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Sunday, October 23, 2016

At long last President Obama seems to have run out of patience with the truculent Republicans who have rejected all of his overtures for a budget deal — just as Moody’s and other economic authorities again warned of the potentially catastrophic consequences of a debt default.

On Wednesday afternoon, Obama finally stood up at the bargaining table and walked out of the stalemated budget talks, warning House Majority Leader Eric Cantor (R-VA) that he will “take this to the American people” unless the Republicans showed a real inclination to compromise. Exactly what the president meant is not yet clear, but at least some leading Republicans have begun to realize that their party’s continued pandering to its hardline base could have serious consequences for them as well as the country.

Indeed, political schizophrenia suddenly broke out among the Republicans on Capitol Hill even as Obama confronted them in the White House. In the Senate, a panicked Minority Leader Mitch McConnell (R-KY) proposed a near-complete surrender, with a three-step maneuver that would allow the debt ceiling to rise while permitting the Republicans to pretend that they disapprove. Seeking to justify the abandonment of his own hard-line rhetoric, McConnell told right-wing radio host Laura Ingraham that blowing the August 2 debt ceiling deadline could lead to the same political result as the government shutdowns of the Clinton era – only perhaps worse.

Suddenly, McConnell appears to have realized that an unprecedented Treasury default could not only cause permanent damage to the nation’s credit and the world economy, but might well ruin the Republican Party, too. Noting that President Clinton easily won reelection the year after he faced down a Republican caucus in a budget debate that led to two government shutdowns, McConnell predicted that Obama “will say Republicans are making the economy worse…It is an argument that he could have a good chance of winning and all of a sudden we have co-ownership of the economy. That is a very bad position going into the election.” Letting the country default is a bad idea, he said, because it “destroys the GOP brand.”

In other words, American voters might blame Republican candidates for a worsened recession, caused by their ideological obsession and partisan selfishness. Voters might also grow disgusted with Republican legislators more concerned with demagogues like Michele Bachmann than with experts like Ben Bernanke, the Federal Reserve Chairman who outlined the consequences of default in Congress on Wednesday. The storyline of a default should not be difficult to follow, even for the average politician, as explained by Bernanke, whose Republican credentials are impeccable.

Bernanke told the House Financial Services Committee that default would cast grave doubt on the value of the Treasury bond, which “is viewed as the safest and most liquid security in the world, and the notion it would become suddenly unreliable and illiquid would throw shockwaves through the entire global financial system.” Bachmann may disparage such warnings as “scare tactics,” but the threat that default portends for everyone from grandmothers depending on Social Security checks to the struggling economies of Europe and Japan is real. Indeed, its effects are already being felt.

Where Obama’s frustration will lead remains to be seen. What did he mean when he told Cantor not to “call my bluff”? Although Obama, the constitutional law professor, would prefer not to invoke a controversial 14th Amendment power to overrule Congress and raise the debt by fiat, he could now cite McConnell and many other Republicans in his defense. Should the Republicans in the House seek to impeach him over such a move, he could say that he was responding to a clear and present danger to the nation and the world – and that the leaders of their own party in the Senate agreed with him.

Americans who broadly oppose default – and favor increasing taxes on the rich to avoid it – might well be persuaded by that argument.

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Copyright 2011 The National Memo
  • ron lang

    high fives to the pres. the clogs in washington are cantor & mckanell. i say put all the congress in chamber & lock the door & don’t let them out till we have an agreement that is good for the american people. politics as usual stinks, road black after road block. conress isn’t thinking of the good of the country they are only interested in their re-election & taking down the pres.

  • JamesHoppe

    Congress HAS to stand firm on MAJOR cuts to take effect IMMEDIATELY, not 10 years down the road. Cut 1, a relatively minor one, Foreign Aid. Fix things AT HOME FIRST. Cut 2, Downsize DHS and the TSA since all the TSA seems to be able to accomplish is checking Depends and groping 6 year olds. Number 3, defund ObamaCare entirely. Five, BRING OUR TROOPS HOME. The only overseas bases should be NATO or equivalent depending on the region. The only tax “increases” should be the closing of existing loopholes until the IRS can be disbanded. Replace the Federal Income Tax with a National “Fair Tax”. Here is a proposed Amendment to Michigans Constitution:

  • Diforabetteramerica

    Democrats lost the house because they are wimps, not because America loves the Republicans. It is time for Democrats to stand up as a united group and call it like it is. In other words they need to do their job and stop pandering to the ridiculous right. The Average middle American needs to stand up for themselves and demand that if we are going to have services and our income cut then the congress needs to go first. They need to drop their pension for life, not get paid if they don’t get the job done, and pay there own gym membership at full value. If they bounce a check they should pay the price, just like every other citizen of this country. The Republicans don’t want to raise taxes on the rich, because it would apply to them. They don’t care about the American People, only about individually maintaining their current wealth. America needs to wake up and realize this is all about the haves and the have nots, not about balancing the budget.

    • steve miller

      you jackwagon, its not about the haves and have nots… they are both Americans.. its not about who should pay the tax increase… its about why should the government need more money… they need to cut their own budgets and live within their means just like all Americans have to. Rich or Poor we live on our own money… PERIOD.

  • cumacaray

    Mr. President,

    The people know. Even moderate Republicans are fed up.

  • aye008

    Take a look at this “Way to survive”…..Unregulated, simplify tax by increasing no of tax payers which are the poor and middleclass but lower tax for the wealth, no limit on money support for election campaign, legally hide names, particularly, who support the politicians, cut spending program for the poor, help the already rich companies by giving tax break and cut R&D support as much money went to war.
    Above are the theme of Romney and Ryan. Give them your vote please. You are not dump

  • coytebob77

    What Obama means to say is what he has always said; Give in to my ruinous, wasteful spending or I will make the American people suffer and sell it to them in a way that makes it look like your fault. Judging by what’s been going on over the past several weeks it seems more and more clear that even with most of the media in his pocket, America isn’t buying his BS anymore.

  • Actions should speak louder than words. My dad can hardly walk due to Parkinsons disease; however, in 2002 he proudly carried the Olympic torch on its way to the Salt Lake City Olympic Games. Because of Mitt Romney’s leadership the games were not cancelled, and because of that my dad still looks at his torch with fondness as he tells his grandchildren about that experience.