Monday, July 11, 2011

100th Post! My Thoughts on the Debt Ceiling..

What better time to discuss the debt ceiling debate then my 100th blog post?

As my readers my have noticed, I've taken a bit of break from blogging as of late, mainly because of personal stuff but I am back with a vengence, attempting to tackle the debt ceiling debate which has been going on now for several weeks and just when we thought they were getting some traction..

So for those who haven't been following the debate as closely as political wonks like myself, here is the short version:

Until this weekend, there was serious talk that President Obama and GOP House Speaker Boehner were discussing what has been called the "Big Deal" debt ceiling compromise which was to include a total of $4 Trillion in future cuts from the federal debt over the next ten years. It was to include possible entitlement reform and also an increase in income tax for some Americans. However, come this weekend, the GOP caucus made it very clear to Speaker Boehner that any tax increases would not pass the House of Representatives and as such the Speaker walked out of the meeting with the President.

Days later, Speaker Boehner made it clear that any tax increases would be part of any compromise and now is even denying they were ever on the table in the first place and this has now put the entire talks back into limbo.

Today, the President during a press conference agreed that entitlement reform would likely have to be done to help cut the federal debt but also emphasized that such cuts without tax increases would not fix our ailing economy.

A short time later, Speaker Boehner also held a press conference in which he agreed with the President that raising the debt ceiling is a must and not doing so put our fragile and barely existent recovery at risk. However he emphasized his major difference with the President: that raising taxes in a time of economic trouble is not a good idea. Speaker Boehner also made reference to suggestions of late that tax loopholes be taken out of the US tax code and by doing this and lowing corporate taxes, the tax base could be broadened and along with the proposed cuts could put the US government in better financial shape and in turn give the economy the best chance possible.

And just when you think they are only two sides to a political debate, Michelle Bachmann suggests a "third way" and what a great option it is..

Michelle Bachmann was recently released a political ad in which she promises to not vote for ANY debt ceiling bill no matter what...Even if it has Speaker Boehner's stamp of approval. Because of this rather surprising and somewhat dimwitted opinion, even Conservative commentator Bill O'Reilly had to call out the Congresswoman on her opinion of the issue. Bachmann claims that the government has enough revenue coming in to cover the immediate interest payments on the government's outstanding debt. However as FoxNews' Brit Hume pointed out on O'Reilly's show tonight, while the government does have revenue coming in, it likely won't be enough to keep from causing a major distruption worldwide and even affect government programs (he used farm subsidies here in Iowa). Bill-O's final opinion was that the debt ceiling needs to be raised because of not doing so it too great.

Personally, of the two politicians and the twit, I am finding Speaker Boehner's position the best compromise to raise the debt ceiling. While the cuts aren't as great as the "Big Deal" discussed this weekend, they are large enough that it certainly couldn't hurt the economy any worse then what the government is doing now (aka, NOTHING) and in the near future (perhaps after the 2012 election) more cuts could be made.

And while I do give the President credit for he rather abrupt U-turn when it comes to entitlement reform being part of any compromise (which is now incurring the wrath of Democrats in both houses of Congress), his change of opinion IMO suggests he is doing this more for his political survival then an actual change in belief.

And I also know the idea of raising the debt ceiling from its current $14+ trillion limit at all does make alot of people's head spin, the idea of defaulting on US debt for the first time in history should scare every American. Imagine overnight the stock market and US Dollar both racing to see who can hit the floor first..Not a nice thought is it?

But as you might have guessed, we are no closer to a compromise today then we were a week ago..Compromise may be what makes politics go 'round (at least that's what they talk me at college), it drives this American up a frickin wall!

So stayed tuned folks, after this weekend these talks could go into any number of directions and as politics usually do..It's going to get messy.

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