Krugman, Stewart in trillion-dollar coin tiff

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    Re: Krugman, Stewart in trillion-dollar coin tiff

    In response to Jim-in-Littleton's comment:

    In response to slomag's comment:

     

     


    Not really - Obama might come off looking silly in the short run, but he won't be on the ballot, and in this day and age, nobody is going to remember what happened 22 months earlier anyway.  It would basically look to everybody just like it is - rather than doing their job, Republicans took their ball and went home.

     

     

     




     

     

    It wouldn't just be Obama.  Every Democrat that supports him would also have to run against their record of looking silly too.  

     

    And if no one is going to remember it in 22 months, why should the Republicans worry about it either?  The current CRA runs out about 3 weeks after the projected debt ceiling issue hits. That gives Obama 3 weeks to spend that $1 trillion before he's completely cut off...



    It's not the coin that would sink republicans - it's your proposed government shutdown. That's something that would affect voters every day up to the election.  There's a growing perception that Republicans are sore losers - a GOP-led government shut-down immediately following the presiden't re-election will only cement that perception.  

    The GOP had the wind at their backs and public approval on their side in 1995, and they were blamed for the Gov't shut-down (lost 8 seats and Clinton sailed to re-election in 96).  You honestly don't think there would be blowback in 2014?

     

     
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    Re: Krugman, Stewart in trillion-dollar coin tiff

    In response to WhatDoYouWantNow's comment:

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    In response to Jim-in-Littleton's comment:

    And then what?



    Devaluation of currency, inflation, the dollar is no longer a reserve currency, serious difficulty raising future loans. On and on and on.

     


    All sorts of bad things happen if they actually did the coin stunt. Trouble is the things that would happen if the debt limit isn't raised so that already apportioned funds can be spent are far, far, worse. And would have global implications.


    Which is why they will work something out. That or whatever political system ultimately emerges from the ruin and wrack, it won't be Democrats and Republicans.

     



    Krugman argues there would be no real impact - it would just be an accounting trick to avoid the debt ceiling ...

     

    In case you’re wondering, no, this wouldn’t be an inflationary exercise in printing money. Aside from the fact that printing money isn’t inflationary under current conditions, the Fed could and would offset the Treasury’s cash withdrawals by selling other assets or borrowing more from banks, so that in reality the U.S. government as a whole (which includes the Fed) would continue to engage in normal borrowing.

    Basically, this would just be an accounting trick, but that’s a good thing. The debt ceiling is a case of accounting nonsense gone malignant; using an accounting trick to negate it is entirely appropriate.

    But wouldn’t the coin trick be undignified? Yes, it would — but better to look slightly silly than to let a financial and constitutional crisis explode.

     



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    I tend to think the mere act of actually going ahead and doing it would create (1) precedent, and (2) the fear of the precedent being extended in the future, which would end up tipping us to the sorts of problems I identified. For example(s):

    If I was running a country and held huge reserves in another currency, I know I would have serious second thoughts about that if the other country pulled a similar trick. Even if it was done 'properly' one time, how can I trust that will always be the case?

    If I'm going to buy bonds am I going to buy them from a country that just created a trillion dollar coin and said "here you go...pay the bills with this"? Who's to say they won't engage in some other similar trick to pay on my bonds if they run into other, worse trouble by the time they mature?



    I think the precedent of using the debt ceiling in negotiations - or anything with disastrous consequences to the nation - is more dangerous than the actual minting of the coin would be.  

    This is actually the perfect moment for negotiations - close the minting of the coin loop-hole in exchange for abolishing the debt ceiling.  That would be the best thing for the economy all around.

     

     
  3. You have chosen to ignore posts from Jim-in-Littleton. Show Jim-in-Littleton's posts

    Re: Krugman, Stewart in trillion-dollar coin tiff

    In response to slomag's comment:

     

    It's not the coin that would sink republicans - it's your proposed government shutdown. That's something that would affect voters every day up to the election.  There's a growing perception that Republicans are sore losers - a GOP-led government shut-down immediately following the presiden't re-election will only cement that perception.  

    The GOP had the wind at their backs and public approval on their side in 1995, and they were blamed for the Gov't shut-down (lost 8 seats and Clinton sailed to re-election in 96).  You honestly don't think there would be blowback in 2014?

     




    The Republicans folded and gave in on the sequester at the begining of this month.  That was based on a premise that spending cuts would be revisited in conjunction with the Debt Ceiling issue.  Obama (though his proxy Biden) agreed to that and now that the "Fiscal Cliff" sequester got kicked down the road, he's decided he isn't going to negotiate on anything.

     

    I serioulsy doubt the public is going to place blame on the party that's sitting at the table waiting to discuss the issue while the President refuses to even show up. 

     

    And if you'll recall, in 1996 the Republicans had numerous Senators and Representives from blue states in office at the time and those were the one's ousted. The situation is reversed right now - the Democrats are holding 8 Senate seats in red states - more than enough to tip the balance in the Senate.   The Republican's have little, if anything, to loose by standing firm.  Obama and his fellow Democrats have everything on the line.

     
  4. You have chosen to ignore posts from skeeter20. Show skeeter20's posts

    Re: Krugman, Stewart in trillion-dollar coin tiff

    In response to slomag's comment:

    In response to skeeter20's comment:

     

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    In response to WhatDoYouWantNow's comment:

     

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    Cantor is not talking about collapse

     

    What a stupid thing to say. Oh, look who said it.

    Collapse is what happens if the debt limit isn't raised.

    Claiming the only thing that matters is debt service is a typical skeetard lie. How moral and Christian of you.

     



    Parsing your comment is a lie.  Here is the rest of what you said:

     

    ...by having America simply not pay money it is already obligated itself to pay"

    Obligated to pay is only debt service.  All these other things, social security, various entitlements, government is not, by supreme court decision (Flemming v. Nestor), obligated to pay. 

     And, while we are at it:  What does my religion have to do with anything here?

     



    Flemming vs Nestor says an individual does not have a contractual right to social security payments.  It doesn't address the government's ability to ignore spending mandated by Congress.  That's illegal.  Even if we didn't send a single check, we'd be obligated to continue funding social security.

     I'll stipulate that, but, despite that, there is enough money coming into  the federal treasury to MEET ALL ITS DEBT OBLIGATIONS, including social security.

    What Obama is doing is saying that he won't, not that he can't, becasu he can, pay social security related trust security debt.

    Simply put, he is putting a gun to the head of the elderly and saying "make my day"

    Not only dispicable, INO, illegal, as he can, but refuses to pay the dept.  Raising the debt ceiling has nothign to do with it.

     



    You mean he can shift money around - shut down the FBI or CIA, or unemployment or food stamps or other federal programs that would leave funds available to cut SS and Medicare checks.  

     

    I just don't think it's that simple - the second he diverts funds from one congressionally mandated area of spending to another, he's breaking the law.



    No, I mean he has plenty of revenue coming in to meet debt obligation, that's the priority.

    To peel off a piece of that debt obligation, Social Security, and say you won't pay it, EVEN THOUGH THERE IS ENOUGH REVENUE TO DO SO, is a cheap political trick, and in my estimation, a gross dereliction of duty. 

    As much as you would like to think of food stamps, unemployment as obligations, they are not.  They are entitlements, and can be shut off today, for whatever reason politicians deem appropriate.

    That the government, and by extension the democrats, and you, think it is OK to keep borrowing massively, 40% of what we spend, to pay these entitlements is blindingly stupid.  There is no sane person on Earth that thinks borrowing money to give free stuff to others makes any sense at all.

     
  5. You have chosen to ignore posts from slomag. Show slomag's posts

    Re: Krugman, Stewart in trillion-dollar coin tiff

    In response to Jim-in-Littleton's comment:

    In response to slomag's comment:

     

     

    It's not the coin that would sink republicans - it's your proposed government shutdown. That's something that would affect voters every day up to the election.  There's a growing perception that Republicans are sore losers - a GOP-led government shut-down immediately following the presiden't re-election will only cement that perception.  

    The GOP had the wind at their backs and public approval on their side in 1995, and they were blamed for the Gov't shut-down (lost 8 seats and Clinton sailed to re-election in 96).  You honestly don't think there would be blowback in 2014?

     

     




     

    The Republicans folded and gave in on the sequester at the begining of this month.  That was based on a premise that spending cuts would be revisited in conjunction with the Debt Ceiling issue.  Obama (though his proxy Biden) agreed to that and now that the "Fiscal Cliff" sequester got kicked down the road, he's decided he isn't going to negotiate on anything.

     

    I serioulsy doubt the public is going to place blame on the party that's sitting at the table waiting to discuss the issue while the President refuses to even show up. 

     

    And if you'll recall, in 1996 the Republicans had numerous Senators and Representives from blue states in office at the time and those were the one's ousted. The situation is reversed right now - the Democrats are holding 8 Senate seats in red states - more than enough to tip the balance in the Senate.   The Republican's have little, if anything, to loose by standing firm.  Obama and his fellow Democrats have everything on the line.



    Shutting down the government is the opposite of sitting at the table.

    The 95-96 shutdown lasted three weeks.  You're talking about a year and a half.  The effects would be disastrous, and there would be one guy on the ballot who wants another 2 years of it, and one guy who wants to get back to work.  I think you're in denial.

     

     
  6. You have chosen to ignore posts from Jim-in-Littleton. Show Jim-in-Littleton's posts

    Re: Krugman, Stewart in trillion-dollar coin tiff

    In response to slomag's comment:

     

    Shutting down the government is the opposite of sitting at the table.

     

    The 95-96 shutdown lasted three weeks.  You're talking about a year and a half.  The effects would be disastrous, and there would be one guy on the ballot who wants another 2 years of it, and one guy who wants to get back to work.  I think you're in denial.

     




     

    I'm afraid it's you that's in denial here.  The Republicans have been at the table waiting for the last 2 weeks already.   It'll be Obama that has to explain why he refused to talk to them for 2 months before any shutdown happened.  Obama is the one that's been making public pronouncements of his refusal to negotiate on anything here.

     

    And once a shutdown does happen, I seriously doubt it would last longer than a few weeks.  There isn't going to be any multi-year shutdown.  That's something you've pulled 100% out of your imagination.

     
  7. You have chosen to ignore posts from slomag. Show slomag's posts

    Re: Krugman, Stewart in trillion-dollar coin tiff

    In response to Jim-in-Littleton's comment:

    In response to slomag's comment:

     

     

    Shutting down the government is the opposite of sitting at the table.

     

    The 95-96 shutdown lasted three weeks.  You're talking about a year and a half.  The effects would be disastrous, and there would be one guy on the ballot who wants another 2 years of it, and one guy who wants to get back to work.  I think you're in denial.

     

     




     

     

    I'm afraid it's you that's in denial here.  The Republicans have been at the table waiting for the last 2 weeks already.   It'll be Obama that has to explain why he refused to talk to them for 2 months before any shutdown happened.  Obama is the one that's been making public pronouncements of his refusal to negotiate on anything here.

     

    And once a shutdown does happen, I seriously doubt it would last longer than a few weeks.  There isn't going to be any multi-year shutdown.  That's something you've pulled 100% out of your imagination.



    OK, maybe I mis-understood your position.  So you think that if the President has the balls to mint a coin rather than negotiate over the debt-ceiling, he's going to come crawling back to Boehner and Cantor after 3 weeks of government shut-down?  What then?  The modern day GOP doesn't understand that they are the minority party - it will probably be the Paul Ryan budget or nothing.  

    Nobody has been waiting at any table - everybody has been on vacation since the fiscal cliff deal.  There has been exactly one session of the House in the past two weeks, and that's one more than the Senate.  

    2011-03-30-Blumenthal-20110330blamepolls.png

     
  8. You have chosen to ignore posts from slomag. Show slomag's posts

    Re: Krugman, Stewart in trillion-dollar coin tiff

    In response to skeeter20's comment:

    In response to slomag's comment:

     

    In response to skeeter20's comment:

     

    In response to slomag's comment:

     

    In response to skeeter20's comment:

     

    In response to WhatDoYouWantNow's comment:

     

    In response to skeeter20's comment:

    Cantor is not talking about collapse

     

    What a stupid thing to say. Oh, look who said it.

    Collapse is what happens if the debt limit isn't raised.

    Claiming the only thing that matters is debt service is a typical skeetard lie. How moral and Christian of you.

     



    Parsing your comment is a lie.  Here is the rest of what you said:

     

    ...by having America simply not pay money it is already obligated itself to pay"

    Obligated to pay is only debt service.  All these other things, social security, various entitlements, government is not, by supreme court decision (Flemming v. Nestor), obligated to pay. 

     And, while we are at it:  What does my religion have to do with anything here?

     



    Flemming vs Nestor says an individual does not have a contractual right to social security payments.  It doesn't address the government's ability to ignore spending mandated by Congress.  That's illegal.  Even if we didn't send a single check, we'd be obligated to continue funding social security.

     I'll stipulate that, but, despite that, there is enough money coming into  the federal treasury to MEET ALL ITS DEBT OBLIGATIONS, including social security.

    What Obama is doing is saying that he won't, not that he can't, becasu he can, pay social security related trust security debt.

    Simply put, he is putting a gun to the head of the elderly and saying "make my day"

    Not only dispicable, INO, illegal, as he can, but refuses to pay the dept.  Raising the debt ceiling has nothign to do with it.

     



    You mean he can shift money around - shut down the FBI or CIA, or unemployment or food stamps or other federal programs that would leave funds available to cut SS and Medicare checks.  

     

    I just don't think it's that simple - the second he diverts funds from one congressionally mandated area of spending to another, he's breaking the law.

     



    No, I mean he has plenty of revenue coming in to meet debt obligation, that's the priority.

     

    To peel off a piece of that debt obligation, Social Security, and say you won't pay it, EVEN THOUGH THERE IS ENOUGH REVENUE TO DO SO, is a cheap political trick, and in my estimation, a gross dereliction of duty. 

    As much as you would like to think of food stamps, unemployment as obligations, they are not.  They are entitlements, and can be shut off today, for whatever reason politicians deem appropriate.

    That the government, and by extension the democrats, and you, think it is OK to keep borrowing massively, 40% of what we spend, to pay these entitlements is blindingly stupid.  There is no sane person on Earth that thinks borrowing money to give free stuff to others makes any sense at all.



    I can't pretend I'm an expert on this, but I don't think that's how it works.  You say debt obligation is our priority, but I don't think that's legally true.  Spending has been appropriated by Congress - if the President had the power to decide which programs were funded first, we would have seen abuses of that power long ago.

    BTW, I'm all for spending cuts - I just think using the threat of shutting down the government or a no vote on the debt ceiling, you're negotiating with a bomb strapped to your chest.  There's a reason we don't negotiate with terrorists - if Republicans want to submit specific cuts, the President will negotiate.  But they have to remember that they are the minority party - they're not going to get the Paul Ryan budget passed, no matter how brilliant they think they are, and how stupid they think the Dems are.  

     

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