The voting public doesn't wake up to the danger of doing this until they feel the consequences of what it's like when it comes to pass. If the public never feels the consequences of a default, then they'll keep thinking the debt ceiling is something that is okay for politicians to play around with. In order for children to understand tha…
The voting public doesn't wake up to the danger of doing this until they feel the consequences of what it's like when it comes to pass. If the public never feels the consequences of a default, then they'll keep thinking the debt ceiling is something that is okay for politicians to play around with. In order for children to understand that touching hot stoves is a bad idea, they often have to get their hands burned by the stove first.
Our standing as the global reserve currency comes more from the fact that we have the most wealth and innovation in the world--and therefor the currency that will be the most stable. Yes, trust in our ability to pay our debts is a factor, but so is the fact that OPEC+ only sells oil to other countries in $USD. That forces every country that imports OPEC+ petroleum to keep $USDs in their bank in order to keep the energy imports flowing. Defaulting on our debt would discourage foreign countries from buying our govvie bonds, but it wouldn't end the $USD as a global reserve currency.
And could a default cause OPEC+ to make a change? They know how much it benefits us, giving changing conditions and an opportunity...?
I don't think a default would be a global catastrophe right away, but it could be a pretty big domino to fall in an uncertain world. How sure are we that a default would ensure 4 more years for Biden vs. a return of Trump? Obviously every policy or action can't be looked at through that lens, but I think we may be a bit of an inflection point, historically speaking. Couple a default with another Trump presidency and the world we know could be replaced in short order with a Europe left to fend for itself (and thus not support us), an emboldened China taking Taiwan while our Pacific allies look on in fear, and America's economic position as the reserve currency seriously threatened.
Don't get me wrong, I'm all for ending these stupid games, but from my view we get past the moment (if possible, the 14th is an option), and then get that gun they keep picking up and get rid of it.
We'd need a supermajority in the senate while holding the house and WH in order to get rid of the pistol via legislation. Don't think that's happening anytime this century. The easiest way to kill the debt ceiling BS in my mind is to let the GOP take the country into default. Once the damage is done the first time the idea of picking up the gun again will be so politically toxic that the GOP won't try it ever again. That's a lot easier to pull off than getting 2/3rds of the senate to agree to get rid of the debt ceiling, and even then you'd need to hold the house and WH in order to get it passed without a veto. Letting the chips fall and then hanging the entire problem around the necks of the GOP is a much quicker and realistic way to end this BS for good. There's also the chance that the GOP does get caught in a bluff and change their minds at the last minute, at which point they look extremely weak. Either way they lose in that no-compromise scenario. They either back off at the last minute or are single-handedly responsible for crashing the economy via default.
I agree the chances of getting rid of the debt ceiling are slim and none. But that's really not relevant to our current situation.
And I think one needs to guard against wishful thinking. There are a lot of serious and knowledgeable people who believe a default would be bad. Like really bad. And there is no reason to believe voters would hold the Republicans responsible for the consequences. Good or bad economic conditions are generally credited to or blamed on the President.
My concern is that the experts are right that a default would tank the economy. And that it would result in Trump getting reelected. I'm not willing to roll those dice.
Or Biden is single-handedly responsible for crashing the economy for not being reasonable. I come back to the concept that the whole voting public doesn't view the GOP as terrorists.
The voting public doesn't wake up to the danger of doing this until they feel the consequences of what it's like when it comes to pass. If the public never feels the consequences of a default, then they'll keep thinking the debt ceiling is something that is okay for politicians to play around with. In order for children to understand that touching hot stoves is a bad idea, they often have to get their hands burned by the stove first.
Our standing as the global reserve currency comes more from the fact that we have the most wealth and innovation in the world--and therefor the currency that will be the most stable. Yes, trust in our ability to pay our debts is a factor, but so is the fact that OPEC+ only sells oil to other countries in $USD. That forces every country that imports OPEC+ petroleum to keep $USDs in their bank in order to keep the energy imports flowing. Defaulting on our debt would discourage foreign countries from buying our govvie bonds, but it wouldn't end the $USD as a global reserve currency.
And could a default cause OPEC+ to make a change? They know how much it benefits us, giving changing conditions and an opportunity...?
I don't think a default would be a global catastrophe right away, but it could be a pretty big domino to fall in an uncertain world. How sure are we that a default would ensure 4 more years for Biden vs. a return of Trump? Obviously every policy or action can't be looked at through that lens, but I think we may be a bit of an inflection point, historically speaking. Couple a default with another Trump presidency and the world we know could be replaced in short order with a Europe left to fend for itself (and thus not support us), an emboldened China taking Taiwan while our Pacific allies look on in fear, and America's economic position as the reserve currency seriously threatened.
Don't get me wrong, I'm all for ending these stupid games, but from my view we get past the moment (if possible, the 14th is an option), and then get that gun they keep picking up and get rid of it.
We'd need a supermajority in the senate while holding the house and WH in order to get rid of the pistol via legislation. Don't think that's happening anytime this century. The easiest way to kill the debt ceiling BS in my mind is to let the GOP take the country into default. Once the damage is done the first time the idea of picking up the gun again will be so politically toxic that the GOP won't try it ever again. That's a lot easier to pull off than getting 2/3rds of the senate to agree to get rid of the debt ceiling, and even then you'd need to hold the house and WH in order to get it passed without a veto. Letting the chips fall and then hanging the entire problem around the necks of the GOP is a much quicker and realistic way to end this BS for good. There's also the chance that the GOP does get caught in a bluff and change their minds at the last minute, at which point they look extremely weak. Either way they lose in that no-compromise scenario. They either back off at the last minute or are single-handedly responsible for crashing the economy via default.
I agree the chances of getting rid of the debt ceiling are slim and none. But that's really not relevant to our current situation.
And I think one needs to guard against wishful thinking. There are a lot of serious and knowledgeable people who believe a default would be bad. Like really bad. And there is no reason to believe voters would hold the Republicans responsible for the consequences. Good or bad economic conditions are generally credited to or blamed on the President.
My concern is that the experts are right that a default would tank the economy. And that it would result in Trump getting reelected. I'm not willing to roll those dice.
Or Biden is single-handedly responsible for crashing the economy for not being reasonable. I come back to the concept that the whole voting public doesn't view the GOP as terrorists.