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October 3, 2013

The Debt Ceiling Kabuki Theater Plays on

By Scott Baker

I just listened closely to the President's speech on CNBC on the continuing shutdown and the fast-approaching debt ceiling. 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.

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The Worried Dollar
The Worried Dollar
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The Worried Dollar by N.A.
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I 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 grounds (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 defeat.

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).

There is a faction of Republicans which WANTS to shut down the government.  This, by itself, is a goal, and they have said so repeatedly.  See Rachel Madow explain this here: http://www.huffingtonpost.com/2013/10/01/rachel-maddow-shutdown-republicans_n_4021809.html

No 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 religious organizations). 

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.

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.


Authors Website: http://newthinking.blogspot.com/

Authors Bio:

Scott Baker is a Managing Editor & The Economics Editor at Opednews, and a former 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:

http://www.americaisnotbroke.net/

Scott is a former and current President of Common Ground-NY (http://commongroundnyc.org/), a Geoist/Georgist activist group. He has written dozens of articles for Common Ground's national publication, GroundSwell, and has advocated for the Georgist Land Value Tax to public and political audiences.

A complete list of his publications can be found here:

Click Here



He is also New York State Coordinator and Senior Advisor for the Public Banking Institute

Click Here, which seeks to promote Public Banking. The PBI is chaired by another OEN blogger, Ellen Brown.
Scott has appeared on TV/Radio and in in-person Presentations to explain the principles of Georgism, Greenbacking, and State Banking. These may also be found on his personal blog: http://newthinking.blogspot.com/


Scott has a dozen progressive petitions on Change.org which may be found here:

http://chn.ge/10nUAmJ

Scott was an I.T. Manager for a major New York university for over two decades where he earned a Certificate for Frontline Leadership.


He had a video game published in Compute! Magazine: Click Here

Scott is a graduate and adjunct faculty of the Henry George School of Social Science in New York City.


Scott is a modern-day Renaissance Man with interests in economics, science and all future-forward topics.

He has been called an "adept syncretist" by Kirkus Discoveries for his novel, NeitherWorld - a two-volume opus blending Native American myth, archaeological detail, government conspiracy, with a sci-fi flair http://amzn.to/10nUoDV


Scott grew up in New York City and Pennsylvania. He graduated with honors and a Bachelor's degree in Psychology from Pennsylvania State University and was a member of the Psychology honor society PSI CHI.

Today he is an avid bicyclist and ride co-leader in a prominent bike advocacy organization.

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