Who wants to see the US default?

[Ronstang]

I'm not sure if everyone that discusses this issue is dumb or lying but there is NO chance of a default. There is more than enough income every month to service the debt. If the debt limit does not get raised all it means is the idiot Democrats will have to choose which of their constituents don't get their free stuff or have their government position furloughed or done away with. This is all about decreasing the amount of discretionary spending and always has been. It is simply politically expedient to frame it in a way that scares people into agreeing with you fucking them in the ass willingly.

 

[sandorski]

Default or not, this issue is the biggest spook on the Private Sector. Who will Invest or Spend when a new Recession could hit in a couple weeks?

Where are all those "Stability" Republicans?

 

[lord_emperor]

I want to see the army of welfare recipients and pensioners who rise up and ransack wall street offices.

 

[Dulanic]

The tea party does, that who.

http://thinkprogress.org/economy/2011/07/27/280754/boehner-gop-want-chaos-debt-ceiling/

 

[Spikesoldier]

I want to see the army of welfare recipients and pensioners who rise up and ransack wall street offices.

yep it will be bonus army all over again. only laughable thing is that they actually earned their bonuses they were rioting about.

 

[glenn1]

Wouldn't mind a government shutdown. Gives some people a taste of what the small government they are supporting looks like.

Texas has comparatively few government services, and people are flocking there. Seems to be a bigger market for it than you might imagine, just as there seem to be plenty of folks moving to highly progressive areas of the country. People allowed to vote with their feet are already sorting themselves into enclaves of similar minded folks.

 

[Engineer]

The tea party does, that who.

http://thinkprogress.org/economy/2011/07/27/280754/boehner-gop-want-chaos-debt-ceiling/

Especially those that want to "lower the debt ceiling".

 

[badb0y]

I don't want to see a default because I live here.

 

[sandorski]

Especially those that want to "lower the debt ceiling".

Might as well lower it to $0. lol, gotta give him cred though, that's definitely outside of the box thinking.

 

[theeedude]

Default sounds like it would do permanent damage, but a temporary partial government shutdown to teach the small government crowd a lesson, let's go.

 

[UberNeuman]

 

[Fear No Evil]

Default sounds like it would do permanent damage, but a temporary partial government shutdown to teach the small government crowd a lesson, let's go.

Ok.. so how do we pay for your big government? Where do you get 1.5 trillion from?

 

[QuantumPion]

That's cute if you think that the "world" is comprised entirely of the US federal government bureaucracy. Actually at the rate Obama is spending money it soon will be. So nevermind, you're good.

 

[JockoJohnson]

Default sounds like it would do permanent damage, but a temporary partial government shutdown to teach the small government crowd a lesson, let's go.

That's the second time you said that in this thread. To quote from one of the greatest movies of all time, "I do not think it means what you think it means".

 

[wuliheron]

Some 70% of the country is now upset with the republican party and the tea baggers. If the country defaults it means its lynching time and at the very least the republican party will have to reinvent itself. If we don't default it means the tea party looses credibility, has spent its wadd, and is on its way to obscurity. Either way the end result is the same.

 

[theeedude]

Ok.. so how do we pay for your big government? Where do you get 1.5 trillion from?

Republicans will find it in a hurry once the public gets a taste of small government and balanced budgets in the middle of a recession.

 

[Fern]

I agree, I don't think the government will default, but the credit rating will still get downgraded.

-snip-
We don't have to technically default to have our bond rating downgraded and face the consequences of that. Anyone who thinks we are not facing a very serious possible crisis in the near term from this mess is sticking his head in the sand.

I think a downgrade is inevitable.

Hence, I think the far more interesting question is how will that affect our interest rate in the near term. I'm not yet persuaded it will have the immediate price increase many assume. Is there really any safer place to invest? At this point I think not. Moreover, the US fed gov financials are known by all, unlike other companies thus requiring investors to rely upon the ratings agencies.

We'll see.

Fern

 

[Fern]

has any credible constitutional scholar written an opinion whereby the president can unilaterally order treasury to break the debt limit using the 14th amendment as a backstop? last i'd heard obama didn't consider that a good legal argument.

Hypothetically, I think he could. I say hypothetically because we're not in a position to default, we are in a position (eventually when accounting tricks run out) forcing deep cuts, but that's another matter.

The Constitution seems quite clear to me - no default. So, in my uneducated opinion (I haven't really researched this to any degree) one way or another bonds and interest must be paid off.

Fern

 

[Fern]

Just let the Bush Tax cuts expire. Extend payroll tax holiday to offset middle class impact.

Lately our annual deficit has been in excess of $1 trillion. The Bush tax cuts amount to only about $100 billion, no where near enough to prevent huge additions to our national debt.

The payroll tax holiday is a pittance. IMO, since it's SS and has nothing to do with our annual budget deficit and national debt it's nothing than theft by the fed gov of SS funds.

Fern

 

[Fern]

This is an unnecessary crisis brought on by the new Know Nothing Teabaggers forcing the debt limit to be linked with fixing the budget. They are distinctily two different legislative functions.
-snip-

Umm, no.

The debt limit and the budget are directly and inextricably linked.

Fern

 

[theeedude]

Lately our annual deficit has been in excess of $1 trillion. The Bush tax cuts amount to only about $100 billion, no where near enough to prevent huge additions to our national debt.

The payroll tax holiday is a pittance. IMO, since it's SS and has nothing to do with our annual budget deficit and national debt it's nothing than theft by the fed gov of SS funds.

Fern

$100B? Try $400B.

 

[soulcougher73]

I want it to default just for the wake up call effect. Maybe then and only then will people get their shit together.

 

[SickBeast]

All of this nonsense about the debt ceiling and spending cuts is hogwash.

Simply do the following:

1. Stop blowing up other countries

2. Sell military hardware to other countries

3. Develop a militia and keep all current soldiers on reserve

4. Invest in infrastructure and health care

5. Enjoy your lives and your new found wealth

6. Give China some of the gold being held as collateral against the debt as a gift of gratitude for all of their hard work and ingenuity

 

[Fern]

$100B? Try $400B.

Well, I've googling this for some time now. I've seen it as low as $98 billion per year, got it from a CBO study which I cannot find today. I've seen it as high as $500 bil per year from various authors, but they're adding other costs based on their assumptions etc.

Edit: The lower amount of $98 billion may well come from a later CBO report. The one I linked below reflecting an amount of $180 billion per year was prepared in June of 2007, well before the recession hit. Clearly the recession, having lower income, would reflect a lower cost of those tax cuts.

Today, the amount of about $180 billion year looks to be the most solid I can find:

The Congressional Budget Office (CBO) has estimated that extending the 2001 and 2003 tax cuts (which are scheduled to expire in 2010) would cost the U.S. Treasury nearly $1.8 trillion in the following decade, dramatically increasing federal deficits.

http://en.wikipedia.org/wiki/Economic_policy_of_the_George_W._Bush_administration

The numbers quoted come from a CBO report, see page 6, Table 1-3 :

http://www.cbo.gov/ftpdocs/78xx/doc7878/03-21-PresidentsBudget.pdf

Fern

 

[Craig234]

I think a downgrade is inevitable.

Something I haven't seen discussed is the idea that credit ratings agencies want to downgrade the US anyway for other reasons than the ceiling, like the ongoing issues with debt and problems with the US economy, but it's politically very hard to do, and this is a great chance to use this issue as a reason to do it.

Another is that this will start a cycle - as huge amounts are removed from the economy causing further problems, those problems can cause more problems, and they'll cause more.

But we'll still have the fun of being able to point and laugh at the tea partiers who said 'it'll be fine', just as we can point and laugh at the people who dismissed the Great Depression.