July 25th, 2011 at 07:30am
An email which I sent to 2UE’s Mike Jeffreys a little bit after 1am
Good morning Mike,
I’ve been following the US debt talks with some interest and have found Obama’s fearmongering and unwillingness to do anything useful quite frustrating.
I forget the exact figures, but as I understand it, if the debt limit is not raised and the US government has to rely on incoming funds from taxes etc, then they would not have to default as they would have enough funds to keep up their debt repayments, pay the social security and Medicare bills, plus the military payroll, and might have a couple spare cents left over.
Obama (and his colleagues, the detestable Senator Harry Reid, the Senate Majority Leader in particular) has been going on and on about how if the debt limit isn’t raised, the social security and Medicare bills won’t be paid, which is a blatant lie and pure fearmongering.
He has also been trotting out the familiar line about millionaires not paying enough tax which is even sillier because even if the US government was to seize the entire income of millionaires, they would still have a massive budgetary imbalance.
The problem is overzealous spending by the government. The Republicans passed a “cut, cap and balance” plan in the House of Representatives which would have cut wasteful spending programs, capped the government’s spending at a percentage of GDP and would also have required a vote on a constitutional amendment requiring the federal government to have a balanced budget like the majority of state and local governments, and would have raised the debt limit to give the government time to implement the plan. Not surprisingly, the Democrats blocked it in the Senate because they’re addicted to big government and spending.
I’m hopeful that something similar to cut, cap and balance does get passed as merely raising the debt limit will just push the problem further down the road when it’s harder to fix, and raising taxes will just further slow any economic recovery.
Have a wonderful day Mike.
From the fortified bunker of work, Canberra