Posted on 05/24/2023 7:37:13 AM PDT by SeekAndFind
The rollercoaster debt-ceiling talks are back at a stalemate amid a full-throated effort by the most conservative members of Kevin McCarthy’s caucus to preemptively kill any bipartisan deal.
Influential Rep. Chip Roy (R-TX) told a right-wing host Tuesday night that “my position is to hold the damn line” and force a GOP-only plan into law, one of the many similar comments from Republicans in recent hours.
“I don’t even care about the negotiations going on at the White House,” he added.
The GOP's internal dynamics are having a direct effect on the talks. House Speaker Kevin McCarthy abruptly shifted his tone Tuesday just hours after optimistic comments in the Oval Office.
Late Tuesday night, a lead member of McCarthy’s negotiating team told reporters that talks were now off unless they see “fundamental change” from the White House.
The conservative rebellion is a mirror of sorts to what President Biden is confronting on his left flank, with many Democratic lawmakers similarly skeptical of concessions.
The unrest on both fringes is raising new questions not just if a deal can be struck — but whether it could then even pass Congress in time to avoid a potential default on June 1.
For now, many in the business world are still planning for compromise. CFRA Research Chief Investment Strategist Sam Stovall told Yahoo Finance Tuesday “most people on Wall Street think that cooler minds will prevail.”
But he added a warning: “should the worst happen, history then tells us, watch out because we could enter into a new bear market.”
The conservative distaste surfacing online and in person reflects the official position of the powerful House Freedom Caucus.
(Excerpt) Read more at finance.yahoo.com ...
Mind you, there are a few million seniors cognizant of how phooked they will be if this circumejaculatory circus sits on their hands, and we are not at all pleased.
“Default Prevention Act of 2013”
“(b) Certification.—Not later than 3 days after the date of enactment of this Act, the President [Barack Obama] may submit to Congress a written certification that absent a suspension of the limit under section 3101(b) of title 31, United States Code, the Secretary of the Treasury would be unable to issue debt to meet existing commitments.”
https://uscode.house.gov/view.xhtml?path=/prelim@title31/subtitle3&edition=prelim
The certification by President and former constitutional law professor Barack Obama under a law passed by a Senate presided over by Vice President Joe Biden is basically a legal admission that Joe Biden’s Amendment XIV plan is not legally permissible.
Default is scare word meaning late payment.
It is important to realize that federal finances are not the same as those of a business.
The federal government has the 110-year-old might of the Internal Revenue Service at its command.
A business is dependent on faith, goodwill, and most of all, a track record of timely payment.
A business can’t borrow money based on the force of law.
Congress has the Article I, Section 8 power to borrow money, including percentages of new bank-issued certificates of deposit (say 80% of 1% or less CDs sliding down to 20% of 4% CDs).
Congress could reduce the FDIC insurance maximum to steer money in search of loans towards the Treasury rather than to banks.
Probably, but the game plan seems to be a “soft default” of just continuing to debase the currency so that we can pay (or at least service) the debt with dollars that are worth much less than when we took on the debt.
Social Security and Medicare have their own trust funds holding trillions in federal debt that can be sold for say 99% of face value by hospitals, drug companies and financial intermediaries such as JP Morgan or your bank (or given to states as loan security).
Let us say $8 billion in Social Security has to get paid for Floridians 65 or more in June 2023. The Social Security Old Age Trust Fund could entrust $8 billion in federal debt securities to Florida, which would borrow money on such security then place the borrowed money belonging to the State of Florida in a bank account the Social Security administration would write payments from. When the matter is resolved, Congress would buy back the securities and Florida would repay the borrowed money.
Medicare could be made to function in a like manner, but hospitals, doctors and drug companies have enough financial size to be able to take payment in federal debt securities directly, which they could borrow on or sell off at a slight discount.
“Soft default” has caused higher mortgage rates.
Mortgage rates will remain high unless Republicans can rein in the federal spending monster.
Default will probably cause a spike in rates, but it will be short lived if there is bipartisan acceptance of the very reasonable McCarthy plan. Many people wanting to buy a house are now waiting out absurd house purchase pricing so such a spike won’t harm them, but will probably help the people needing reasonable house prices by making their waits shorter.
The Center for American Progress runs Biden. That is where KJP is from. They HATE America.
“If the debt keeps rising, won’t the US have to default at sometime?”
No, not as long as congress continues to increase it’s borrowing capacity substituting wants for worth. They just change the worth as debts are established at one level and the new debt capacity is re-established so the bills appear to get smaller. They still exist, just at a lower level than any new debts will be established as they are left under the old appearance. If the past debts were raised to the new debt level, they would be astronomical. They only depreciate down, not up. Up doesn’t get people to vote for you because voters pay the difference along with the bill.
wy69
“The unrest on both fringes is raising new questions not just if a deal can be struck — but whether it could then even pass Congress in time to avoid a potential default on June 1.”
Here’s a clue for the hair-brained Yahoo Washington correspondent. It already passed Congress and is in Schmucky’s lap.
Why oh why is the senate not debating and considering it? Is Schmucky worried it will pass? Is he worried that SloJoe will veto it? Is he afraid it won’t pass and all blame will be placed on the rats? What’s he waiting for? He’s got his two vegetables back and ready to cast a vote.
This theater can only go on for so much longer. McCarthy needs to stand strong and wait for SloJoe and Schmucky to cave. There is no other option.
EC
A few months ago, a very prominent politician (who at the time held no elected office) insisted that McCarthy was a wonderful choice for Speaker, and that those who were holding his feet to the fire should shut up and get with the program.
That politician looks more foolish with each passing day.
Instead, the media only mentions government spending that they know impacts individuals, like Social Security and Medicare. But those programs are supposed to be separated and self-sufficient. They are not, only because we spend billions on politicians pet projects.
If McC were to actually accomplish anything at all of substance I'll eat my shorts.
RE: That politician looks more foolish with each passing day.
OK, what should McCarthy do that he isn’t already doing?
I don’t think Sniffer can say “no”, he can only sign what is in front of him. And, no, I don’t think he in charge of anything.
Anything good that McCarthy is doing (and I’m pleasantly surprised by him so far) is precisely because the Freedom Caucus was and is able to hold his feet to the fire.
We should all be glad that they didn’t just shut up and get with the program, as a certain prominent politician repeatedly and rudely told them to do.
Yahoo news is terrible.
There’s a big fat FBI facility being built that we don’t need. And an education dept. And foreign aid. And non-essential staff.
The House has passed a bill to prevent default. Their job is done. If Biden and the Senate cannot get them to compromise on new terms, they have a choice whether to approve it or allow default.
Anyone asking our grandkids if it’s ok to run up their Credit Card debt?
Grandpa wants T-bone steak for dinner tonight.
The country is entering a serious recession, thanks to Biden. So the left WANTS a “default!” or whatever it is. Then they get to trumpet, “The Republican (caused) Recession!!!” and Biden gets away scott free.
R’s could head it off by screaming, “Biden Recession!!!” NOW, to implant it first, but they won’t. Too skeeeerd. Or too dumb.
Mark. My . Words.
We will hear, “Republican Recession!!!” the day before default, and forevermore. All msm and social media will be screaming the Big Lie, and Rs will get the blame for the coming crash.
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