I don’t know about the rest of you folks, but I’m feeling depressed about this debt limit debacle that is soon to be upon us. I won’t even dignify it with the word “crisis” because this is completely manufactured by the Republicans. Yes, this debt limit debacle is Republican hostage taking at its finest, but I’m afraid that the hostage (the economy, or what is left of it) will come out of this very much dead no matter what happens.
For now, I see only two scenarios:
1. Democrats cave again and give the Republicans everything they want – trillions in spending cuts, especially in Medicare, Medicaid, and Social Security. Also, no tax increases whatsoever. The spending cuts kill off this so called “recovery” we are in, and unemployment rises sharply. Democrats get the blame for tanking the economy AND piss off the Democratic base with the spending cuts. Democratic voters stay home again in the next election, and Republicans win the Senate and White House in 2012.
2. Republicans continue to move the goal post with regards to spending cuts until time for raising the debt limit is past. The U.S. defaults, and the economy joins the Titanic at the bottom of the Atlantic. In other words, Republicans blew the hostage’s head clean off. As for the political fallout, who really knows?
Why the political unknowns on scenario #2? Normally, if we had a working two party system, one party could blame the other for its political and economic stupidity. Given the glee with which Republicans are salivating over the destruction of the U.S. economy, it should be a no brainer for a competent Democratic Party to pin all the political fallout for U.S. default on the Republicans.
Too bad a competent Democratic Party does not exist.
As I am writing this blog, Congressional Democrats are scrambling to perform scenario #1. Democrats are stupid enough to believe that they will win browny points with the American voter by being the “adults” and making the least painful scenario happen. I can see the campaign ads now, “We had to tank the economy and cut your Social Security to save the full faith and credit of the United States.”
When my elderly mother takes a hit in her Social Security check, she is not going to be saying, “Thank God the Democrats saved the full faith and credit of the United States!” Nor will the other folks who loss their jobs because of said budget cuts be saying, “Go Democrats!” Remember, we are dealing with Americans, and their grasp of economics is non-existent to say the least. All Americans will see is rising unemployment and lower median incomes, except for the wealthy that is. Telling your average American that things would have been worse with a U.S. default will work as well as the timid stimulus of 2009 did for Democrats in the 2010 elections.
You all can see those lame Democratic ads for 2012. Right?
There is a third scenario, but it won’t happen: Obama invokes the 14th Amendment to raise the debt limit on his own. In order to do that, Obama would need to do something that he does not have the capacity for – be a risk taking leader on a major domestic issue. Yes, Obama can kill terrorists as long as he has the might of the U.S. military behind him, but take on entrenched domestic adversaries with loads of corporate power behind them? Forget it!
So you can see why I am feeling a little blue right about now. There is that third option, but Obama won’t have the guts to do. There is a way out, but he will not take that road. Instead, we will have a repeat of the 2010 election cycle. Only this time, Obama will be up along with the rest of the Democrats.
So I ask you other firedoggers: what can or are we going to do when either scenario plays out?