Revenge of the return of the son of the bride of the debt ceiling
On Monday, President Obama held a press conference largely devoted to setting the stage for the coming debt ceiling showdown. It went on for a while, but the President didn’t really say anything new. In fact, he was very determined to repeat a set of talking points, which could be summarized as follows:
1. The debt ceiling must be raised in order to pay bills we have already incurred. (Note that by “we,” the President pointedly means “everyone but me.”)
2. If the debt ceiling is not raised, America will default on its debt. Remarkably, the President actually took a stab at blaming previous American credit downgrades on the reluctance of responsible people to spend more money.
3. The Republicans are “taking America hostage” by threatening to hold the debt ceiling in place, or shut down the government. He returned to this offensive “hostage” rhetoric several times, at one point describing the possibility of a government shutdown as “a gun held to the heads of the American people.” Classy! What sort of gun do you suppose Obama envisioned himself holding when he opposed raising the debt ceiling as a Senator?
Unpacking Obama’s speech is difficult only if his rhetoric is allowed to obscure his true perspective. He thinks the government should spend more and control more, without any limit except the political realities of the moment. He believes he has arrived at a moment that will allow a massive new surge in the size and scope of the central State, through a combination of spending, tax increases, and regulation. (A good bit of his press conference was also dedicated to the push for new gun control regulations.)
President Obama does not care about the national debt or the deficit, except as a means to expand the power of the State. This is why phrases like “deficit reduction” and “balanced approach” are synonymous with “tax increases” to him. In any other context, talk of the deficit is an annoying distraction. He advertised his willingness to “discuss” deficit reduction several times during the press conference… while simultaneously declaring his absolute and unwavering resistance to anything that would actually make the government smaller. Even on the rare occasion where he’s willing to broach the topic of spending cuts, Obama means that term in the old, corrupt Washington sense: a modest reduction in the rate of growth, rather than an actual “cut.”
The President’s heavily emphasized point about raising the debt ceiling to pay bills already incurred is a damning indictment of his style of government, not a talking point in his favor. It would logically work to his benefit only if he also supported a firm balanced budget amendment - but of course, he would be strenuously opposed to any such thing. Instead, he is heavily in favor of racking up even more debt… knowing full well that the next time the debt ceiling approaches, he will once again say that it must be raised to pay the bills we incurred after the last time he said we had to raise it to pay the bills we already incurred.
For Obama to portray himself as the voice of fiscal responsibility, scolding a band of congressional spendthrifts he is somehow powerless to influence about making good on their past commitments, is grotesque and stupid. There is no reason to take anyone who uses the “more debt to pay our existing commitments” argument seriously unless they are also determined to avoid making any such commitments. Otherwise, you’re listening to someone insist on an increase in his Visa credit card limit so he can use the Visa to pay his MasterCard bill. Obama said that America needed to show the world we are serious about paying our bills. He intends to do that by racking up a fresh pile of bills, and refusing to pay them.
It must once again be emphasized that failure to raise the debt ceiling would not, in any sense of the word, cause the United States to “default” on its debt. Interest on our debt accounts for less than 10 percent of federal spending. If the debt ceiling were left in place, and Obama decided to use that excuse to halt mandatory spending on debt service, he would be impeached and removed from office. I’m sorry to put it so bluntly, but if he wants to frighten the American people by spouting nonsense, I’m happy to join in and extend his fantasy scenario to its logical conclusion.
In reality, there is zero chance any of that would come to pass, even if the debt ceiling were held firm. Neither would the payroll of American troops or Social Security be halted, as Obama threatened. There is more than enough federal revenue to pay for those things. (I suppose it’s progress to see that Obama once again feels free to portray Social Security, accurately, as an insolvent welfare program he can halt, not some sort of special inviolate bond of trust between American workers and the government.)
To tie this back to the President’s lament about paying the bills we’ve already incurred, a freeze on federal debt would necessitate a freeze on federal spending, plus some minor structural cuts (in the real sense of that word.) This would seem cataclysmic only because huge automatic increases are built into federal programs, and large-scale deficit spending has relieved the government of any pressure to choose between them. The federal government doesn’t even have a budget any more. Leave the debt ceiling in place, and suddenly it would be time to choose between, say, military payroll and food stamps, or Social Security and pork-barrel spending. It would mean the sudden return of real priorities and tough spending decisions. It would mean that tax increases have to be presented to the American people as the raising of funds for specific, immediate ends.
The deficit-fueled governing style Obama prefers is all about accumulating huge commitments without having to make any hard choices between dependency groups… or any hard sales to current taxpayers. Instead, tomorrow’s taxpayers will be told they must pay more – and the government must be allowed to borrow more – because America has to show the world it can pay its bills. They’ll be told arguing with this imperative is impossible, and even immoral. And it won’t just be people who make $450k, or even $250k, who are lectured on the need to “pay their fair share.”
Now that’s what I call “taking hostages.” They don’t see the gun, until it’s too late to escape. Many of them are even willing to help load it.
Update: Sen. Pat Toomey (R-PA) strongly disputes the President’s assertion that a debt-ceiling increase would really be all about paying for existing commitments: “The president’s repeated insistence that raising the debt ceiling is necessary to only pay the bills we have already incurred is patently false. Past spending has already been funded through a combination of taxes collected and previously issued debt. The president is calling for an increase in the debt ceiling in order to issue new debt which will pay for future spending. It is precisely this future spending which must be brought under control.”
“After all the middle class tax hikes in ObamaCare and the tax increases he received at the end of last year, the president now wants still higher taxes to pay for even more spending,” Toomey continued. ”This must not happen. The more we tax and spend, the more we diminish incentives to work, save and invest, and the weaker our economy will be. Now is the time to focus on the real fiscal problem: overspending in Washington. Instead of engaging in scare tactics, the president should work with congress to achieve the genuine, significant spending cuts we need to put our country on a sustainable path.”