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CURL: Consequences of debt crisis aren’t too dire for our leaders
Question of the Day
Just how dire is the crisis over the $14,294,000,000,000 debt ceiling, which America will hit on about May 16?
So dire that President Obama spent much of last week traipsing across the West collecting campaign cash (and hit the golf course for Round No. 65 on Saturday). So dire that Congress headed off on a two-week vacation (and Sen. Harry Reid jetted off to China on a 10-day junket with nine colleagues, costing taxpayers millions).
So dire that lawmakers have scheduled their first major meeting on the issue for May 5 - 11 days before America goes into global default. And, last, so dire that the “smartest president ever” has put his top man on it - Vice President Joe Biden.
The message from the unmiffed politicos inside the Beltway is clear: When you’re $14 trillion in debt, what’s another trillion or two? Let’s just get another credit card - even if we have to pay 29.9 percent - and charge it up.
Democrats have staked out some odd new rhetorical territory: Republicans who reject a move to raise the debt ceiling, they say, are threatening U.S. national security - and possibly putting in jeopardy the life of every man, woman and child in America.
The White House has its own flourish: The president is more concerned about the “full faith and credit” of the United States around the world, at least according to flack Jay Carney, who has used the phrase approximately 1,487 times in the past few weeks.
The situation is already beyond bad: If America walked into a Hyundai dealership intent on buying a 2011 Elantra, the salesman would pull her credit scores and laugh her out of the showroom. And that’s just what Standard & Poor’s, one of three main agencies that rate the ability of sovereign nations to repay their debts, did last week. The agency lowered its outlook for America’s long-term AAA credit rating from “stable” to “negative.”
But America’s president hardly batted an eye, and lawmakers yawned. How little does Congress care about the ballooning debt? Republicans cheered from the rafters this month when they passed a $38 billion spending cut;but on one recent day, the debt rose by $34.5 billion. Admittedly an atypical day — April 15. But still: in one day.
Democrats, on the other hand, have offered almost no viable options, instead opting to demagogue the issue along the lines of the 1980s Mediscare misinformation campaign.
Mr. Obama has dismissed a GOP plan to cut the national debt by $6 trillion, calling it “radical” (and he should know). But what else would such a plan be?
Here are the simple facts: Americans paid in $2.2 trillion in taxes last year. But the government paid out to Americans $2.3 trillion in expanded unemployment benefits, Social Security, Medicare, Medicaid, etc. (the first time that’s happened since the Great Depression). And that’s even before paying for three wars and everything else the federal government funds.
Maybe the United States needs a little credit repair counseling from, say, Keenan Glass, who runs Credit-Today.com.
Mr. Glass said the U.S. debt is like an individual making $100,000 a year - but with $300,000 in debt. “We’re to the point where even just cutting spending isn’t going to help; you’re never going to get out of debt, everything’s just going to keep getting worse,” he said.
“The next option is: You could file for bankruptcy. … But that’s not really realistic,” Mr. Glass said with a laugh.
So America’s got two choices: Pay off the debt - somehow, over years and years - or increase its credit limit and just keep juggling debt.
And that latter course is, of course, the easiest and least painful option. Rather than simply cutting spending by 20 percent across the board - which is what any normal American family would do - lawmakers will instead just raise the credit limit, even as they put the nation an average of $5 billion more into debt every day.
“Either way, the U.S. has got to hire a professional to help it manage its debt,” he said.
Left unexamined is just how the world’s richest country came to be $14 trillion in debt. Millionaires and billionaires (despised by Mr. Obama) manage their money so that they never have to work again, instead investing their capital to make their money earn even more money. Just why does the United States owe China and Japan trillions of dollars, when they should owe us trillion?
Of all the possible solutions to the problem - even “radical” ones - it’s clear that the very worst is to borrow more. Which is why Congress will do exactly that.
• Joseph Curl covered the White House and politics for a decade for The Washington Times. He can be reached at firstname.lastname@example.org.
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