Quote of the Day: The GOP’s Debt Ceiling Kamikazes

Our political Quote of the Day comes from The Daily Beast’s John Avlon, who looks at the GOP’s debt ceiling kamikazes — GOPers who insist despite what experts say that default on the debt would be catastrophic. Some excerpts from this must-read-in-full column:

Call them Debt Ceiling Deniers. Believers in faith-based fiscal policy. Math-challenged cause-and-effect-skeptics. And an uncomfortable chunk of the GOP’s 2012 contenders.

The costs of courting conservative populists should be clearer than ever to reality-based fiscal conservatives inside the Republican Party. Their “all-or-nothing” meets “what, me worry?” negotiating stance is not only the newest symbol of D.C.’s dysfunction—it is beginning to have an impact on the entire U.S. economy.

After all, S&P is now warning of a possible downgrade to America’s credit rating because of concerns about our political ability to raise the debt ceiling by August 2. Moody’s similarly announced it is considering a downgrade of the U.S. bond rating. Bush-appointed Fed Chairman Ben Bernanke calls the looming prospect of a default on our debt “catastrophic.”

But Michele Bachmann believes it’s all a hoax. Tim Pawlenty told an Iowa crowd, “I hope and pray and believe they should not raise the debt ceiling.” Ron Paul based his first presidential ad on a call to not raise the debt ceiling, proclaiming “No Deals.” And Rick Santorum has said that raising the debt ceiling should be avoided until a Balanced Budget Amendment to the Constitution is passed.

This position is a long way from saying the vote to raise the debt ceiling should be contingent on a deal to reduce the deficit and the debt. It is not looking for leverage or savvy negotiation on the way to a settlement. Instead, it is prideful ignorance—an eagerness to go off the fiscal cliff to show the world that gravity does not exist.

The fact that defaulting on our debt would raise interest rates—deepening the fiscal hole we’re in by compounding the size of our deficit and debt overnight—is not addressed. Instead we are greeted with nihilistic bubble talk—at its best, economic incompetence and at its worst evidence of tactical Leninism—the belief that “the worse things get, the better they are for me politically.”

Avlon notes how this attitude has picked up steam in Congress. And, indeed, you hear it on conservative talk radio as well: an underlying belief on the part of some callers that a) what’s the big deal about default? b) if it happens it’ll be good politics because then people will see how poorly Barack Obama’s presidency was. He goes on:

If you argue with a fool, you’ve got two fools. Nonetheless, I thought a reality check might help some of the Republicans in Congress currently deciding how they’ll vote as we pedal ever closer to the cliff that is the August 2 deadline.

So I reached out to two former Republican chairmen of the Council of Economic Advisors, with presumably impeccable fiscal conservative credentials: Michael Boskin, who served under Bush 41, and Glenn Hubbard, who served under Bush 43.

Read the detailssbut, no, they don’t agree with Bachmann that default would not be that awful, or with the Republicans on some of the cable shows who say even with default the U.S. would have enough money if it just prioritizes things, or that experts are exaggerating or with the hints that those who say it’ll be catastrophic are somehow in some kind of conspiracy with Obama. Those in conspiracy, in that view, would presumably include Boskin and Hubbard. Avlon writes:

Got that? The deficit and debt are serious problems. Let’s have a vigorous debate on how to best address them. Let’s negotiate the best deal possible with spending cuts, tax reform, and entitlement reform. And then let’s put alternatives to the American people in 2012. But don’t take the U.S. economy off a cliff just to prove your point.

Senate Minority Leader Mitch McConnell’s proposal—a procedural plan that would allow the president to unilaterally raise the debt ceiling as long as he promised a commensurate amount of spending cuts—seems to me an acknowledgment that the conservative populists could stop a debt-ceiling vote, something that strikes McConnell as fiscally irresponsible and politically unwise for the Republican Party. It is a tacit admission that the inmates are damn-near running the asylum.

The deal-makers in the Republican Party—like Speaker John Boehner—are finding themselves fighting with debt-ceiling deniers, with the full faith and credit of the United States hanging in the balance.

Even supposedly responsible Republican presidential candidates like Mitt Romney—whose campaign slogan might as well be ‘He’s the Sane One’—are finding it politically beneficial to flirt with debt-ceiling denial, announcing a ‘cut, cap and balance’ proposal without revenue increases as his ‘line in the sand’ for supporting raising the debt limit.

But this beast cannot be appeased. As with all absolutists, the goal-posts keep moving. …

The debt-ceiling deniers could be dismissed as just another branch of the conservative populist tribe at war with modernity. Except this time the enemy isn’t science—it’s math. And international markets don’t respond well to denial.

The growing popularity of this position among the 2012 contenders should cause real fiscal conservatives in the GOP to take a hard look in the mirror—because the conservative populists they have helped empower for short-term political gain are making long-term fiscally responsible governance almost impossible.

By encouraging default, the debt-ceiling deniers are playing politics with people’s daily lives. They are making the prospect for economic recovery even more distant while unintentionally adding credence to our competitors’ mistaken belief that America is a great power in decline.

What is in decline? American politics’ ability to transcend American politics itself — the ability to put aside partisan thirsts for a moment at least and do something during a crisis that’s for the greater good in a way that defuses tensions. Today it’s 24/7 polarization and those who don’t want to play the game are painted as weak.

The irony: polarization has become a multi-million dollar industry on talk shows, cable, and the new and old media. And in the end — if the U.S. defaults to it — it could be a massive money loser for the United States itself.

What was that quote again?

17 Comments

  1. It is really getting scary. Its not just that they are playing with matches. They refuse to believe that fire burns.

  2. Liberals shouldn’t overreact. I believe the worst in the GOP is simply inept. “Cut, cap, and balance” is what Americans want, but not if it holds the current, short term oriented (properly) debt limit increase hostage. As of now it’s amusing or laughable, that’s all. (And don’t forget the crappy behavior of Dems who now claim to want to strike a big budget agreement but are pushing stupid demagogic tax hike gimmicks while being generally mindless about entitlement reform.)

    We’re getting closer to what some of us have now expected, given the forlorn hope of the start of long-term fiscal reform (spending controls and discipline, the core because that is what truly long has been needed). Plus there’s no logical obligation or “requirement” for a big budget (and policy) agreement accompanying the debt ceiling. It’s good, better should be done, getting spending under control, but it’s unlikely and any GOP that behaves as clowns only will make the rating agencies and others nervous.

  3. “GOPers who insist despite what experts say”

    Experts schmexperts! Who needs em! Facts? Logic? Science? Sense? The times they are a changin Virginia!

  4. The GOP is committing a shockingly unpatriotic Act of Economic Terrorism.

    They will kill the US economy and injure us all in the name of their radical ideology…just like the Islamoterrorists.

    And we should treat them the same way…send in the drones! And arrest the surviving Congressmen who refuse to “pay the bills that they created!”

  5. DLS,

    Only 20% of people think we should balance the budget with spending cuts alone. The GOP is totally out of the mainstream with their position. The Democrats, however, are requesting what the public wants.

  6. Z5,

    How many know that the Washington definition of a cut isn’t a cut?

  7. SteveinCh,

    I have no idea, but I suspect not many.

    I think most of us, and the Gallup poll supports this, agree we need spending cuts (real cuts) and tax increases. The devil is going to be in the details, but intransigence on taxes is not helping and is not supported by most of the public.

  8. It doesn’t matter how much your fee-fees are hurt by the high deficit or the debt. If you allow any kind of hostage-taking with the debt ceiling to lower spending, you are accepting terrorism. The only sane response to the GOP is to condemn them – or why don’t we imagine democrats threatening something like that just to get their way on something?

    It’s a weapon that is not supposed to be considered.

  9. Balancing the budget with spending cuts alone, Z5, you are right. But I never said it should only be through spending cuts. I have correctly stated that it should be primarily if not exclusively (if we got lucky) through spending cuts, since the problem we have is with spending, not insufficiently high taxes.

    As for balancing the federal budget (whichever way you most want it to be done), that’s what most people in this country want.

  10. Z5, once again regarding what Steve said:

    [Rothbard]

    There must be big cuts in federal government spending, and that means real cuts, “cut-cuts,” and not “capping,” cuts in the rate of growth of spending, cuts in projected increases, consolidations, spending transfers, and all the rest of the nonsense that has altered the meaning of the simple word “cut.”

    It should have been clear before, and if you missed it, it’s here now.

  11. I believe polls show that over half of people think we should NOT raise the debt ceiling (I think they’re wrong). The GOP would be in line with the public on that. I bring it up only to show why I think polls are kind of useless much of the time.

    Overall I agree with the tone of the article, but the exact effects of refusing to raise the debt ceiling are unclear. You can find an economist to support any theory you want. Because of that I don’t think that Bachmann’s, etc position is necessarily wrong. I do think they are way too sure that they are right, and have failed to consider the consequences if they are wrong. At the risk of sounding like GHWB, it wouldn’t be prudent not to raise the debt ceiling.

  12. That’s my point Z5, we don’t need real cuts to hit the $4 trillion target. Relative to the President’s budget submission as scored by the CBO, we save more than $4 trillion over the next 10 years if government spending grows at the rate of population plus inflation.

    If we could just hold real per capita spending constant for a decade, we’d more than cover the President’s bold plan of saving $4 trillion.

  13. One problem here is with contingencies. Projections always include a lot of rosy assumptions like an infinite tolerance for debt by the market, no new spending (including things like bailouts, disaster relief, and new or escalated wars), and most importantly, no more downturns.

    There needs to be plans in place that prioritize spending and taxes when the inevitable new crisis appears.

  14. It’s simple. Cuts and taxes. Both. Together. Anything else is BS. Also, Eric Cantor is an idiot.

  15. JSpencer, how dare you insult idiots like that??

  16. He’s appealing to idiots. All that’s missing is the word “balanced.”

  17. I made my previous posting in Albuquerque while rushed, and now that I have slightly more time up here in Santa Fe, more is in order.

    First, I apologize ahead of time (before he chooses to make any remarks) to J. Spencer if he is offended by what I wrote. I was responding rushed-ly to what J. Satterfield posted, if it in any way implies that those of us who are informed rather than lock-step liberals, the real idiots along with a few GOP militants, on this site are idiots.

    If a budget agreement, in addition to the debt ceiling rise, is to be secured with the Democrats, than some tax increases are in order. That part is true.

    The problem is with the attitude — where is the contrition from liberals and Democrats, and the admission that spending is the problem and which primarily or exclusively should be addressed, including entitlement reform, the core of our fiscal problems, rather than rush to tax increases instinctively? And where is the admission that demagogic gimmickry, appealing to true idiots and worse, such as fixating on oil companies or worse, corporate jets, has no respectable as well as intelligent place in broad fiscal reform?

    I also don’t like the demagogy and the true appeals to idiots with references to “revenues” rather than taxes and now with the smarmy emotional-appeal use of the word “balanced.” Pathetic and irritating!

    Also, where is the admission of the hypocrisy (not mere irony) in defending spending (in general, not must mindless refusal to reform entitlements) as a stimulus measure, while seeking anti-stimulative tax increases at the same time?

    I’ll add that I’ve posted more than once a truly productive tax-rise example, that is also part of entitlement reform — raising the FICA taxes and raising or abolishing the cap at the same time, along with expanding the scope of FICA tax base to include all forms of compensation (such as stock option grants or their later exercises, and outright grants of stock).

    Meanwhile, it should be remembered that if any fiscal agreement can’t be reached, there is no need for it; all that’s the real issue right now is the debt limit and raising it to prevent default soon.

    Food for thought, for those who can think

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