Thursday, July 14, 2011

Debt Talks - Why the GOP Won't Budge and Why We are in Trouble

It is understandable why President Obama is frustrated with the debt ceiling talks.  He is dealing with a modern version of the Roman god Janus.  Janus had two faces one looking to the future and one to the past.  The GOP has two faces as well, one the more rational conservative like Mitch McConnell (R, KY) and the other the far less rational Tea Party face of Eric Cantor (R, VA). 

The whole thing boils down to politics, but the most risky kind imaginable.  Right now Moody's, the credit rating service, has said it may downgrade US securities.  That would be a real blow to a slow recovery.  It would mean higher interest rates and a loss of confidence from our lenders, like China who has already warned against defaulting on our debts. Yet apparently that means nothing to the Tea Party. 

The problem is the Tea Party folks have little grasp of the realities and complexities of how our economy works.  To them it's just a simple balance sheet of income and debt.  Well as any company accountant will tell you, that might work fine for a check book, but things are far more complicated in the world of big money.

The more rational conservatives know we have to raise the debt ceiling in order to keep growing and to eventually grow our way out of our recession. They raised the debt ceiling several times without a whimper during the Bush administrations and never gave it a second thought.  Now that they are out of power things have changed?  Not really, only the players names and parties. 

The GOP sees a chance to make political hay out of this and the Tea Party has caught on to it and rather than seeing it as a tactic, they see it as a line in the sand.  They have been watching way too much Fox News, and have lost their grip on reality.  That is evident when complete whack-jobs like Michele Bachmann can be considered presidential material.  The unfortunate thing is the GOP embraced the Tea Party folks figuring they could be reigned in and join the fold.  They can't.

It all reminds me of the point when the GOP decided to play to the evangelical crowd.  The fundamentalists had been quietly practicinig their brand of religion for a while and no one gave them a second thought. The GOP saw them as an opportunity and courted their leaders forming the inappropriately titled "moral majority".  That dance with the devil brought a radical edge to the Republicans that still exists, only now it takes the face of Tea Baggers. 

Obama has his work cut out to negotiate with this modern day Janus.  Once face looking to conservative principals and the other glued to Fox News.  God help us all!

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