Posts Tagged ‘debt ceiling’

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Buzzards October 17, 2013

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john-boehner-what-now-494 Martin Rowson 12.10.2013

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Just a reminder, from the last debt-ceiling showdown in the summer of 2011, against the current Republican (and Republican water-pail-carrying) argument that not raising the debt ceiling has no real consequences.*

Back in 2011, the Standard & Poor’s 500 Stock Price Index fell 14.2 percent (from 8 July to 12 August)—not to mention the other events at that time: the downgrade of the U.S. credit rating, the increase in U.S. borrowing costs, and the stock-market meltdown in Europe.

As always, I’m of two minds about this showdown: on one hand, let them lie in the bed they’ve made; on the other hand, the rest of us are under the bed and, if and when it crashes, we’re all going to be hurt.

*And you don’t have to listen just to me. Yesterday, according to the Wall Street Journal, top Wall Street executives were the ones who were “warning that any effort to pay interest on U.S. debt before other obligations such as Social Security, a strategy some lawmakers think would placate bond investors if the government breaches its borrowing limit, would pose severe risks to financial markets and the economy.”

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Debt ceiling fix

Posted: 30 September 2013 in Uncategorized
Tags: , , ,

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In one sense, Henry Aaron is right: the limit on the debt ceiling is “a law with no discoverable purpose.” He suggests, therefore, that Obama ignore it.

But there are at least two other ways to avoid the problem. One is for the Treasury to avoid the federal debt limit by handing the Federal Reserve a single $1 trillion platinum coin. But that’s too easy (even though Jon Stewart didn’t get it). The other is to raise taxes on large corporations and wealthy individuals. Raise them by a lot. Set a marginal tax rate of 100 percent.

That’ll fix the problem almost immediately, since those threatened with paying higher taxes will quickly run to their stooges in Congress and demand they raise the debt ceiling. Anything to avoid paying higher taxes, in order to keep the lion’s share of the surplus in their pockets.