The Worried Dollar by N.A. The Worried Dollar by N.A.
just listened closely to the President's speech
on CNBC on the continuing
shutdown and the fast-approaching debt ceiling.
He squarely believes
the Republicans are holding the country hostage, and they are. Of
course, this doesn't mean he is off the hook, since there are a number
of things he can do, not only enumerated in articles like mine
, written last January, when we went through this last time, and which cites
economists and constitutional scholars, but also more recently the
suggestions that he simply ignore the debt ceiling on constitutional
(it's maddening, to me at least, that only the 14th Amendment is
cited and not also the equally precedent-setting Article 6: "All
Debts contracted and Engagements entered into, before the Adoption
of this Constitution, shall be as valid against the United States under
this Constitution, as under the Confederation." Clearly, the founders -
most of them big bond holders - intended for the government to pay its debts, always
and completely. It was, argues Woody Holton in "Unruly Americans and the Origins of the constitution
" one of the main founding principals, and was passed even before the Bill of Rights!)
The president is in violation of the Constitution NOW, by partially
funding some programs and not others, in
clear violation of the previous authorizations of Congress. He has the tools to
end the debt crisis but chooses not to use them. Recently, the inside-the-beltway reporter John
Harwood directly sat down with the President and asked him about the
option to simply ignore the debt ceiling and Obama waved it off and
didn't want to discuss it. His office has maintained that it won't use
that option, but I believe that ultimately, it will. This will take the
Republicans off the hook, and give them grounds to try and impeach him,
which the Democratic-led Senate will waste several months, to ultimately
Of course, this is a horrible way to
run the government, but the Tea Party Republicans do not care. A
switch to debt-free money, which ought to have been done long ago,
during the credit crisis in 2008-09, is the only way to really end the
ever-growing debt crisis, but this seems to be off the radar for the
idea-insulated Administration (once Dennis Kucinich left Congress, it wasn't even
part of a bill anymore. Kucinich's HR2990
would have switched ALL money to United States Notes, directly issued by Congress via a Monetary Authority created for that purpose).
argument about funding the National Institute of Health, or providing
food stamps to hungry children, or even keeping the national parks open, will dissuade them. They are absolutely
convinced that most of what government does is either unnecessary, or
can be done better by the private sector - including charity (there is
even slight evidence they practice what they preach, since Republicans,
as a group, give slightly more to charity than Democrats, often through
Of course, they also believe all regulations
suppress thousands of businesses that would
otherwise spring up and provide jobs for the unemployed, despite overwhelming evidence that lack of regulation provides a criminogenic environment
that encourages rent-seeking and destabilizing fraud and speculation. They're not
particularly concerned about the government's debt rating being
downgraded, because they don't want government borrowing in the first
place, so making that harder does not bother them.
John Boehner has the votes to override the unrepresentative Tea Party faction, but chooses not to put the budget to the floor for a vote, so fearful is he of losing his speaker-ship to a Tea Party upstart like Ted Cruz, or even being "primaried" out of office.
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So, who will blink first? Is Obama just setting us up for a Grand Betrayal - what he calls a Grand Bargain - where he slashes all kinds of social programs in exchange for the extortionate Republicans releasing the American People as economic hostages?
I don't know, but it makes great Kabuki Theater.
Scott Baker is a Managing Editor & The Economics Editor at Opednews, and a blogger for Huffington Post, Daily Kos, and Global Economic Intersection.
His anthology of updated Opednews articles "America is Not Broke" was published by Tayen Lane Publishing (March, 2015) and may be found here:
Scott is a former President of Common Ground-NYC (http://commongroundnyc.org/), a Geoist/Georgist activist group. He has written dozens of articles for (more...)