Increasingly, Americans and the markets have every reason to feel scared shitless. The controlling faction in the Republican House is a faction that is not so much anti-debt as anti-government. If they have to choose between tackling the debt and raising even some revenues (while cutting spending dramtically), they will choose to push the US into default. Such a default would risk destroying the savings of Americans, make the debt far far worse, spark a double-dip recession, and throw countless people out of work and make those in work radically less financially secure. Even those of us who have saved for retirement by buying unglamorous bonds could see our financial future wiped out by these maniacs on a mission. That is the kind of small-c conservatism these Savonarolans want to penalize.
They see this ideologically, i.e. not politically. But the political facts are these. Federal tax revenues are at a 50-year low; marginal rates are lower for many than they were when Reagan was president. In a divided government, any achievement requires some sacrifice from both sides. And yet the GOP is insisting that its side offers no sacrifice, even as the other party controls the Senate and the White House. Their own party, moreover, contributed dramatically to the debt we now face. And there is no clear evidence that raising revenues will lead to economic decline. Ronald Reagan's tax hike to deal with a much smaller debt in 1982, as Bruce Bartlett shows, preceded a burst in growth. The tough budget calls, including tax hikes, of GHW Bush and Bill Clinton led the way to economic growth far outpassing that after George W. Bush's bankrupting tax cut.
The notion that no revenues can be raised in the current crisis is, quite simply, nuts. You can even do it without raising rates, by eliminating tax expenditures/breaks. But even that golden Bowles-Simpson compromise is too much for these fanatics – even if the president coaxes his side into swallowing big spending cuts.
This is brinksmanship with all of our lives, our money, our core financial stability and future growth. It is an outrageously reckless way to run a government. And Cantor's refusal to take any personal responsibility for the result of these talks is of a piece with the record of this shallow, callow fanatic who has the gall to call himself a conservative, even as he launches a wrecking ball at the very fabric of the American and global economy.
These current Republicans would rather destroy the US economy than sacrifice one scintilla of ideological purity. They are an imminent threat to the stability of this country's economy and the world's. And they must be stopped before the damage is irreversible.
(Photo: Alex Wong/Getty.)
The Dish 