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Warren: Republicans Want the Fed to ‘Raise Interest Rates and Put Millions of People out of Work’
Breitbart ^ | 10/17/2022 | Ian hatchett

Posted on 10/17/2022 6:49:34 PM PDT by ChicagoConservative27

On Monday’s broadcast of CNN’s “The Lead,” Sen. Elizabeth Warren (D-MA) claimed that Republicans are the ones who want the Federal Reserve to engage in interest rate hikes that will “put millions of people out of work.”

Warren said, “I just want to say here, it’s the Republicans who are trying to keep 43 million Americans from getting their student loan debt canceled. It is Republicans who want to repeal the laws that we just got in place to cut the cost of insulin and to let Medicare negotiate drug prices. It’s the Republicans who want to see us raise interest rates and put millions of people out of work. So, I am very worried about buzzkill. I am worried about what it is the Republicans want to do to an America that really — what we’re trying to do as Democrats is just build opportunity, just let families get out there and do what they do best, let individuals get out there and do what they do best and let them make their own decisions, including letting women make their own decisions about abortion and about their health care. To me, that’s the heart of what it means to be an American and to be optimistic about the future we’re building.”

(Excerpt) Read more at breitbart.com ...


TOPICS: Business/Economy; Culture/Society; Government; News/Current Events
KEYWORDS: fed; highcheekbones; republicans; warren; work
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To: central_va

We are already in a recession. Were you applauding the Fed for QE that has seen the national debt increase from $10 trillion in 2010 to $31 trillion today? The Fed holds almost $9 trillion in T-bills. They printed so much cheap money to keep interest rates artificially low and incentivize deficit spending.

You offer no solution to control rampant inflation. Do you trust the Biden brain trust to do the right thing. How is that Inflation Reduction Act working for you?

The Fed must get inflation under control. Raising interest rates worked for Volcker. It set the stage for the Reagan decade long economic boom. Biden kept Powell on at the Fed. Now he is stuck with him.


61 posted on 10/17/2022 8:33:41 PM PDT by kabar
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To: ChicagoConservative27

Dear Senator Warren: You voted for and the Democrats voted for the policies which have led to this. Biden signed them into law. Republicans were not involved. The Fed is reacting to the inflation accordingly - not “the Republicans” who do not control the Fed.

Have a nice day.


62 posted on 10/17/2022 8:39:45 PM PDT by Republican Wildcat
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To: ChicagoConservative27
"Republicans who are trying to keep 43 million Americans from getting their student loan debt canceled."

I'd like to know where she gets this stuff. Biden?
63 posted on 10/17/2022 8:48:23 PM PDT by clearcarbon (Fraudulent elections have consequences.)
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To: ChicagoConservative27

Princess Stinky Beaver beat War drums


64 posted on 10/17/2022 8:51:18 PM PDT by digger48
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To: kabar

“Were you applauding the Fed for QE that has seen the national debt increase from $10 trillion in 2010 to $31 trillion today?”

The Fed has no control over the national debt. That is entirely up to Congress.

“and incentivize deficit spending”

Deficit spending is Congress spending more than tax receipts take in. That’s entirely their decision. Congress raises the debt limit and the Treasury sells bonds. The Fed is not involved in those decisions. They may have had some influence when the dollar still had a link to gold but that’s long gone.

“The Fed must get inflation under control. Raising interest rates worked for Volcker. It set the stage for the Reagan decade long economic boom.”

Killing inflation took more than just Volcker choking off credit. It required Reagan’s program that unleashed the supply side of the economy, and especially deregulated energy. We need a Reagan style administration to replace the Carter 2.0 administration of Joe Biden.


65 posted on 10/17/2022 8:53:13 PM PDT by Pelham (World War III will be fought with nuclear weapons. World War IV will be fought with rocks & sticks.)
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To: Pelham
Deficit spending is Congress spending more than tax receipts take in. That’s entirely their decision. Congress raises the debt limit and the Treasury sells bonds. The Fed is not involved in those decisions. They may have had some influence when the dollar still had a link to gold but that’s long gone.

Are you serious? The Fed sets the interest rates, which determines the annual debt servicing costs for the national debt. Interest costs were $352 billion in 2021, and are projected to rise to $1.2 trillion by 2032.

One of the most damaging effects of rising debt will eventually be rapidly growing interest costs. As the national debt grows and interest rates rise from their current low levels, the United States will spend more of its budget on the cost of servicing that debt — crowding out opportunities to invest in the economy. Additionally, interest costs will become the fastest-growing component in the federal budget and will total $8.1 trillion in the next 10 years alone, according to CBO.

Inflation’s legacy of higher real interest rates poses a significant danger to the federal budget. Indeed, the surprising three-decade decline in interest rates has been the main reason why spiraling federal debt has not yet induced the debt crisis that economists have long warned. Between 1997 and 2021, the national debt held by the public leaped by nearly 500 percent, from $3.8 trillion to $22.3 trillion. Yet the annual net interest costs to the federal government rose by only 44 percent, from $244 billion to $352 billion. Had the 1997 interest rate continued, today’s annual interest expenses would be $1 trillion higher (or more, given the larger national debt accumulated from decades of higher interest costs).

Instead, falling interest rates minimized budget deficits, and fed the misconception that government debt is essentially free. For the past few years, short-sighted lawmakers, economists, and columnists have demanded that Congress take advantage of low interest rates by engaging in a massive borrowing spree. Indeed, President Biden’s enormous spending agenda was often justified by the low interest rates on government borrowing.

Unfortunately, we are now getting a taste of the federal cost of higher interest rates brought by inflation. In early 2021, CBO projected that the average interest rate paid by Treasury on the federal debt would gradually rise from 1.5 percent to 2.4 percent over the next decade. Now, they project that rate to rise to 3.1 percent over that period. As a result, the latest CBO budget baseline forecasts that, a decade from now, the $1.2 trillion cost of annual federal interest payments will exceed the defense budget, and represent a record −3.3 percent of the economy. And that is the rosy scenario of a strong economic recovery, no new spending expansions, and the 2017 tax cuts expiring on schedule.

What if the government’s interest rate surpasses the CBO’s projected 3.1 percent rate a decade from now? Each additional percentage point would cost the federal budget $2.6 trillion over the decade, and $400 billion annually by 2032. That would far exceed the cost of the 2017 tax cuts, and approach the cost of President Biden’s original Build Back Better proposal. It would be enough money to double federal spending on veterans’ health care as well as highways and transit, and still offer families a $300 annual tax rebate. Instead, that taxpayer expense would merely pay bondholders. And that is all from just one percentage point in higher interest rates.

Alternatively, an interest rate rise of two percentage points over the baseline would bring $3 trillion annual budget deficits within a decade even with peace, prosperity, and no new federal initiatives.

The long-term cost is even more dire. Over the next three decades, interest rates exceeding the CBO projection by even one percentage point would add $30 trillion in additional interest costs — which is the equivalent of funding an additional defense department. Within three decades, interest would consume 70 percent of annual taxes, drive budget deficits to 18 percent of the economy, and push the national debt to nearly 250 percent of the economy. Additional rate increases would produce dramatically worse results.

Instead, Washington is gambling its fiscal future on the hope that interest rates paid on its debt will never again reach levels like the five percent rate that prevailed as recently as 2008. And there is no backup plan if interest rates rise. If the debt truly expands by $114 trillion over the next three decades, as projected in the CBO baseline, then any small interest rate rise will bring enormous costs. And the Social Security and Medicare shortfalls driving this baseline debt surge will not be easily reversible with 74 million retiring baby boomers reaching their 70s and 80s over that period and increasingly unable to absorb any significant reforms to these programs.

66 posted on 10/17/2022 9:25:49 PM PDT by kabar
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To: ChicagoConservative27

No Lizzie...you and your hord are doing a smashup job of that ALL BY YOURSELVES. You require no help from Mitch...although Im sure he’d have no scrupples against doing your bidding if it lined his wallet.


67 posted on 10/17/2022 10:28:25 PM PDT by griffin (When you have to shoot, SHOOT; don't talk. -Tuco)
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To: ChicagoConservative27

Warren’s knowledge of matters economic stops at wampum.


68 posted on 10/17/2022 10:33:35 PM PDT by chuckee
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To: central_va

Not true at all-dozens of conservative business people/commentators have been on Fox Business saying the Fed is going too far

Powell was re-appointed by Biden and it the Dem fiscal policy (spending increases M2 money supply) that makes it hard to not raise rates

This one is all Dems


69 posted on 10/17/2022 10:37:02 PM PDT by TECTopcat
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To: ChicagoConservative27

An idiot and fool, who is responsible for the mess we are in


70 posted on 10/17/2022 10:47:49 PM PDT by KC_Conspirator
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To: FlipWilson

Yeah, thats pretty much it


71 posted on 10/17/2022 10:48:19 PM PDT by KC_Conspirator
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To: ChicagoConservative27

Fauxcahontas needs to go chew on a buffalo skin for a while.


72 posted on 10/17/2022 10:52:23 PM PDT by FlingWingFlyer (Veto Beto, FJB.)
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To: ChicagoConservative27

The same people thinking they can control the climate by restricting usage with regulations and higher prices for energy, are now thinking they’re going to control inflation using regulation and higher prices for energy.


73 posted on 10/17/2022 11:12:40 PM PDT by lewislynn (Trump accomplished more in one term than any other President in your lifetime.)
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To: ChicagoConservative27

Congress could easily resolve the problem they created by not spening that $4.6 trillion in extra spending.


74 posted on 10/17/2022 11:43:38 PM PDT by minnesota_bound (Need more money to buy everything now)
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To: ChicagoConservative27

hag witch needs to be burned at the stake just to shut her up


75 posted on 10/18/2022 1:34:53 AM PDT by ronnie raygun
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To: ChicagoConservative27

Wont some of the layoff be republicans? Yes. Do some of us still want to see Biden’s handiwork cripple the nation to the point his party is in ruins? Yes


76 posted on 10/18/2022 3:07:05 AM PDT by MrRelevant
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To: ChicagoConservative27

A lot of people simply believe what is said on TV and parrot it as though it’s fact.


77 posted on 10/18/2022 5:04:38 AM PDT by Preachin' (I stand with many voters who will never vote for a pro abortion candidate.)
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To: joe fonebone

How was i wrong? I said it’s going to take adults to fix this. Adults who see the truth of our situation and have the maturity and judgement required to make difficult decisions that must be made in the face of calamity.

I never said there would be a soft landing.


78 posted on 10/18/2022 5:58:19 AM PDT by Nathan _in_Arkansas (Hoist the black flag and begin slitting throats. )
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To: kabar
To control rampent inflation:

Re-elect TRUMP. Re do MAGA. PERIOD.

Only a f---ing troglodite wants to crater the economy on purpose. Go find another patient to bleed. A pox on all houses.

79 posted on 10/18/2022 6:16:15 AM PDT by central_va (I won't be reconstructed and I do not give a damn...)
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To: kabar
Raising interest rates worked for Volcker.

It didn't work for me and a lot of engineering types GD it. I lost everything. Getting laid off in 1981 was worse than a death of a loved one, worse than anything. So f off.

80 posted on 10/18/2022 6:18:12 AM PDT by central_va (I won't be reconstructed and I do not give a damn...)
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