Obama says has reached his limit in debt talks

happy jack wrote:

Why is this time so different?

Because this time they have a chance of succeeding, don't they? I don't remember such negotiations the last time it was raised. There was a vote, Democrats said no, Republicans said yes, and that was it.

happy jack wrote:

Why have the media decided that this time the sky is going to fall?

Why have the Republicans decided that this time the sky is going to fall if they do raise the debt ceiling? At some point we have to decide if what we're doing now is worthwhile, rather than offering the "well they did it first" whine as some sort of defense, don't we?

If you have a "not raising the debt ceiling will be great for the economy" link or analysis, I'd love to see it. I asked that ages ago and no one could provide one. Those warning of the dangers involved, however, were pretty easily found. And such warnings continue to be issued by our businesses and "job creators" today.

Heretic wrote:

If you have a "not raising the debt ceiling will be great for the economy" link or analysis, I'd love to see it. I asked that ages ago and no one could provide one. Those warning of the dangers involved, however, were pretty easily found. And such warnings continue to be issued by our businesses and "job creators" today.

Quote :

Moody's suggests U.S. eliminate debt ceiling

Walter Brandimarte

Reuters

9:35 AM CDT, July 18, 2011

NEW YORK (Reuters) - Ratings agency Moody's on Monday suggested the United States should eliminate its statutory limit on government debt to reduce uncertainty among bond holders.

The United States is one of the few countries where Congress sets a ceiling on government debt, which creates "periodic uncertainty" over the government's ability to meet its obligations, Moody's said in a report.

"We would reduce our assessment of event risk if the government changed its framework for managing government debt to lessen or eliminate that uncertainty," Moody's analyst Steven Hess wrote in the report.

The agency last week warned it would cut the United States' AAA credit rating if the government misses debt payments, increasing pressure on Republicans and the White House to come up with a budget agreement.

Moody's said it had always considered the risk of a U.S. debt default very low because Congress has regularly raised the debt ceiling during many decades, usually without controversy.

However, the current wide divisions between the House of Representatives and the Obama administration over the debt limit creates a high level of uncertainty and causes us to raise our assessment of event risk," Hess said.

Stepping further into the heated political debate about U.S. debt problems, Moody's suggested the government could look at other ways to limit debt.

It cited Chile, widely praised as Latin America's most fiscally-sound country, as an example.

"Elsewhere, the level of deficits is constrained by a 'fiscal rule,' which means the rise in debt is constrained though not technically limited," Moody's said, adding that such rule has been effective in Chile.

It also cited the example of the Maastricht criteria in Europe, which determines that the ratio of government debt to GDP should not exceed 60 percent. It noted, however, that such a rule is often breached by the governments.

In the United States, Moody's said the debt limit had not effectively curbed the rise in government debt because lawmakers regularly raise it and because that limit is not related to the level of expenditures approved by Congress.

Heretic wrote:

happy jack wrote:

Why is this time so different?

Because this time they have a chance of succeeding, don't they? I don't remember such negotiations the last time it was raised. There was a vote, Democrats said no, Republicans said yes, and that was it.

That's exactly right. The Democrats didn't resort to what amounts to extortion in order to attempt to push through an agenda of their own. The Republicans tried to do the same thing when Clinton was President, in 1995-96. We all know how that turned out, don't we?

Quote :

The most recent pledge to freeze the federal debt ceiling is notable because congressional Republicans tried the same thing following their takeover of Congress in 1995. That fall, Republicans refused to raise the debt ceiling unless then-President Bill Clinton agreed to enact major planks of the radical “Contract with America” proposed by the Republican Party, such as a $270 billion cut to Medicare, steep cuts to education funding, and massive deregulation measures. Indeed, then-Speaker of the House Newt Gingrich at one point threatened to force a default on the national debt if Republicans did not get their way.

This standoff, which lasted until March 1996, ended with the Republicans backing down as the public increasingly became turned off by the government shutdowns that resulted.

happy jack wrote:

Scorpion wrote:

Indeed, then-Speaker of the House Newt Gingrich at one point threatened to force a default on the national debt if Republicans did not get their way.

And now Barry is threatening to force a default on the national debt if Barry doesn't get his way.
Is Barry's 'extortion' somehow purer than the Republicans' 'extortion'?

Barry is trying to raise the debt ceiling in order to keep this economy moving, like every President has before him. Republicans are objecting not only on the phony "It's bad.. Mkay?" line, but the "we'll ruin the economy unless you give us what we want" line, as well.

BWG link sums it up perfectly:

Quote :

Moody's said it had always considered the risk of a U.S. debt default very low because Congress has regularly raised the debt ceiling during many decades, usually without controversy.

BigWhiteGuy wrote:

NEW YORK (Reuters) - Ratings agency Moody's on Monday suggested the United States should eliminate its statutory limit on government debt to reduce uncertainty among bond holders.

Seriously? We just shouldn't have a debt limit? Sounds good to me, since they don't seem to actually do anything anyway, but I really don't understand how you can support what the Republicans are doing in light of that.

happy jack wrote:

Scorpion wrote:

Indeed, then-Speaker of the House Newt Gingrich at one point threatened to force a default on the national debt if Republicans did not get their way.

And now Barry is threatening to force a default on the national debt if Barry doesn't get his way.
Is Barry's 'extortion' somehow purer than the Republicans' 'extortion'?

What the hell are you talking about? Congress, not the President, sets the debt limit. The President cannot "force a default" in any way, shape or form. Based upon your statements in this thread, I'm really starting to wonder if you have any knowledge about this issue at all.

Heretic wrote:

BigWhiteGuy wrote:

NEW YORK (Reuters) - Ratings agency Moody's on Monday suggested the United States should eliminate its statutory limit on government debt to reduce uncertainty among bond holders.

Seriously? We just shouldn't have a debt limit? Sounds good to me, since they don't seem to actually do anything anyway, but I really don't understand how you can support what the Republicans are doing in light of that.

I don't support either side. But what I would support is a balanced budget amendment.

Scorpion wrote:

I'm really starting to wonder if you have any knowledge about this issue at all.

None of them do. First, there's this epic fail:

Quote :

House Republicans voted to make the Ryan budget law. But the Ryan budget includes $6 trillion in new debt over the next 10 years, which means that to become law, the Ryan budget would require a substantial increase in the debt ceiling. But before the Republicans agree to increase the debt ceiling so that the budget they passed can become law, Republicans are demanding the passage of either a balanced budget amendment that would make the Ryan budget unconstitutional or a spending cap that the Ryan budget would, in certain years (and if you’re using more realistic numbers, in all years), exceed.

Combine that with the number of ignored warnings from economists, business leaders, organizations, hell, some of Dubya's and Ronnie's economic advisors all warning how bad this will damage our already frail economy... Yeah. Their completely clueless.

BigWhiteGuy wrote:

But what I would support is a balanced budget amendment.

This thing? Why is that?

happy jack wrote:

Scorpion wrote:

happy jack wrote:

And now Barry is threatening to force a default on the national debt if Barry doesn't get his way.
Is Barry's 'extortion' somehow purer than the Republicans' 'extortion'?

What the hell are you talking about? Congress, not the President, sets the debt limit. The President cannot "force a default" in any way, shape or form. Based upon your statements in this thread, I'm really starting to wonder if you have any knowledge about this issue at all.

Well, then.
He must have misplaced his veto pen.

The President has no reason to veto a rise in the debt ceiling. It's simply an acknowledgement that additional spending authority is necessary in order to pay the nation's bills. There is nothing wrong with trying to reach an agreement that includes some spending and revenue adjustments as well, but if an agreement on that cannot be completed in time to avoid a default, then it's incumbent on the Congress to raise the debt ceiling, period.

Scorpion wrote:

The President has no reason to veto a rise in the debt ceiling.

Maybe not.
But this president has found a reason to veto a mechanism which might make that rise in the debt ceiling easier to attain.

http://thehill.com/homenews/administration/171997-obama-officially-threatens-to-veto-cup-cap-and-balance

Obama officially threatens to veto Republicans' 'cut, cap and balance' bill

By Sam Youngman - 07/18/11 03:58 PM ET

The White House on Monday warned President Obama will veto GOP legislation to “cut, cap and balance” spending and the budget.
………
"This unfortunate veto threat should make clear that the issue is not congressional inaction, but rather the [resident’s unwillingness to cut spending and restrain the future growth of our government. If we are going to raise the debt limit and avoid default, the White House must be willing to demonstrate more courage than we have seen to date," Boehner said.

happy jack wrote:

Scorpion wrote:

The President has no reason to veto a rise in the debt ceiling.

Maybe not.
But this president has found a reason to veto a mechanism which might make that rise in the debt ceiling easier to attain.

http://thehill.com/homenews/administration/171997-obama-officially-threatens-to-veto-cup-cap-and-balance

Obama officially threatens to veto Republicans' 'cut, cap and balance' bill

By Sam Youngman - 07/18/11 03:58 PM ET

The White House on Monday warned President Obama will veto GOP legislation to “cut, cap and balance” spending and the budget.
………
"This unfortunate veto threat should make clear that the issue is not congressional inaction, but rather the President’s unwillingness to cut spending and restrain the future growth of our government. If we are going to raise the debt limit and avoid default, the White House must be willing to demonstrate more courage than we have seen to date," Boehner said.

Are you frickin' kidding me? That bill is about as bogus as it gets. It doesn't matter, anyway. There is no way that will pass in the Senate. There is no way it will even get to the President, nor should it. If you don't understand why it shouldn't, then I suggest that you read it. I don't mind discussing it, but I'll be damned if I'm going to waste my time debating it with someone who is most likely only familiar with the "title" of the bill.

It's just political theater. In the end, we'll most likely end up with "Plan B." That way, the Republicans won't have to actually vote to raise the debt limit.

happy jack wrote:

Heretic wrote:

I don't remember such negotiations the last time it was raised. There was a vote, Democrats said no, Republicans said yes, and that was it.

So this time, the Republicans say no and the Democrats say yes.
Let there be a vote.
That is the accepted process, isn't it?

No. That's not the "accepted process." IIRC, the Democrats controlled the House in 2008, yet voted to raise the debt ceiling twice, when Bush was President... not to mention the numerous times that Democratic Congresses did so when Reagan was President.

The debt ceiling is usually automatic, raised appropriately when the budget gets passed. They can repeal that part of the process and put the raise up for a vote, which is usually just a symbolic one:

George Will wrote:

I know of no other developed nation that has a debt ceiling. This is a purely recurring symbolic vote to make people feel good by voting against it. The trouble is, it's suicidal if you should happen to miscalculate and have all kinds of people voting against it as a symbolic vote and turn out to be a majority, because if the United States defaults on its sovereign debt, the markets -- well, it will be stimulating.

Republicans certainly had no problem doing so before so I certainly don't understand why it's a problem now, especially since it doesn't actually do anything about our debt. As the GAO tried to explain back in February:

Quote :

The debt limit does not control or limit the ability of the federal government to run deficits or incur obligations. Rather, it is a limit on the ability to pay obligations already incurred.

So yeah, a clean debt ceiling bill would be ideal. And that's the problem; there isn't one. It's the debt ceiling increase plus all the other shit the Republicans want, too. They said this from the very beginning when they opted to put it up for a vote. We must give them what they want if we want the needed increase or to hell with the economy.

And since anti-science, conspiracy prone hacks have infected the Republican party, there's also quite a few House Republicans that have said they do not want to increase the debt ceiling. At all. They've been publicly saying this, repeatedly, for weeks now. They believe that defaulting won't hurt our economy, and a few idiots like Darrell Issa insist that it's all part of a conspiracy; that Aug 2 is a manufactured deadline established to benefit Obama blah blah... something about Ramadan. It was spectacularly retarded. Paul Ryan, some former economic advisers of Reagan and Bush couldn't even sway them...

Accepted process? This whole fiasco is unprecedented.

happy jack wrote:

Obama said that the sky was set to fall on May 16 of this year.
Based on the latest reports, it is still up there.

So you're in the "it ain't gonna hurt us" crowd with Bachmann et al.? That's fantastic!

Yes, it's still there. That's because we're borrowing money from our federal pensions so we can pay our obligations during the extensions. That runs out next month; that's where the August deadline came from.

You really haven't researched this at all, have you?

Heretic wrote:

happy jack wrote:

Obama said that the sky was set to fall on May 16 of this year.
Based on the latest reports, it is still up there.

So you're in the "it ain't gonna hurt us" crowd with Bachmann et al.? That's fantastic!

Yes, it's still there. That's because we're borrowing money [b]from our federal pensions so we can pay our obligations during the extensions. That runs out next month; that's where the August deadline came from.

You really haven't researched this at all, have you?

In fact,earlier in the thread I pointed out to BWG that there were specific reasons why we haven't defaulted yet.
Here's another source: U.S. hits debt limit and takes actions to postpone a default

Heretic wrote:

So yeah, a clean debt ceiling bill would be ideal. And that's the problem; there isn't one. It's the debt ceiling increase plus all the other shit the Republicans want, too. They said this from the very beginning when they opted to put it up for a vote. We must give them what they want if we want the needed increase or to hell with the economy.

So, apparently, you support the current tax, tax, tax, spend, spend, spend, approach to our economic situation?

BigWhiteGuy wrote:

Heretic wrote:

So yeah, a clean debt ceiling bill would be ideal. And that's the problem; there isn't one. It's the debt ceiling increase plus all the other shit the Republicans want, too. They said this from the very beginning when they opted to put it up for a vote. We must give them what they want if we want the needed increase or to hell with the economy.

So, apparently, you support the current tax, tax, tax, spend, spend, spend, approach to our economic situation?

What part of the following statement don't you understand?

Quote :

The debt limit does not control or limit the ability of the federal government to run deficits or incur obligations. Rather, it is a limit on the ability to pay obligations already incurred.

Here's another poll that shows what the American people think about the proper way to reduce the deficit...

I'm blue.