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Posted by on Jul 15, 2011 in Economy, Politics | 17 comments

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?

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