Another one to the breach

The now combined government funding and so-called debt ceiling crisis, manufactured by a rump of the Republicans elected to Congress (and to which the other Republican members have passively accepted, some with less grace than others) sure hasn’t been good for the reputation of Republicans as tacticians. If these sons of the Confederacy had been in charge of the Army of Northern Virginia, the civil war would have been over about three-and-a-half years earlier. Of course, it’s difficult to devise tactics when you have no strategy, and that is the particular fly that is in the ointment which is the modern Republican party.

This does not stop them from making grand statements, however. Some, as we have seen, will talk for hours on end, even though he knew it was of no use to anything. Ted Cruz has gained a reputation in some quarters as a great patriot for his heroic stand. The all night of talking on the Senate floor reminded many of how Davy Crockett and Sam Bowie stood at the edge of the Alamo, read children’s books for 22 hours, then went home to bed and followed that up with fund-raising appearances.

Since Sunday morning TV news shows are required to give prominent Republicans a soap box to deliver themselves of whatever is on their minds, small though that may be, we have heard an increasing amount of nuttiness in the past two weeks. Louie Gohmert, always good for a chuckle, reminded everyone that the debt ceiling is the law of the land. So if that has to be changed, it requires another law to be changed and they designate the Affordable Care Act. This is evidently an analogy to the Law of the Conservation of Matter. No legislation can be created or modified, unless another law is repealed or modified.

What is surprising, however, is how the Republicans have consistently shown that knowing something is really not necessary for taking a position on matters of vital public interest. It’s been about 30 years or so that the Republicans have been pushing the notion that knowledge about public affairs is a sign of “liberalness,” which in turn is a sign of perfidy, which, mainly because it doesn’t involve also personal corruption, is something the Republican Party, and by definition therefore, the United States of America, cannot tolerate. It is no wonder then that this party seems to produce only people with no knowledge of public policy. They also seem to have no understanding of the nature of the laws that these “law-makers” have created.

Today, for example, Senator Tom Coburn has proven again (if that were really necessary by now) that his lack of knowledge shows him to be in the mainstream of the Republican Party. He said, with all the pomp of the truly ignorant, that ” the notion the United States will default if Congress doesn’t raise the debt ceiling is pure ‘rumor.'” This is so because the Treasury Department will still have enough money to pay interest on debt.

Of course, Coburn misunderstands what the debt ceiling does, what constitutes default and why we are in this situation. First off, the debt ceiling has nothing to do with creating, raising or lowering the obligations of the United States. Those were fixed when lawmakers, like Senator Coburn, passed laws creating obligations on the part of the United States to people and entities. If the U.S. government does not make timely payment on these obligations it is a default. Just like, it is a default if you fail to pay your mortgage, even if you and your partner agreed to only spend a certain amount this month and the mortgage would “technically” exceed that amount, so you don’t pay it.

It doesn’t matter if the obligation is to redeem Treasury securities or pay a government contractor or to reimburse a state or to pay welfare benefits. If Congress created the obligation on the part of the United States Government, failure to make timely payment is a default.

So what’s all this about a “debt ceiling,” asks the ever curious Tom Coburn, who never mastered this in his years as one the of Republican wise men in the Senate. Well, the government can only pay its obligations if it has money which it collected from taxes or from sales of securities to investors (or really primary dealers who in turn sell them to investors.) As we know, Republicans will not tolerate the raising of taxes to pay for the obligations that they voted for as Congressmen. So Treasury must sell securities. But the so-called “debt-ceiling” says that if the sales of securities reaches a certain point the Treasury must come back to Congress before it can sell more. And here we are. Congress wants the government to pay for things but won’t give it tax revenue and the Republican rump is having a fit about a law that has the concept of “debt” and the concept of “ceiling” which they think means, if we “raise” the “ceiling” we are permitting more spending, which they equate with debt. The problem is the debt was incurred when the obligations were incurred; the question now is how Congress decides to make payment. If they decide not to make payment it is a default. And the funny thing about that is that the default will not make the obligations go away, the creditors will still have a legal right to payment, but the U.S. government will have committed an act of insolvency.

Maybe Republicans think that there will be a gigantic bankruptcy proceeding which will result in assets like the national forests being sold off to their contributors the timber interests, and rights of way to their contributors the oil interests, and museums to the Koch brothers, and so on and so on.   They have been selling out the country piecemeal since the 1980s. Or maybe they haven’t thought that far. I guess we’ll find out in next Sunday’s morning shows.

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  1. Thanks for this post.I appreciate it.
    You know, I don’t think there’s much ignorance involved here – not even with neophyte delegations. I think it’s all a willful, cynical, knowing and extreme effort and every single one of them is participating on that level. In certain ways, analyzing them on any other level legitimizes them. But what choice do we have? They are in a position to force the terms of a discussion of which they aren’t remotely worthy.
    Anyway – thanks again. You contribute a great deal.

  2. Thanks, Claire.

    You are quite right that they are malignant, and evil and it’s not worth the effort to go beyond that. It’s certainly not worth taking them at their word.

    But the problem is that they are endlessly fascinating. Like one of the bizarre characters in a Dostoevsky novel. Like Svidragalov, for example. You know he is evil, you know what he says can’t be trusted, but you see him acting irrationally and you can’t help yourself but to try to figure out what is driving him to act the way he does.

    In this case, the end game seems nothing less than pure anarchy. If a group of Congressmen force a default, causing a cascade of other players (investment banks, funds, central banks of other countries, insurance companies, etc.) to be unable to pay their immediate obligations or otherwise become insecure because the value of their portfolio of U.Sl obligations has suddenly plummeted, then there will be a cascade of defaults that will likely severely damage American capitalism. And it is the Republican constituency (Wall Street, banks, insurers, and the Chamber of Commerce), who are saying these things. So what the hell are these guys doing?

    It will be interesting to see what their end game is. The one thing that is perfectly clear is that giving in to any demand to Republicans simply to avoid a default on obligations that government has lawfully incurred, will mean that not only will the creditworthiness of the US be shot, but even its ability to govern itself, because at every stage of the irrational budgeting process some rump group or another can attempt a coup.

    These sons of Confederacy sound just like the legislators of South Carolina did when they voted to seize Fort Sumner. They are all convincing themselves that nothing bad is going to happen.

  3. I see what you mean
    South Carolina’s elite really did meet every definition of a brand of real insanity. Who was it who severely beat a Northern peer with a cane on the floor of Congress? I recall an undergraduate professor shaking his head over the state as if it were an incorrigible delinquent.
    “First one out, last one back in (the Union)” he sighed. “And it certainly didn’t deserve to be trusted at that point – far, far from it.”
    They were siezed with a kind of fever that does indeed resemble the fever being displayed today. Yet, their class was wily enough to troll the globe seeking international support for the Confederacy..
    I know it’s no longer possible to refer to a Marxist perspective without being a lot more specific than that. Still, I think one can say that its basic theory has been remarkably reliable in terms of the inevitability of class interests ruthlessly and automatically reproducing themselves. But for capitalism to be dismantled by the ruling class itself – it is as mind boggling as you describe!
    I would not ever discard the possibility of a military takeover, using both an inflated version of terrorism and the economic failure of the government as a pretext.. The question is whether the Left could take advantage of the same situation …
    You make me want to actually read Dostoevsky, rather than just know all the titles of his novels 🙂 However, he may well prove to be over my head: I’m still trying to figure out why I don’t get Jane Austen – I just read a critical essay on Sense and Sensibility by Margaret Drabble and felt like a hopeless idiot.
    Well, now I’m babbling on – and off the topic to boot, so I’ll sign off!
    Thanks so much for your thoughtful response. I appreciate it…

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