Tuesday, July 19, 2011

This is why I'm worried

I still believe that Congress will figure out a way to increase the debt ceiling, but it's hard to see how it's going to get done in light of facts like these:

[M]any Republican House members are absolutely genuine in their adamant belief that stopping an increase in the debt ceiling -- an archaic relic from World War I -- that has been raised dozens and dozens of times without incident -- is a good way to combat deficits, which they truly believe are about to turn America into Greece. This view seems particularly pronounced among the 87 Republican freshmen (who together account for nearly 40 percent of the entire GOP conference) who were elected last fall. To many of them, the debt ceiling is a new concept; they haven't been in Congress for years, routinely voting to raise it. What's more, many of these freshmen are also convinced that the deficits that so upset them are the result of their own party's unwillingness in the past to stand firm at moments just like this one.


Perhaps the best example of the resistance GOP leaders will face when they push a deal comes from Rep. Todd Rokita, a freshman from Indiana. In an interview with ABC News' "Top Line" on Monday, Rokita said that even $4 trillion in immediate cuts -- three times the amount that is apparently now being discussed by GOP leaders -- "may not be enough" to convince him to support a deal. A default, he suggested, could be a good way of forcing the country to live within its means -- "even if the stock market does go down, if the economy does get worse."

You can call this crazy, and maybe it is. But remember: The 4th District that Rokita represents is overwhelmingly Republican. When he was elected last year, it was the GOP primary (which he won with 42 percent of the vote), and not the general election (when he cruised with nearly 70 percent), that Rokita had to worry about. In other words, not only is it likely that Rokita genuinely believes what he's saying about the debt ceiling, it's also likely that he'll be rewarded for it by the folks back home.

Funny thing is, I actually sympathize with Rokita's basic sentiment. But, oh my God, does he (and, more to the point, his supporters) seem to have no freakin' clue what kind of fire he's playing with.


Balaji said...

What is debt ceiling? What do you suggest us should do to reduce the enormous amount of debt? Surely continuous raising of borrowed money is not a permanent solution.

Ron said...

> What is debt ceiling?

It's the legal limit on the total amount the United States can borrow.

> What do you suggest us should do to reduce the enormous amount of debt?

Cut spending and let the Bush tax cuts expire. It's a no-brainer. (I would actually raise top marginal tax rates even further, but that's not politically realistic.)

> Surely continuous raising of borrowed money is not a permanent solution.

Indeed not.

Balaji said...

Do you believe that the US govt has huge amount of unnecessary spending.

MN is also having the same problem with a state shut down going on. The solution part proposal is to take money from education..I am not sure if that is such a good idea.