Wednesday, January 16, 2013

Debt Ceiling? The Game is Afoot!

So now we look at the debt ceiling.

Primarily, there are two things at stake.  First, will the GOP stick by its vow not to lift the debt ceiling and thus destroy the full faith and credit of the USA while plunging the world's finances into Hell?  Second, will Obama stay firm on his pledge not to deal on this issue and thereby remove the debt ceiling from its hostage role now and hereafter?

Nate Silver pointed out in his blog yesterday that Obama can hang tough because, unlike the GOP, he faces no more elections. If the GOP crashes the economy, Silver argues, it will take the entire blame and is the only player vulnerable to paying a price.  I have already noted in a prior blog that the GOP Congressional Tea Partyers don't give a hoot about future elections for their party as long as the GOP voters in their individual ultra-red districts are happy.  They also aren't patriotic or humane or intelligent enough to care about destroying our economy and plunging the world into chaos.  They are the equivalent of psychopathic, i.e. no regard for the actual results of their actions.

It's very hard to do business with, or play a game with, a person who just doesn't care, for whom there are no rules, who doesn't even understand the game or the business at hand. It's like playing a board game with a four-year-old who keeps changing the rules.  Nothing you can say or do will persuade these debt ceiling people because they WANT the armageddon of a mighty crash.  They hate government, they hate Wall Street, they hate the international economy, and they hate people in the "47 per cent" who need (and have earned) their veterans benefits and their Social Security checks.

Thus it all comes down to John Boehner, Mitch McConnell, and the few non-crazy Republicans left in the House and Senate.  They can save the world if they choose to, just as they pulled the plug on the "fiscal cliff" two weeks ago.  Each GOP leader could allow the vote to raise the debt ceiling to come to the floor of his respective house.  With Democratic votes, it will pass in each with just a few GOP votes necessary in the House.  That's all very simple.

But why should John and Mitch do thus?  To save the world?  Are they different from the Tea Party GOP?  Well, yes, they are.  They do not drag their knuckles on the floor.  Or not quite.  And they probably care about the GOP doing better nationally than it's been doing.  They just lost a presidential election they were "supposed to" win.  Ouch!  And undoubtedly McConnell would like to see more Republicans getting elected to the Senate because that's the only way he can ever be majority leader of that august body.  He knows his guys can't win statewide elections if public perception of the GOP is in the cellar.  And the GOP was "supposed to" win the Senate last year.  Double ouch!

All that Boehner and McConnell need are "hooks to hang their hats on".  This is a political expression meaning (sort of) "the barest excuse".  If Obama can give them something, just any old thing, to make it look like they got something, then they can cave in and let the debt ceiling be raised.

Alternatively, they can decide to change the game entirely by saying that the target is no longer the debt ceiling but is sequestration.  If you've forgotten what sequestration is, see my prior blogs. Or just skip it entirely because it doesn't matter what McConnell/Boehner pick as the thingbobby.  All they have to do is create a target they CAN hit and then tell the Tea Partyers that they have won a great victory.  They can say, for example, that they are shutting down the government to protest the raising of the debt ceiling but raise the debt ceiling anyway.  That makes no sense, but neither do the Tea Party people.  Shutting down the government for a couple of days isn't world-shaking.  Newt the Gingrich did it in the Clinton era.  The only adverse results were that I didn't get to see the Vermeer show at the National Gallery, the GOP lost the House in the next election, and Newt Gingrich was driven into the wilderness from whence he has disgustingly returned of late.

Boehner/McConnell will, in short, think of something.  After all, they started this scenario, and thus they have the power and the duty to find their way out of it.  (Next time I'll whisper a suggestion to them.)

Cleverly, Obama's White House has rejected the platinum coin ploy.  Not rejecting this Monoply money solution would have telegraphed that Obama was taking the GOP threat seriously.  This he has been studiously careful not to do.  It's also why he has not discussed the alternative of invoking the 14th amendment.  You don't start counting life boats before you've struck an iceberg.  He is acting as if he will not deal with the GOP on the debt ceiling and, further, that he doesn't believe they dare do the deed. Therefore, he proposes no solutions. The GOP stepped in the cat's dish; the GOP can clean up the mess.

So far the world markets have joined in Obama's apparent belief that the GOP is bluffing.  The stock market is up.  Fed paper is selling well and with low, low interest rates.  Consumer spending in November-December was higher than originally thought.  

So Boehner and McConnell go on lurking behind the kitchen door, threatening to jump out and shout "boo".  Just as in 2011.  But everybody knows they are there behind the door and that they did not blow up the world in 2011.

It's awfully hard to get scared when the kids pull the same non-stunt twice, isn't it.  We been there. We done that.  It's old, John and Mitch.

Stop playing and get serious, guys.  Pay the bills the government already owes.  As for lowering the debt, get back to us when the economy is stronger.  Then make us an offer we really can't refuse. And not something involving the kitchen door.



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