The government is broke and the only way out right now is to increase the credit card limit.
The GOP is opposed to raising the limit but simultaneously they seem to recognize that it is the only choice.
Bernanke went before Congress yesterday and recommended to the GOP controlled House to raise the limit and view the national debt reduction plan as a long term objective. The notion that severe budget cuts will somehow correct the matter this year is held by the GOP and this notion runs contrary to Bernanke, the Obama administration, and many economists.
I am in the camp that believes the GOP is attempting to seize this issue and use it to introduce its agenda. The agenda goes beyond dollars. It places the burden of the cuts on the middle class and the poor. Entitlement programs, public schools, woman's health care, unions, social security, and medicare are all on the GOP hit list. Also, the GOP is interested in ending the mortgage interest tax deduction, which for most Americans is the only path to accumulating decent equity through owning a house.
I want to comment on one aspect of the authoritarian personality and how it is playing out at this time. This is the issue of loyalty. Recall that in Wisconsin many who voted for Walker are simultaneously in the GOP and in the state workers' union. These people are rejecting Walker's policies which call for the neutralization of the unions' power. This will affect these union GOP people adversely. What this represents is another aspect of how loyalty to the GOP will allow individuals to vote against their own interests. We see this over and over. Loyalty will trump obvious common sense in the authoritarian world.
We need to be on top of this deficit reduction GOP plan because this is the country's Wisconsin moment. We are all on the block here.
CS Monitor: Federal Reserve chief warns GOP: Don't hold debt-ceiling vote hostage
A refusal to lift the ceiling would prevent the Treasury from making payments on debts already accrued by Congress. That's like a family trying to solve its finance problems by refusing to make debt payments, Bernanke said.
By contrast, Bernanke said a responsible path is to get future spending under control – like a family cutting up its credit card.
2 comments:
Bernake hasn't made a right call yet, except for the banksters who he's just a shill. he wants all of us to cut up the Nat'l credit card he says, except for the one he gave to the banksters and the militarists. Hypocrite.
He could care less about you and me, he is an elitist. But he does know that the new GOP Congress is completely crazy.
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