The GOP’s Debt Ceiling Dilemma

Debt Ceiling Dopes

The Republicans have truly painted themselves into a corner with regard to their refusal to raise the debt ceiling.  Their demand that the ceiling may only be raised along with substantial entitlement cuts but without any tax increases for the wealthy or the closing of tax loopholes for corporations, is unrealistic. Unfortunately for the GOP, the American public has seen through the charade.

CNN reports that a Quinnipiac University survey indicates that two-thirds of the public say an agreement to raise the debt limit should include tax hikes for wealthy Americans and corporations, not just spending cuts. According to the poll, almost half of voters say congressional Republicans would be mainly responsible if there’s no agreement, with 34 percent saying the Obama administration would be most at blame. By a 49 to 33 percent margin, independent voters would blame the GOP more than the administration. Additionally, a Gallup poll released Wednesday reveals that 73% of Americans believe that some sort of tax increase should be included with raising the debt ceiling. These polls indicate that the Republican Party is out of step with the majority of Americans.

The entrenched Republicans understand their unpopular position but most can do nothing to extricate themselves from it. The reason for their dilemma is that most every member of the GOP. has signed a no-tax-hike pledge. A whopping 235 House members and 41 senators, almost all of them Republicans, signed a pledge written by Americans for Tax Reform President Grover Norquist, in which they promised not to raise taxes for any reason whatsoever. Consequently, they face being called liars if they do the right thing and abide by the wishes of Americans to include increased tax revenues in a debt ceiling bill.

Republicans do not want to anger their small but radically conservative base by breaking their pledge, so their new tactic is to try to fool the American public into believing that an American credit default would not be disastrous. Everyday we hear some Tea Party backed Republican proclaim that things would pretty much carry on as normal if the nation defaults. Even Presidential candidates Ron Paul and Michele Bachmann are echoing that fallacy.

The reality however, is that a national credit default would cause untold damage to our frail economy. Interest rates would likely soar as the value of the dollar plummets. Our debt obligations would also increase drastically as the result of higher interest rates on our national debt. Our nation would also be faced with the difficult decision of deciding between paying our creditors or meeting our obligations to Social Security recipients and military families. A truly bad situation.

To put things in better perspective, the aptly-named Perspectives.com offers this wonderful list of “The 10 Things The GOP Does Not Want You To Know About The Debt“:

  1. Republican Leaders Agree U.S. Default Would Be a “Financial Disaster”
  2. Ronald Reagan Tripled the National Debt
  3. George W. Bush Doubled the National Debt
  4. Republicans Voted Seven Times to Raise Debt Ceiling for President Bush
  5. Federal Taxes Are Now at a 60 Year Low
  6. Bush Tax Cuts Didn’t Pay for Themselves or Spur “Job Creators”
  7. Ryan Budget Delivers Another Tax Cut Windfall for Wealthy
  8. Ryan Budget Will Require Raising Debt Ceiling – Repeatedly
  9. Tax Cuts Drive the Next Decade of Debt
  10. $3 Trillion Tab for Unfunded Wars Remains Unpaid

Sometimes the facts and the truth can prove to be painful. In this case they are truly painful to the Republican Party.

Please remember to click on the song link below to familiarize yourselves with the tune and to have more fun singing along with today’s very topical song parody.

Welcome To My Nightmare song link: http://www.youtube.com/watch?v=IKpEoRlcHfA

WELCOME TO MY NIGHTMARE

(sung to the Alice Cooper song “Welcome To My Nightmare”)

Welcome to my nightmare
You ain’t seen nothin’ like it
I think you’re gonna feel
Something’s wrong

A cerebral vacation
Republicans need sedation
Their mouths will be filled with foam
Before too long

Welcome to my nightmare, ohh

Welcome to my breakdown
Does Eric Cantor scare you?
That’s just the way they are
In Red State towns

They sweat and laugh and scream there
Mann Coulter’s their wet dream there
He really makes them feel
Right at home, there

Welcome to my breakdown, ohh
You’re welcome to my nightmare, yeah

(hypocrisy break)

Welcome to my nightmare
You know I just don’t like it
G.O.P. makes me feel
I don’t belong

They lie and shout and scream there
And Palin is their queen there
They all giggle and squeal
At her throne, there

Welcome to my nightmare, ohh
Welcome to my breakdown
Yeah!

(great instrumental fade out)

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Posted on July 15, 2011, in Republican and tagged , , , , , , , , , , , , , . Bookmark the permalink. 11 Comments.

  1. http://www.huffingtonpost.com/blackberry/p.html?id=899561

    Evangelical nut jobs have bee ruining this country for a while.

  2. Hate to break it to you, but take it from a finance professional that raising taxes will not solve our problems. Liberals tend to think that throwing more money at the problem will help (it doesn’t). In fact, you raising taxes will probably have the reverse effect on the economy and inevitably a further decrease in jobs – which should be our number one concern.

    To TRY and be somewhat moderate in my view, perhaps a SLIGHT increase in taxes could be implemented, but it would have to be for EVERYONE. Just because I’m smart and busted my ass to get to where I am does not mean I need to pay for Joe Schmoe sitting on his porch sipping on his 40 collecting his unemployment benefits with all the other BS social programs in place that spend my hard earned tax payer dollars. Oh, did I mention I’m just about to take on $75,000 of debt for my MBA? There’s a reason I don’t want my taxes risen and I think it makes perfect sense. Suck it, life’s hard. Raise taxes? Sure, a tad with the understanding that austerity measures will be implemented. It’s a give and take relationship.

    Rest assured that the debt ceiling WILL BE raised. If the GOP and the Liberals can’t get to work on this together, everyone suffers. We are on watch for a credit downgrade from the rating agencies – this does not bode well for the credit markets and could cause a spike in yields crushing lending and business funding. If we don’t get our ass in gear (GOP and Liberals) we are in for a rude awakening. We have a gun to our head and we MUST raise the debt ceiling, but not without severe changes in our SPENDING.

    • Most every economist disagrees with you. They acknowledge that the deficit cannot be reduced significantly by entitlement reductions alone. Tax increases are also required. Tax increases on those making over $ 250,000.00 are also fair because it means that those persons who have profited most from the Bush tax cuts will also have some skin in the game (along with those less fortunate folks who will suffer a loss in their entitlements). In other words, both the wealthy and the disadvantaged will share in the burden of reducing the deficit. Additionally there is a moral argument for closing tax loopholes because, by their very nature, these loopholes were not intended to exist in the first place. That is why they are referred to as “loopholes”.

      The idea that raising taxes on the wealthy will decrease jobs is a proven myth. When taxes were raised under Clinton, job growth boomed. When taxes were cut under Bush job growth came to a screeching halt and was at its lowest level in modern history. Presently, corporate coffers are overflowing with profits and still these corps have chosen to ihire overseas and not in the US. Hence, more corporate wealth does not lead to more domestic job creation. Furthermore, any and all tax increases sought by the Obama administration are not going to take effect until 2013 so there will be no adverse effect on today’s corporate wallets during this downturn in the economy.

      BTW, I too am smart and busted my ass to get where I am. I am not saddled with student loans however, because my father was also smart and busted his ass so that my education was paid for with our own money and not loan money made available by those programs which you would now like to cut. Without those student loan programs you would not be able to ‘take on $75,000 of debt for my MBA”.

  3. Lucky for you. I come from a family where everyone is a physician and they still can’t afford to pay for my post-graduate education. They were able to help with undergrad, but post-graduate, forget about it. You are more blessed than I if your family was able to provide for you undergraduate and post-graduate education on their bank roll. I’ve been independent since I graduated college.

    “The idea that raising taxes on the wealthy will decrease jobs is a proven myth. When taxes were raised under Clinton, job growth boomed.” The situation we find ourselves today is gravely different than the situation under Clinton. You can’t equate the two. Also, by no means am I suggesting that one party has the solution. I think they need to work together for a middle ground solution.

    Yes, cut the programs. 😉

  4. Oh and raising taxes on the wealthy will decrease jobs. My dad has and will slash again as health-care and taxes continue to eat at his income. He’s already fired 5 employees ranging from physician assistants to secretaries.

  5. Again, I question why you are willing to take advantage of low interest govt. student loans yet are willing to deny govt. resources to others who have different needs than you.

    If your father is cutting jobs because of taxes and health care premiums then he can blame someone other than the Democrats. Taxes are at their lowest levels in 60 years and Obama has only cut taxes (payroll withholding) and not raised a single tax since he was elected. Your father’s situation proves my point. If taxes are at their lowest in 60 years and he is laying off workers, I question whether he was laying off workers prior to the Bush tax cuts from which he has been profiting since 2003. The Bush tax cuts do not seem to have spurred your father to increase hiring.

    The reason for the new health care law was to not only insure more Americans, but also to slow down the ever increasing rise in premiums resulting from our present dysfunctional health care system. The dramatic increase in your father’s health care premiums are a consequence of that old system. The new health care law’s insurance exchanges for small businesses will not begin to be implemented until 2014 and will not be fully implemented until 2014. At that time, it is expected that the rise in health care premiums will slow down. They will still rise but at a slower rate than under the present system which is crippling your father.

  6. I suppose my father doesn’t know what he is talking about when it comes to health care then.

    I never suggested that the Bush tax cuts have spurred growth either.

    • I do not pretend to know what your father knows, but it is a fact that his rising health insurance premiums have nothing to do with the new health care law inasmuch as its premium-affecting provisions are not yet in effect. Also, your father’s tax problems can have nothing to do with Obama or the Democrats inasmuch as he has only cut taxes.

      You may not have said that tax cuts spur growth, yet you did say that increasing taxes will diminish job creation and that has not been historically correct. Furthermore, since corporations are now hoarding more cash than at any other time since before the great depression, they should not be adversely affected by a slight tax increase as the result of closing unintended loopholes. They will still have plenty of cash to go on hiring cheap labor overseas.

  7. Palace Coup

    Corporations are flush with cash but aren’t “hiring” because there’s not enough demand in the economy, and there won’t be any increased demand as long as Cantor is more concerned with ousting Boehner (and President Obama) than with governing.

    Teabaggers seem to understand that we shouldn’t increase taxes in a recession but seem completely flummoxed by the notion that cutting spending is no wiser. Eisenhower and Nixon would be shocked by today’s numbskull GOP teatards. How the rest of the world must be laughing at us!

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