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Debt Ceiling Repercussions

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The far right has no clue what they are messing around with. Raising the debt ceiling has never been an issue before. It should be noted that the U.S. has a few more years left before our expenditures of GNP outpace our revenue resources. Realize of course that our national debt is a major issue. If memory serves, we are roughly around 70 cents out of every dollar going toward debt, with 41 cents going toward social spending. This is nowhere near the high 90's of Spain and Italy and the 120-percent-over-revenue intake that Greece found itself in. This information comes from a recent Foreign Affairs Quarterly and "The Global Budget Race' (The Wilson Quarterly, Autumn 2010.) For those not familiar with Foreign Affairs, it goes out to a little over three-thousand individuals around the globe. All congressional offices receive one and many in the diplomatic core. This publication is a national debate on the direction of foreign policy, offering various viewpoints and is a great indicator of the direction of policy for anyone who has such an interest.

At the very least, a failure to raise the debt ceiling will result in the U.S. credit rating being lowered. This will automatically generate higher interest rates leading to another round of layoffs across the nation, as major corporations cut back in order to preserve their billion dollar quarterly profits. At the same time, small businesses scramble to simply stay afloat. This is why Wall Street is up in arms over the actions of the right-wing monster it has created. Should we avoid this situation and raise the debt ceiling, the interesting political thing to watch in the upcoming elections will be where Wall Street puts its money.

At worst and what has many Wall Street investors shaking in their over priced suits is a global economic melt down. If the U.S. credit rating is lowered, a shock wave of economic reprisals can be expected to hit the global market. Inflation at this time will more than likely sink the economies of Spain and Italy, taking down the EU. This will cause a complete to near complete collapse of the global market and end crucial deliveries of many JIT services. The result: another Great Depression.

Benefits, individuals such as the Koch brothers and their merry band of Billionaire brethren will find themselves in a position of extreme power. In fact their design of libertarianism may come to pass. Where they come sailing in and privatize most of the public services that are now offered, examples of this would be police, fire fighters, road services, etc. It would be pay as you go, where the masses would be left lacking, and walled communities would live large. I speculate by Monday, July 25, the role of being a responsible adult will be passed to President Obama, with the Tea Party republicans gaining what they were really after, a public bulletin campaign slogan for 2012.

After all America, without a means of rasing additional revenue, there is no solution to our current economic malaise. Whether that is closing offshore and onshore tax loopholes for corporations and lowering their current tax rates to match those within the EU, thereby raising revenue collected. Or raising the tax burden on the upper classes in America now, and over time raising taxes across the board as the economy rebounds. We still need to restructure our domestic, military and foreign spending.

The longer we wait, the more likely the great global engine of economic growth will come crashing to the ground.

 

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Anthony J. Gerst, is an author/columnist and activist. He resides near the confluence of the Iowa and Mississippi Rivers. His favorite author, Mark Twain, was an editor for the Muscatine Journal near where he lives. Mr. Gerst has offered musings, (more...)
 
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everyone has an opinion, opine away.... by Anthony J. Gerst on Sunday, Jul 24, 2011 at 1:51:16 AM
But some people have been so ignorant about everyt... by BFalcon on Sunday, Jul 24, 2011 at 2:33:53 PM
Printed money is loaned to the U.S. Government by ... by prsmith on Sunday, Jul 24, 2011 at 5:59:24 PM
My question was if the printed money is counted as... by BFalcon on Monday, Jul 25, 2011 at 8:20:16 AM
Every note is an instrument of debt.  Every n... by prsmith on Monday, Jul 25, 2011 at 11:16:21 AM
First, banknote originally was an instument of "de... by BFalcon on Monday, Jul 25, 2011 at 11:52:18 AM
But my arguments are accurate. . .and unfortunatel... by prsmith on Monday, Jul 25, 2011 at 2:40:34 PM
Current income to Social Security fund still excee... by BFalcon on Monday, Jul 25, 2011 at 4:43:00 PM
. . .maybe somebody else can jump in and help this... by prsmith on Monday, Jul 25, 2011 at 5:24:19 PM
And, if it is true, this is unconstitutional, sinc... by BFalcon on Tuesday, Jul 26, 2011 at 6:10:12 AM
Great analysis Anthony. The Republican grown-ups n... by Howard Schneider on Sunday, Jul 24, 2011 at 3:45:35 PM
What an incredible load of. . .... by prsmith on Sunday, Jul 24, 2011 at 5:54:16 PM
If you don't raise the debt ceiling now, we'll def... by prsmith on Sunday, Jul 24, 2011 at 6:02:43 PM
the TEA Party b.s. hasn't escaped your notice.... by John Sanchez Jr. on Sunday, Jul 24, 2011 at 10:01:18 PM
. . .is right in that we must cut spending and tha... by prsmith on Sunday, Jul 24, 2011 at 10:38:26 PM
Spending is not cut and the only spending we need ... by BFalcon on Monday, Jul 25, 2011 at 4:53:14 PM
The debt limit needs to be raised.  There is ... by Doc McCoy on Sunday, Jul 24, 2011 at 9:21:01 PM
"The debt limit needs to be raised.  There is... by prsmith on Sunday, Jul 24, 2011 at 10:47:17 PM
Few things are wrong. First, Americans don't inap... by BFalcon on Monday, Jul 25, 2011 at 5:09:00 PM
and in addition to the conditions you predicted ab... by John Sanchez Jr. on Sunday, Jul 24, 2011 at 9:57:00 PM
So what's your solution?  Our paper is just t... by prsmith on Sunday, Jul 24, 2011 at 10:44:02 PM
the validation of a TEA Party lemming who is joyou... by John Sanchez Jr. on Monday, Jul 25, 2011 at 7:35:36 AM
noted.What has been proven over the past century i... by prsmith on Monday, Jul 25, 2011 at 11:21:12 AM
Nobody wants to get out of your wallet. T.P.s and ... by BFalcon on Monday, Jul 25, 2011 at 5:15:54 PM
Hopefully we can prevent that from happening. ... by prsmith on Monday, Jul 25, 2011 at 6:33:17 PM
,you make a very valid point.  I have been ke... by Anthony J. Gerst on Monday, Jul 25, 2011 at 8:39:36 AM
What the tea party is trying to do (kill the feder... by Philip Pease on Monday, Jul 25, 2011 at 10:51:13 AM
"Solving the debt problem does need to be solved b... by prsmith on Monday, Jul 25, 2011 at 3:12:32 PM
I don't see voices for closing corporate loopholes... by BFalcon on Monday, Jul 25, 2011 at 5:21:06 PM
"Whether that is closing offshore and onshore tax ... by Anthony J. Gerst on Monday, Jul 25, 2011 at 7:53:36 PM
Of course reasonable voices like yours advocate cl... by BFalcon on Tuesday, Jul 26, 2011 at 6:16:45 AM