Tag: Debt

As if you need any MORE reasons to vote Democratic up and down the ballot both this November and next November, check out this...

When he claims the president has doubled the deficit, Mitt Romney is an extreme  liar.

First, as the graph shows, the President has reduced the deficit. The Red column on the graph represents George W. Bush's contribution to the deficit. But serial liar Romney falsely claims Obama has doubled the deficit.  Not only has the president NOT doubled the deficit, the president has reduced it. The data are clear. Barack Obama has reduced the deficit more than two Bushes and more than Ronald Reagan. In point of fact, only Bill Clinton and Barack Obama have actually reduced the deficit.  

But as Rachel Maddow discussed today, amazingly Mitt Romney supposedly has more supposed "cred" on the matter of deficit reduction.  The new Washington Post poll shows that is the only element upon which Mitt Romney does better than the President.  

Congress has been unable to pass a deficit reduction plan because Republicans steadfastly refuse to raise taxes on the wealthy. Democrats have put discretionary spending, the social safety net, and even the short-term health of the economy on the table, but the GOP will accept no deals. That's why the Gang of Six broke down in May. That's why talks between President Obama & John Boehner went nowhere in July. That's why the Deficit SuperCommittee defaulted to automatic cuts to discretionary & defense spending in November. Yes, Republicans would rather risk re-election on charges of being weak on national security than raise taxes on the ultra-wealthy. So why would they rather do so something so thankless as cut the long-term deficit than raise taxes on the ultra-wealthy?

Yet long after Washington has moved on to extending the payroll tax cut & discussing the best ways to create jobs, Sen. Mark Warner (D-VA) is continuing his deficit crusade:

Virginia U.S. Sen. Mark Warner won't relax until significant federal debt reduction is accomplished. "This is whether Congress is up to governing and knocking $4 trillion off the debt. It's not curing cancer and it's not defeating Communism. But until we get this dealt with, we can't do anything else," Warner said.

Congress IS doing other things. It's working on extending payroll tax cuts and unemployment insurance. President Obama has begged Congress to pass his American Jobs Act to raise taxes on the wealthy to put people back to work.

But instead of cutting his losses, Warner is still investing his time in the failed Gang of Six:

Earlier this evening, Standard and Poors downgraded the U.S. long-term sovereign credit rating from AAA to AA+. Why? S&P's reasoning says it all:

*"We lowered our long-term rating on the U.S. because we believe that the prolonged controversy over raising the statutory debt ceiling and the related fiscal policy debate indicate that further near-term progress containing the growth in public spending, especially on entitlements, or on reaching an agreement on raising revenues is less likely than we previously assumed and will remain a contentious and fitful process."
In other words, the Republicans and Tea Partiers holding the debt ceiling increase hostage to their demands did not go over well with Standard and Poors. Shocker! (not)

*"We also believe that the fiscal consolidation plan that Congress and the Administration agreed to this week falls short of the amount that we believe is necessary to stabilize the general government debt burden by the middle of the decade."
Again, thank you Teapublicans for absolutely refusing to touch the revenues side of the equation. In fairness, Democrats weren't exactly jumping up and down to deal with health care spending; also, Democrats should have pushed much harder for a public option when they had a chance, as this would have helped "bend the cost curve" of health care spending. But nooooo....

*"The political brinksmanship of recent months highlights what we see as America's governance and policymaking becoming less stable, less effective, and less predictable than what we previously believed."
Political brinksmanship?  Gee, who could S&P possibly be referring to on that one? Hmmmm.

*"It appears that for now, new revenues have dropped down on the menu of policy options... only minor policy changes on Medicare and little change in other entitlements, the containment of which we and most other independent observers regard as key to long-term fiscal sustainability."
In this case, there's blame to go around, as neither party was serious - with the exceptions of President Obama and, apparently, John Boehner before he was reined in by his own caucus - about dealing with entitlements. And no, the Ryan Plan, which most every Teapublican voted for, does not count as "serious." It's a complete joke.

*"...our revised base case scenario now assumes that the 2001 and 2003 tax cuts, due to expire by the end of 2012, remain in place. We have changed our assumption on this because the majority of Republicans in Congress continue to resist any measure that would raise revenues, a position we believe Congress reinforced by passing the act."
This one's clearly the Teapublicans' fault, essentially 100%, and is a big part of the reason why S&P believes the U.S. is not "likely to slow the deterioration of the government's debt dynamics."  In short, thank you, Teapublicans, for destroying America's credit rating!

UPDATE: This sums it up very well. Also, Matthew Yglesias has some thoughts.

A few minutes ago, the U.S. Senate voted 74-26 to approve the debt ceiling deal reached this past weekend. Both Jim Webb and Mark Warner voted "aye." Below, watch Mark Warner explain his thinking on the debt ceiling deal, his "aye" vote, and also his belief in the need for a "full, long-term solution...to get our debt-to-GDP ratio back in line."

P.S. There's a rumor floating around on some of the (far, far!) right-wing blogs, that Mark Warner supposedly won't be running for reelection in 2014. I just checked with Warner's office, and spokesman Kevin Hall told me that is "[c]ompletely not true".

I just received this statement from Rep. Jim Moran. I think it's fair to say that most Blue Virginia readers strongly agree with what Rep. Moran has to say on this issue!

Moran Statement on the Debt Ceiling Deal

Washington, DC - Congressman Jim Moran, Northern Virginia Democrat, released the following statement in advance of the House vote on the debt ceiling proposal:

The debt ceiling has been raised cleanly 39 times over the last 30 years, 18 times by President Reagan alone. But for the first time ever, a deal has had to be negotiated to raise the debt ceiling and prevent a default. Unfortunately, the proposal we are being asked to vote on would be bad for our country. It should be rejected, and President Obama should take matters into his own hands by invoking the 14th Amendment to raise the debt ceiling.

This deal is not representative of a balanced approach to long-term deficit reduction. By leaving revenue entirely off the table, the agreement severely restricts the government's ability to make investments in the human and physical capital of this country - investments that created the strongest middle class in the world and made our country the most powerful.

At a time of stagnant growth and high unemployment, the far-right of the Republican party has been able to hold our economic security hostage in exchange for deep cuts that will reduce growth and employment and increase inequality in the short term without properly addressing the structural causes behind our long-term deficits.

I called the office of my Congressman, Rep. Jim Moran, today to ask him to vote against the debt ceiling deal. The GOP got 98% of what they wanted in this deal - let them vote for it. What about the threat of default? Would you rather see the economy & seniors take a short-term hit through default, or watch the economy, seniors, education, transportation, and regulatory protections all suffer permanent hits under this deal? And considering the stock market is down this morning, I question whether we'll even be any better off in the short-term under this draconian 98% GOP plan.

Barack Obama lost a battle everyone saw coming but him. If I was Barack Obama, I would immediately propose a plan to reduce the deficit & revitalize the economy that would:

• Immediately end the Bush tax cuts on income over $250,000
• Create a low tax on carbon pollution from the biggest emitters that's gradually ratcheted up over time 
• End key subsidies for Big Oil, corporate jets, etc. 
• Use much of the revenue to fund transportation projects, unemployment insurance for the long-term unemployed, and any from a list of dozens of job-creating projects
• Use the rest of the revenue to reduce the deficit by billions of dollars

Would Republicans immediately block it? Of course. But poll after poll shows this is exactly what the public wanted in a balanced deal and got left out. Let Republicans explain to the public why they're voting to fully preserve tax cuts for the rich instead of putting people to work fixing roads and bridges in their own districts.

If the president continues to let Republicans drive the narrative of cut, cut and cut as the economy continues to slide, it's hard not to see a Republican president & a Republican Congress being swept into office in November 2012 by voters tired of a president not just unable to create jobs for American workers, but apparently unwilling to go to war for them.  

The latest news in the utterly absurd, degrading (to the United States of America) debt ceiling follies? This just in!

*Senate Blocks Reid's Debt Ceiling Plan; Talks Continue

But wait, it's our friendly Kentucky Republican Mitch McConnell to the rescue! (snark)

*White House, McConnell 'very close' to debt deal ("The first stage would pair an increase of roughly $1 trillion with cuts to government agencies of about the same magnitude over the next decade. In the second stage, a special congressional committee would be created to identify additional savings later this year. The size of those savings would dictate the size of the second debt-limit increase, giving Republicans the dollar-for-dollar matchup they have demanded between spending cuts and the debt-limit increase.")

Great stuff, huh? I think I'm going to go watch a movie for a while and escape from all this idiocy. Feel free to use this as an open thread to discuss the debt ceiling fight, and whatever else is on your mind. Thanks.

P.S. I just did a quick calculation, and found that Democratic votes fell off 32.9 million between 2008 and 2010, while Republican votes fell off only 21.2 million votes. That's what gave us the Teapublican'ts in control of the House, and much of the ridiculous situation we now find ourselves in. Great job to all the Obama '08 voters who didn't bother to show up and support him in '10. Not!

With news that Republicans are looking to make the Boehner plan to kill 700,000 jobs even worse, David Kurtz at TPM writes:

First quarter GDP revised downward to a 0.4 percent growth rate. Second quarter GDP grew at a lower-than-expected 1.3 percent.

Let's go ahead and suck some more demand out of the economy by cutting government spending. But first, it'd be a good idea to roil the credit markets by flirting with government default.

Anything we're leaving out of this recipe for disaster?

At The Plum Line, Adam Serwer wonders why Democrats seem to have given up on any effort to preserve or create jobs.

A new analysis by Moody's confirms the Republican plan to slash spending would devastate America's economy:

The report, by Moody's Analytics chief economist Mark Zandi, offers fresh ammunition to Democrats seeking block the Republican plan, which would terminate dozens of programs and slash federal appropriations by $61 billion over the next seven months.

Zandi, an architect of the 2009 stimulus package who has advised both political parties, predicts that the GOP package would reduce economic growth by 0.5 percentage points this year, and by 0.2 percentage points in 2012, resulting in 700,000 fewer jobs by the end of next year.

His report comes on the heels of a similar analysis last week by the investment bank Goldman Sachs, which predicted that the Republican spending cuts would cause even greater damage to the economy, slowing growth by as much as 2 percentage points in the second and third quarters of this year.

How many jobs would Sen. Harry Reid's plan cost? I haven't seen an analysis - if you have, please post it in comments. But as E.J. Dionne points out, Democrats are caught in the Beltway Deficit Feedback Loop - focused exclusively on cutting spending while Americans continue to be most worried about jobs & the economy.