Timothy Geithner, Obama’s treasury secretary, announced that the federal government is broke and the debt ceiling needs to be raised. In a letter to Congress, he further states that not doing so would be irresponsible:
Never in our history has Congress failed to increase the debt limit when necessary. Failure to raise the limit would precipitate a default by the United States. Default would effectively impose a significant and long-lasting tax on all Americans and all American businesses and could lead to the loss of millions of American jobs. Even a very short-term or limited default would have catastrophic economic consequences that would last for decades. Failure to increase the limit would be deeply irresponsible. For these reasons, I am requesting that Congress act to increase the limit early this year, well before the threat of default becomes imminent.
I will say never before in our history have we had a bunch of irresponsible brats run up a 14 trillion dollar debt. Notice that Mr. Geithner doesn’t mention anything about cutting spending. According to this genius, which by the way was the only man qualified for this job, if we don’t raise the debt ceiling, it would be an economic catastrophe that would last generations; unlike of course expanding the federal bureaucracy and taking over whole areas of the private sector.
The Genius of D.C continues:
As you know, in February of 2010 Congress passed legislation to increase the debt limit to $14.29 trillion. As of this writing, the outstanding debt that is subject to the limit stands at $13.95 trillion, leaving approximately $335 billion of “headroom” beneath the current limit. Because of the inherent uncertainty associated with tax receipts and refunds during the spring tax filing season, as well as other variable factors, it is not possible at this point to predict with precision the date by which the debt limit will be reached. However, the Treasury Department now estimates that the debt limit will be reached as early as March 31, 2011, and most likely sometime between that date and May 16, 2011. This estimate is subject to change depending on the performance of the economy, government receipts, and other factors. This means it is necessary for Congress to act by the end of the first quarter of 2011.
And we all know how well the economy has performed over the past couple of years. The Lord of the Potomac warns that failure to raise the debt limit would result in a government shutdown:
Reaching the debt limit would mean the Treasury would be prevented by law from borrowing in order to pay obligations the Nation is legally required to pay, an event that has no precedent in American history. Such a default should be understood as distinct from a temporary government shutdown resulting from failure to enact appropriations bills, which occurred in late 1995 and early 1996. Those government shutdowns, which were unwise and highly disruptive, did not have the same long-term negative impact on U.S. creditworthiness as a default would, because there was headroom available under the debt limit at that time.
And that is what probably needs to happen. We need cut out all of these bureaucracies. Whole departments need to go. The shutdown of 1995 and 1996 in D.C. may have been disruptive to that town, but life went on for the rest of us. As a matter of fact, it was a welcomed respite from the disrupting influence of a government bureaucrat.
The nation’s chief beggar pleads on:
For these reasons, any default on the legal debt obligations of the United States is unthinkable and must be avoided. It is critically important that Congress act before the debt limit is reached so that the full faith and credit of the United States is not called into question. The confidence of citizens and investors here and around the world that the United States stands fully behind its legal obligations is a unique national asset. Throughout our history, that confidence has made U.S. government bonds among the best and safest investments available and has allowed us to borrow at very low rates.
I’ve got news for you Mr. Geithner, the confidence of American citizens and investors around the world has called into question the full faith and credit of the United States. There is not enough money in the world to pay for the past promises of politicians, and that bloated leviathan called the U.S. federal government. Rep. Paul Ryan (R-Wisconsin) has already informed you of the consequences of our debt and the U.S. bond market:
Source: http://www.treasury.gov/connect/blog/Pages/letter.aspx
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