Does President Obama’s have a secret weapon to force Republicans to come to the table?
A group of 248 economist, six of whom are Nobel Prize winners, sent a letter to Congressional leaders yesterday demanding a clean vote to raise the debt-ceiling – arguing that failure to do so could have, “a substantial negative impact on economic growth.” The IMF issued a similar warning too. But as President Obama drew a line in the sand yesterday in debt-limit negotiations demanding that tax loopholes for millionaires, billionaires, and transnational corporations be closed – and Republicans drew a line in the sand on behalf of those tax loopholes – a debt-limit deal looks more and more unlikely. And as Secretary of the Treasury Tim Geithner’s debt-deadline of August 2nd draws closer – some are looking at what a post-August 2nd America looks like if the debt-limit is not raised – and it’s not pretty.
While the United States may not actually default on it’s debts – it WILL have to cut off many day-to-day payments to critical programs around the country and prioritize its debts. On August 3rd – the day after the deadline – our nation will owe $32 billion – but will only have about $12 billion in revenue to pay up. That means about $20 billion will need to be cut out immediately – in just one day. But here’s the thing – figuring out which bills get paid and which ones get pushed off – is solely up to Treasury Secretary Tim Geithner and President Obama. So if the Republicans REALLY want to play hardball on the debt-limit – then President Obama should hold them accountable and put their states on the chopping block first.
That could mean cutting off critical transportation and other federal assistance funds – and even Social Security payments – to red states represented entirely by obstructionist Republicans. While this isn’t an ideal situation – it is President Obama’s secret weapon to force Republicans to come to the table and compromise. Once folks in Eric Cantor’s Virginia district see their Social Security payments cut off – you can bet Cantor’s office will be flooded with calls from constituents demanding he raise the damn debt ceiling.
Let’s put the real consequences of their obstructionism in their face – and watch the Republicans blink.
Just curious; if the debt ceiling is always raised, why even bother with a ceiling?
Seems to me to just be another distraction to keep the population divided; democrat vs republican, liberal vs conservative... thus we don't concentrate on who is really doing the oppression.
Very good points!!! But if Obama walks the walk instead of just talking the talk, on this, instead of "compromising" everything away then I might even be tempted to think he is not all that bad and that he might even be on our side (for a change) instead of giving everything away to our enemies. If he shows that he is not such a pushover then that is "throwing us a bone". I'd bet that Obama's ratings would shoot right up (in the Blue States, but probably not in the Red states...at least he might revitalize his base to at least vote for him again instead of sitting this one out).
If Obama does this then it will help to show that voting just might matter....and that if you are a red state then you will have to suffer the consequences (for a change). But I will feel sorry for those Democrats who depend on the social programs who are unfortunate to live in those Red states. But I would gloat and laugh at those who voted Republican.
And since.....as Michael Hudson, the economist, points out...."if the Treasury and Federal Reserve can create $13 trillion of public obligations – money – electronically on computer keyboards, there really is no Social Security problem at all, no Medicare shortfall, no inability of the American government to rebuild the nation’s infrastructure.
The bailout of Wall Street showed how central banks can create money..."
So screw the debt ceiling....it is just as mythical or nonsensical as the "flying spaghetti monster". Just another gimick to confuse everyone.
Thom, you had a conversation on your program with a person who discussed the elimination of minimum wages. You are knowledgeable in many areas and on many issues but PLEASE have your talking points typed in advance. These talking points may be used with other conservatives. If we are going to do away with minimum wages, we will need more safety nets in health care, social justice programs, and social security. We would also need for the rich and our transnational corporations to have Guarantor Responsibility in many goods and services areas. We would need to scale back profiteering in these goods and services areas. A $40,000 car would sell for $2,000 is an example. PLEASE keep your talking points sheets available upon quick referral necessity for rebuttals.
Here is another concern. When I was growing up, I was taught to trust the police and the FBI laboratories. Today, I do not trust the police and the findings of the FBI laboratories. In our current police culture I do not trust any law enforcement official. Blue collar crimes go to jail and white collar crimes are praised and rewarded, such as the criminal and immoral behavior of our banksters and the Wall Street crooks and robbers.
When I read the comments on Thom's blog, the people have great thoughts on why we have a problem. But, we need more comments on the how and what you would do to resolve the problems facing our country and the world.
President Obama doesn’t use the Bully Pulpit as well as Pres. W. did during his time in office. Bush would be flooding the media with a constant flow of administration officials stating his case. Another thing Obama administration doesn’t have that W. had is a cast of characters. Cheney, Rice, Rumsfeld, Rove and other administration officials seem to have as much weight with the media as the president during Bush administration.
Deliberately or not the Republicans have Obama on an island. He needs other administration officials with clout trumpeting to the court of public opinion. The republicans need to be forced to defend and explain their positions. Obama doesn’t do well at getting his message out and hammering it home. The Bush administration did have the advantage of the collective voice of the republican media machine.
President Obama must use every resource at his disposal to make his case to the public and put republicans on the defensive. The republican have own the narrative for the past 16 years starting with the second term of the Clinton Administration. The President and Democratic politicians have to become more aggressive and assertive in their case building against the Republican Party’s agenda. The support of the public is out there, the Democrats just need to find the political courage to follow their conviction if their serious about saving our economy and preserving a functional democracy.
This has become a very scary time in America. I fear the economic agenda of the Republican Party. This country could become something worse than fascist a hybrid of fascism/multi-national corporate controlling every government and financial institution in our country. The Supreme Court the most powerful ruling body in the country is under corporate control. The wealthy have the entire Republican Political machine acting as their proxy. Right now as America stands it will just be a matter of time before they destroy America’s social safety net and social justice will just be another America dream crushed by the agenda of the powerful and wealthy.
I certainly hope that the first thing to be cut off would be all money for the Senate and House including pay and benefits for senators and congressmen and for all their aids and percs. The Gyms and cafeterias should be closed and all security pulled. Wouldn't hurt if the lights were shut off too.
If it is in fact Obama's ace in the hole, he won't play it. He's had plenty of chances to use leverage against the Republicans, and he has yet to do so, even when 80% of Americans are behind him. He was a corporatist in the Senate, and that didn't change when he became president.
I think this will be a planned implosion to foster in the second dip - which will be much worse than the first - designed to usher in a new global feudalism. Do you get the idea I'm not very hopeful?
A corrupt, politically driven government that spends more than it brings in and has done so for years is disgraceful. These politicians are owned and operated by special interest and if we do not hold them accountable with real consequences, we are fools and deserve what we get. They created one big crap sandwich and now we all have to take a bite.
@Paul Velleman, thank you for a succinct comment what we need to do as Americans in resolving some of our politicians lavish lifestyles that have a negative impact on our citizens wellbeing!!!
This is an excellent idea for day two after the failure to raise the debt ceiling. First should be the targeting of so-called "red states" and then go for the juglar: those federal welfare programs for industry and the wealthy.
@mmetti, thank you for your thoughful words!!!
Great idea Cut off the red states. Thats only fair.since they are the loyal followers who gave us these greed lying Repubs. GOP ran on jobs but have done zero .All they do is stamp their feet - storm out of meetings & demand even more corp tax cuts - OIL subsides and giant loopholes while our kids education, the old on medicaid - disabled, Students all do without . Heaven forbid Corps lose some of their perks GOP WILL NOT ALLOW THAT .GOP chose corps / billionaires over all else !! Just wait till seniors start hollaring about their checks Repubs - COns / Baggers still love their gov't programs like ... Medicare
The GOP wants to crash the economy in order to make Obama look bad. They don't care what it takes to get him out.
palindrom....You are ignorant of these facts GOP raised debt ceiling 10 and 15 times under Reagan and Bush
US has never refused to raise debt ceiling NOT once
@lhebbard, here is a thought. I look upon going for the jugular with operant conditioning. Please keep attacking the jugular with constant ideas and thoughts in order to condition the conservatives with the fact that they have stinking thinking. Operant conditioning may eventually sink for the progressives to stand up for something. It may not change the conservative crazies' thought processes but the ideas and thoughts of patriotic Americans will help them to feel better in trying to resovle our many problems.
Any Representative or Senator who voted against raising the debt ceiling should be told that "their will be done" and as it was their wish, they will be credited with the honor of being first on the list to balance the budget with cuts to their pay and allowing them to contribute to their medical plans and pensions. This will be followed by the first cuts in assistance being in their states.
Oh if the President only had the guts to propose this, we'd see how quickly the Republican tune would change.
Paul: I second that....especially their cozy health care. Let them know how it feels to go without it like many of us have to.
Aside from the topic at hand....has anyone been paying attention to the Omaha nuke plant? I just checked the weather reports for the whole area that feeds the Missouri (N. and S. Dakotas, Minnesota, and Nebraska) and the whole area is forecast for more thunderstorms. They are also undergoing very high temperatures...one weather report I read for Kansas City, Mo was that it was 105.9 degrees with a feels like temperature of 108 degrees. With the typical high humidity and high temperatures...and major flooding...I sure wouldn't want to be without a nice air conditioner and mosquito spray. It might pay to buy a geiger counter and some lead suits as well...and don't drink the water..if you live in Omaha or anyplace south along the Missouri....or downwind. We may very well be having our own Fukishima meltdown soon.
@my response to number 7 and number 15, please keep going for the jugular by revealing how unpatriotic our conservative crazies are.
Whenever I can, I let my conservative relatives know their thoughts are crazy and they need to check into a mental institution for a 72 hour assessment of just how crazy they are!!!
I probably upset them but we are playing for high stakes in our nutty country!!!
Dianhow: No, I am not ignorant of the fact that the GOP has raised the debt ceiling many times...I know that...why do you think I don't know that....did I say something that would indicate that? In fact, I was going to mention that myself but just didn't. I agree that it is very important for everyone to know just how ridiculous and hypocritical it is of the Republican'ts to hold out on raising the debt ceiling now when they did themselves so many times while they were wasting scads of money and committing war crimes. I'm just saying that it seems like the debt ceiling (limit) is just a distraction and a tool that the Republicans are trying to use to deprive us out of our social security and other social services. This is what the Republicans have wanted all along and now they are pretending that the debt limit is so important that we can't raise it again...this time for the people...rather than for the rich war criminals who murder people for profit.
My wife made a comment today and she informed me that she is voting for Obama if for no other reason, then to have him be able to select a more progressive justice on the Supreme Court.
There are people who believe the debt ceiling is unconstitutional. Congress would not be one of those people.
David Lynch : If it is in fact Obama's ace in the hole, he won't play it. He's had plenty of chances to use leverage against the Republicans, and he has yet to do so, even when 80% of Americans are behind him. He was a corporatist in the Senate, and that didn't change when he became president.
On the other hand, Geithner is getting ready to exit. While he's still SecTreasury; Obama can simply refer the payment schedules to him. Congress already hates Geithner, so no big deal.
If the Republicans want the country to default, then THEIR supporters can shoulder the burden manfully, like the war heroes they make themselves out to be.
According to the CRS (Congressional Research Service) Report for Congress-Prepared for Member and Committees of Congress dated Jan. 28, 2010 and entitled: The Debt Limit: History and Recent Increases:
"Congress has raised the debt limit eight times since 2001."
From an article written by Bruce Bartlett in the Financial Times on Oct 22, 2009:
"Since the debt limit is “must pass” legislation, it often becomes a vehicle for extraneous measures that would be vetoed by the president if presented to him as a stand-alone bill. More importantly, it is always an opportunity for the party not in power to stir up debate about debt.
“The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure,” then-Senator Barack Obama thundered on March 16, 2006. “Increasing America’s debt weakens us domestically and internationally. Leadership means that ‘the buck stops here’. Instead, Washington is shifting the burden of bad choices today on to the backs of our children and grandchildren.”
Mr Obama voted against raising the debt limit that day and will, no doubt, be reminded of this fact by Republicans in coming weeks. (or years...my comments)But everyone knows the debt limit will be increased after Republicans extract their pound of flesh by making the administration – and financial markets – sweat a bit.
It is possible that the debt limit may be breached temporarily if Congress does not act in a timely manner. The Treasury can temporarily delay buying new bonds by using social security’s excess cash but Republicans will scream that the social security trust fund is being raided. However, in 2002 a Republican administration engaged in a similar manoeuvre.
There may once have been value in forcing Congress to occasionally focus on the debt and think about its implications before raising the debt limit. But in 1974, it enacted a budget law that forces it to deal with the budget as a whole on a yearly basis, rather than limiting its attention to individual appropriations bills. Since then the limit has been superfluous."
gerald: I may end up voting for Obama just because I hate Republicans so much...not that I think Obama is much different than Republicans. If Bernie Sanders were running or even if Thom Hartmann were running I'd vote for them instead. How about it, Thom, are you up for being our next President?
The POTUS will cave, just as he always does!
In August 2009, Bruce Bartlett wrote a piece for the Daily Beast in which he attributed the recession of 2009 to George Bush and Republicans, whose policies he claimed resulted in an inferior record of economic performance to those of President Clinton.
In Bartlett's latest book, The New American Economy: The Failure of Reaganomics and a New Way Forward, he embraces Keynesian ideas, stating that while supply-side economics was appropriate for the 1970s and 1980s, supply side arguments do not fit contemporary conditions.
So, let's see....if we default on the debt (don't raise the debt ceiling) Tim Geithner warns that taxes will go up on everyone.....that interest rates will go up....so like, I'm sure he really is worried about taxes going up on the little people...he is really worried that the rich will have to pay their fair share....like, the rich people will no longer be able to borrow huge sums at rock bottom interest rates and continue to buy up foreign currencies and assets making a killing in profits. Do you really think the Republicans are going to let this happen? Stay in there Obama! The Republicans are idiots!
Me?..I'm burning all my credit cards and taking my money out of the bank...we don't need no stinking credit or overlord to guard our money...who will eventually find a way to screw us out of it anyway!!..the banks are very likely to be robbed anyway because they are laying off most of the police....the way things are going, the FDIC won't be able to make good on any of the many bank failures that are likely to happen. But, of course, they could just print up more money (correction, they don't really have to "print" more money now-a-days...they just create it on the keyboards like they did when they bailed out the criminal banksters...there was no talk of debt ceilings then, was there?) and pay off everyone with little pieces of paper called cashiers checks...good luck getting them cashed.
The strategy of hitting red states, military contractors, etc., is the kind of hardball Republicans understand. And it would be about time! Give them a taste of their own medicine.
I would like to know if Republican members of Congress, or other members of Congress currently holding the nation hostage are holding large amounts of foreign currency or gold or some hedge for themselves against the dollar falling and not being the international standard currency. How can they possibly be voting to default unless they themselves stand to benefit, not just politically but financially? Or are their sponsors holding positions in other currencies? Transparency about this could clear up a few questions of the "are they crazy?" sort.
If there has ever been a bucket of cold water for a politically asleep populace, by god the debt ceiling issue is it. This is President Obama's pivotal moment, he must stand firm and not back down. Putting the red states on the chopping block first is a fantastic idea. Not only would this hold the REPUBLICAN hostage takers accountable, it would also make it very difficult for the right wing mass media to spin it away from those who are trying to carry out the economic terrorism. The general public will have to finally take notice of the two options the REPUBLICANS are offering, global depression or severe domestic cuts which would greatly increase unemployment and totally crap out our economy. Last I knew the Democrats wanted the same thing the vast majority wants, tax cuts for the super rich eliminated......not the Waterloo old Mitchey boy was hoping for!
I also think the public option could have been handled in a similar fashion, during the health insurance reform debates. The blue states that wanted the option should have got it while the red states went right along dumping multi millions on amateur golfers...I mean health insurance company CEO's.
We need to win the language war:
Choice of words determines how messages are received. People have tax deductions. People like their deductions. Thus arguing to take away some corporate" tax deductions" is not a strong argument.
Please call them what they are. They are GIFTS from our treasury to selected corporations.
If we frame the argument in terms of "eliminating corporate tax gifts" we will have stronger support for what needs to be done. And people will finally begin to see the gifts for what they really are.
Well, Thom, to quote you, I hope that Obama grows a pair, and tells the republicans what's going to happen to them, and I hope he tells Geithner that if he doesn't want to play ball with progressives and democrats,he can find another job.
We know that the legendary five Supreme Court justices are running this country but the question is, “Are these five justices also ruining this country???"
Highly recommended to watch Cenk Uygur on the june 30 youtube video. He says it all..well, most of it.
MSNBC/The Young Turks host Cenk Uygur addresses the people who despise the fact that he's critical of President Barack Obama.
Thanks for providing that insight Thom. We have to collectively encourage the President to not back down on this. It is encouraging to hear that he has the power to turn the tables on them. What they are doing across the country right now is criminal behavior. These republican politicians deserve to be thrown in jail for neglecting the basic human rights of the lower in middle classes in favor of preserving their phony elitist agenda.
I am no expert but I think we need to be realistic about our expectations. This situation is provoking a lot of people to actually care about politics for a change. It is going to radically reduce voter apathy because basic human needs are being threatened on such a large scale. Coupled with the development of many "people movements" being formed this is an opportunity in the coming years for "we the people" to gain an unprecedented amount of political power. The republicans are causing a great deal of suffering but if this process serves to rally the troops out of their general apathy than it is a blessing in disguise. We should not overreact to the rep's manipulation of our economy. It is actually serving to build the power of the people for the next elections and for the next generation.
I don't know if many of you know about moveon.org but it is essentially an attempt to create the progressive equivalent of the tea party. There are currently about 1200 gatherings planned for the weekend of the 16th and 17th and they are eager to get as much of a turnout as possible. They still need people to host these gatherings as well. The website has all the tools and resources that you would need to host a gathering. If an organization with very little substance such as the tea party can generate so many participants I would think a progressive party that has so much substance should attract twice as many, at least. So please go to moveon.org and participate.
Happy 4th, jason
As usual, you lay out a brilliant commentary. The only problem is the Republicans use a different form of logic and reason than you do. Instead of trying to find ways to solve problems in a way beneficial to all, their form of logic revolves around getting and keeping power and money. And the end always justifies means.
Just issue some credit default government bonds to cover it all.
Question; (maybe another subject?) ..as a Canadian, flush with all this high-value (if funny looking) Canadian cash.. am I allowed to donate to Stephen Colbert's Super Pac?
If not, I guess if I register a company in Nevada etc.. that company would have the 'free-speech rights' to throw all the cash 'it' wants into the campaigns? Is that the way it works?
Seriously, the first thing our own little neo-con Harper did with his 40% 'majority' was to cut out government funding for political parties. Hmm, he has just ordered postal workers back to work with less money than what was offered by the post office; he's sounding like a Republican Governor.
First thing to cut would be Congressional Salaries, and elimination of ALL their percs!!
"as a Canadian, flush with all this high-value (if funny looking) Canadian cash.. am I allowed to donate to Stephen Colbert's Super Pac?"
If you are having problems, as a real person, donating to a Pac then just incorporate into a faux person, a company or corporation, and you may be able to buy any of your favorite politicians that way....our Supreme Court made this all possible.
At this late date to even consider that Obama has any interest in preserving Social Security and Medicare and anything else that benefits the middle class is retaining blind faith in a President who has done nothing but pander to Wall Street, big oil, big coal, the nuclear industry, the military industrial complex and his billionaire supporters since he entered the Oval Office. Because Obama chose to call himself a Democrat when he first entered politics he has been given carte blanche to do as he pleases without being restrained by real Democrats fighting him tooth and nail while he fulfills his promises to billionaires. Obama was a Trojan horse that entered the Oval Office as the voters' gift to themselves. They had blind faith and blind hope that he would deliver on his promise of "change". Little did they know that inside that Trojan horse was a liar and a hypocrite who, as soon as he was elected, proceeded to betray them. And when Obama is re-elected he will finish the job he started during his first term: the decimation of the middle class. The blind faith of Democrats in not wanting to aknowledge who and what Obama is or merely labeling him weak and innefectual will insure that this will happen. And those that are hanging on to the slim hope that if Obama is re-elected he will make an appointment to the Supreme Court that will swing the court to the left are living in a dream world. Those people are willing to gamble away our Social Security and Medicare on a future Supreme Court nomination that could cement the complete take-over of our country by the oligarchs. After Obama is re-elected he will no longer have to throw crumbs to the left. He can show himself for the neo-con that he is. And after his second term he can join his fellow neo-cons on their yachts, rewrite history in his post-presidential book, look at the destruction he has wreaked on all the rest of us, and say "let them eat cake."
A. Like heaven, it's nice to believe one exists.
Q. Does President Obama have a secret weapon?
A. An insurance giant will fail.
Q. What do you think will happen?
If there needs to be a cut to gain the $20 B, the first place to cut should be Congress salary....all of them, their staff. Then cut some military contracts and if that doesn't get some fire under the Republicans, I'm sure there are who won't stand to have their contracts cut.
But start with Congress pay first. They are public employees and took oath to serve the common welfare of the country. So let them serve.
First Rick in Canada, yes, start a corporation, then you can donate an unlimited amount to Colbert's SuperPAC.
As far as where to cut first, farm subsidies, and subsidies to airlines to fly into small regional airports, and any other acts of IslamoCommunoSocialioNazism that goes to Red States. Make the little piggies fry. Make them beg to get their pork back. But make them do it in public. Make all the big strong sovreign individuals up in Alaska call their Teab Baggin' congresscritter, and beg for their airline subsidies. Make all those rugged indiviiduals beg for it.
And then tell them "no, you are a commie whore."
This is the fight where we can bring the proverbial ass whuppin to. The President holds the trump pork card check book. Letting Cantor and Boener off the hook early will be retarded.
Economists??? They are all idiots and shills for America's criminal syndicate called Washington.
The debt defaulted on May 22nd. President Obama does not have to wait until August 2nd to be selective in how monies are disbursed. He can instruct Secretary of the Treasury Tim Geithner NOW to withhold payment to any debt. Withholding payment now would extend the August 2nd date since it would increase the available monies.
I'm so in line with your thinking, and thinking does nothing but get people worked up in their heads. We need more grassroot efforts, media coverage, and unfortunately, something big to go along with it. I'd like to see the workers of this country take a few months off like the Europeans do. Let's see how long their companies, offices, etc. can run without us. The French have used this tactic to their advantage for years, and it works big time!! Sometimes, it takes a drastic move to wake us up!! We seem to be still too comfortable with too much to lose, to really put our thoughts on the line. So what's it going to take???
In response to the person who was berating Obama as a masked republican!! That is one perspective!! What if these guys are so entrenched in the system, that taking them on as we thought he could do, was impossible without really putting us(the people) in dire straits. What if he's holding them at bay until his next election, when he might be able to really do something without any concerns for keeping his seat. What if, when he took office, he found out what really takes place up there. Perhaps his family was in danger!! We really have no idea what happened when He took office, but one thing is clear. The last several decades of thinking in the white house, has put us in extreme danger, and no one person is going to get us out of that. We need to take responsibility and do something at the grassroots level. He has said that over and over again, and a few are listening to him. He can't do it alone. It's too big!! I think he's done the best he could with what he now knows, as he's a very thoughtful and brilliant mind/heart, someone who many don't recognize, as he's refusing to play the game as it has been played for decades. He is solving the problems from a different level than they are being created on--something that most of us have yet to understand how to do, so there are always different perspectives, and we need to learn that lesson before we can make substantive changes.
The article presents an excellent strategy, but for Obama to do it would require him to grow a pair, something he's already demonstrated he's incapable of doing.
Rather than directly targeting red states, simply stop all payments to certain programs such as farm subsidies, military hardware purchases and maintenance for programs such as submarines, aircraft carriers, tactical fighters and other hardware not immediately needed for theater operations in Asia. These programs benefit the wealthy and weigh heavily in favor of red states.