My 2 1 Cents

I’m going to add my penny to the Debt Limit fiasco. You would think that this is the first time that we raised the debt limit, but we have raised it many times before…

• Ronald Reagan’s First Term – $656 billion increase
• Ronald Reagan’s Second Term – $1.036 trillion increase
• George H.W. Bush’s Term – $1.587 trillion increase
• Bill Clinton’s First Term – $1.122 trillion increase
• Bill Clinton’s Second Term – $418 billion increase
• George W. Bush’s First Term – $1.885 trillion increase
• > George W. Bush’s Second Term – $3.014 trillion increase
• Barack Obama’s First “Year” – $1.573 trillion increase

From “The National Debt Crisis”

OK, so what is different this time?

Well for one thing the culmination of all the debt from the other presidents, especially the Republican presidents. President Clinton cut the debt limit increases by almost two thirds in his second term, unlike the Republican presidents that increased their debt limit more in their second term. The other thing that has caused the gridlock is the ideology of the Tea Party that want to gut the government.

zFacts’ graph shows the since World War II, the debt was decreasing ever since the end of WW II until President Regan, were it started to increase. The amount of debt limit increases started decrease again under President Clinton and then the debt limit increases skyrocketed under President Bush. The Atlantic Monthly has two good charts in the article "The Chart That Should Accompany All Discussions of the Debt Ceiling", one that compares President Bush’s budget to that of President Obama budget…

Notice that in the Bush budget, over $1.8 trillion dollars was from the Bush’s tax cuts to the billionaires and millionaires. The other graph shows the roots of the deficit…

Part of the problem is the wars that we are fighting in Iraq and Afghanistan, part of the problem is the recession, but the real problem is the Republican’s tax cuts to the billionaires and millionaires. In the zFacts graph look at how the debt increased during the Bush administration as a result of the tax cuts. We will never bring the debt under control unless we look at increasing taxes on the ultra-rich. In an editorial in the Nation called, “Debt Ceiling Delusions” they write,

The Republicans have once again shown themselves to be a party, to paraphrase Nobel laureate Joseph Stiglitz, of the 1 percent, by the 1 percent, for the 1 percent. It is a party that accepts no new taxes, no closing of loopholes, no crackdowns on overseas tax havens and no increase in corporate tax rates, even as the biggest corporations pay little or no taxes on billions in profits. It is a party that embraces savage cuts in the social safety net but then draws a line in the sand to protect the wealthy. To Republicans, shared sacrifice is anathema. Now, as before, the global economy may be their victim.

It is the Tea Partiers ideologues that are holding the economy as hostage in order for them get their way to strip the poor and middle class their safety net. The Tea Party have stated many times that they want smaller government by doing away with the EPA, OSHA, FDA and the SEC. They also want to privatize Social Security so that their billionaire friends can get commissions from the retirement accounts.

What do the people want? A Pew poll found that,

The public overwhelmingly favors a compromise in the debt ceiling standoff. And even as negotiations aimed at resolving the issue show little progress, a majority thinks that Barack Obama and congressional Republicans will reach a deal before the Aug. 2 deadline on a possible government default.
[…]
In keeping with their desire to see compromise, there is no change in the public’s view that the best way to reduce the federal budget deficit is through a combination of both cutting major programs and increasing taxes. Six-in-ten (60%) say that both are in order; just 19% say that the focus should be mostly on cutting major programs while even fewer (8%) say the focus should be mostly on raising taxes. The proportion supporting a mixed approach of funding cuts and tax increases is about the same as it was last December (65%).

The public says that it wants a mixed approach, while the Tea Party fraction of the Republican party still hold fast to their rallying cry “No Tax Increases” even as the nation crumbles around them. However, they are willing to cut Medicare and Medicaid which will results in millions of seniors and low income people paying more money, which to them is really a tax increase.

The Pew poll asked if the Tea Party was willing to compromise on the debt…

When asked which political party is more extreme in its positions, 50% say the Republican Party while 35% say the Democratic Party.

I am worried about the effects that default will have on retirement accounts that I am living off and I am not alone, the poll found

Most Americans feel a personal stake in the efforts to resolve the debt ceiling impasse. Nearly two-thirds (65%) say their own personal finances would be affected by a failure to increase the government’s ability to borrow; 32% say their finances would not be affected. More specifically, 45% are worried that a failure to meet the Aug. 2 deadline would harm their investments and retirement savings, and 46% are worried that they might lose government services and benefits that affect them personally.

It is time for the Tea Party to break their deadlock and realize that they have to eliminate some of the corporate loopholes and eliminating exemptions on luxury items.