’s lawyers – I trust that they’ll have the appropriate arguments at the ready.
“…but a decision by Obama to declare himself not bound by the debt ceiling.”
That isn’t going to happen. No foreigner is going to pay top dollar for a bond that might be ruled invalid by the USSC.
Nowhere noted here is that the Dems in congress of both houses will not go along with any Tea Party Takeover, no “grand bargains” and no giving away the store. Rand Paul? Ted Cruz? Oh please, do you really thing the senate is going to let these two call the shots? Do you really think the American people will stand for a plan to pay Chinese creditors first and screw the nation as a whole? We don’t know how it will all play out, but I suspect the Republicans, especially the Tea Party Types, have made a series of big mistakes. Perhaps not enough to topple them in the south but a disaster in the rest of the more rational country.
@bamboozer I agree, but they have not given themselves any outs other than complete failure. So, it is going to fall to the President to assert the constitutional authority of the Presidency to avert calamity. As if the country was under attack by Iran instead of Republicans.
Obama should make it clear that in this crash we will NOT bail out the banks or their investors. Bankers would beat a path to their wholly owned Republican congressman’s door insisting they end this now.
The only person dumber than Krugman who has a Nobel Prize is Obama.
Republican Leaders Announce Support For Deal In Exchange For Malia Obama
While members of the Republican Party have heretofore been resistant to any sort of deal with the White House over the issue of Obamacare, the Tea Party caucus authored and released a short, tersely worded statement this morning in which they agreed to a swift negotiation of an unstipulated spending bill if the president were to deliver “the firstling.”
“The girl. Bring us the girl,” said Congressman Steve King (R-IA) as he stood beside fellow Republican leaders during this morning’s press conference on the steps of the Capitol. “The bill may pass, but the firstborn shall be ours.”
“Heed our bidding,” added an unblinking Phil Gingrey (R-GA). “And thy wish shall be granted.”