U.S Presidency and Congress are to blame for exploding debt burden
January 8, 2013 Leave a comment
The issuance of debt as a tool to ‘develop’ an economy has shown to be futile throughout history and its fruit is being seen now
By LUIS MIRANDA | THE REAL AGENDA | JANUARY 8, 2013
U.S. President Barack Obama today attempted to scare Americans by using a spooky tone when talking about the need to continue enslaving them for the rest of their lives. Obama warned that not lifting the debt ceiling so the United States can borrow another trillion dollars or so would have “catastrophic” for the global economy.
Obama threatened Republicans by saying that if Congress does not increase the ceiling in a timely manner he would not sit down to negotiate, which implicitly means he will use his emperor’s power to raise the debt ceiling by executive order.
In his weekly radio address, Obama referred to the great challenge facing the U.S. Congress, after they came to an agreement on the so-called fiscal cliff. The debt limit authorized by Congress, which was at 16.39 trillion was exceeded Monday.
Congress now has about two months to increase the threshold again and keep the country from a supposed default. Republicans now seek to attach any agreement on the debt ceiling to cuts in public spending, which the White House rejects as a start point to begin the negotiations.
“One thing I’m not willing to make concessions on is whether or not Congress should pay the debt in an account that they themselves have built,” said Obama. “If Congress refuses to grant the United States the ability to pay its bills on time, the consequences for the entire global economy could be catastrophic,” he said.
The president recalled that “the last time Congress threatened to take that course of action” during the negotiations in mid-2011, “our entire economy suffered for it. Our families and our businesses can not stand that dangerous game again,” he added. “Our economy can not cope with more protracted clashes or manufactured crises,” he said. However, Obama himself has been one of the main enablers of the current crisis in the United States and the rest of the world by continuing the same failed policies from previous administrations.
The White House looks for ways to avoid a repeat of the acrimonious debates in the legislature of summer 2011, which led to the loss of the triple A rating on U.S. debt for the first time in history. The dispute was finally resolved with a new rise in debt, but Congress delayed the broader solution to the problem of debt and fiscal deficit until after the presidential election of November 2012. Clearly, neither the American Congress nor the White House led by Barack Obama have the best interests of the American economy in mind as both parts resort to political games before actually sitting down to truly solve the debt burden.
Obama has sought to separate disputes over U.S. budget deficit and the national debt ceiling, but Republicans insist on linking them, noting that the debt will not be solved without adjusting the budget. The U.S. national debt is now larger than the GDP of the country, however, the United States artificially continues to hold debt ratings that are better than other countries whose debt is inferior to their GDP’s. Is the credit worthiness score provided by Moody’s and other bank-owned houses a sham? Absolutely. The U.S. should have defaulted completely a long time ago.
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