Boehner: 'This Debt Limit Increase is Obama's Problem'

Boehner: ‘This Debt Limit Increase is Obama’s Problem’

Getting stranger all the time

PoliticsJuly 2011 • Views: 23,218

In today’s News of the Boehner, the Speaker of the House has hit on yet another strange way to shift the blame for holding America’s economy hostage, away from Republicans and onto the eternal object of right wing rage: Boehner Says The Debt Limit Increase Is Obama’s Problem.

Speaker of the House John Boehner introduced a new argument to the debt ceiling and deficit reduction talks Tuesday, saying raising the borrowing limit is Republicans’ concession in the negotiations.

“This debt limit increase is [Obama’s] problem,” he said.

Reaching a new nadir of political reversal rhetoric, Boehner seems to have missed the fact that most of the country’s voters (even most Republicans) are not in favor of burning the country’s economy just to preserve low taxes for the wealthy. If the GOP really goes through with the tough talk and defaults on America’s credit, the majority of the public will put the responsibility squarely where it belongs — in Boehner’s lap.

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114 comments

Political Atheist Tue, Jul 12, 2011 10:42:29am

May I point out the legislature has the budget responsibility, as per the constitution? Anyone else recall Pres Clinton losing the line item veto to a constitutional challenge?

SanFranciscoZionist Tue, Jul 12, 2011 10:42:37am

Well. There it is.

(I believe it was the Emperor in Amadeus who kept saying that--most hilariously when Mozart's mother in law passed out at his feet from the overload of meeting him.)

Lidane Tue, Jul 12, 2011 10:44:19am

It's amazing how these Republican nutjobs don't learn.

They tried pinning the government shutdown on Clinton back in 1995. It backfired and got Bill a second term in '96. What makes them think that trying to pin any default on Obama will work now, especially when they've spent months beating the DEFAULT IS NO BIG DEAL drum?

makeitstop Tue, Jul 12, 2011 10:44:34am

Obama has answered - No Social Security Guarantee In August If GOP Doesn’t Back Down

"This is not just a matter of Social Security checks," Obama told CBS News in an interview that will air Tuesday night. "These are veteran's checks, these are folks on disability and their checks. There are about 70 million checks that go out each month. I can not guarantee that those checks go out on August 3rd if we haven't resolved this issue. Because there may simply not be the money in the coffers to do it."

I think he's got the TPGOP pretty much boxed in at this point.

laZardo Tue, Jul 12, 2011 10:44:36am

If the GOP really goes through with the tough talk and defaults on America’s credit, the majority of the public will put the responsibility squarely where it belongs — in Boehner’s lap.

Not unless the GOP can convince the public that it's Obama's fault, not theirs (legislative responsibility be damned).

Which, I suspect, they have been doing too well.

wrenchwench Tue, Jul 12, 2011 10:44:36am

He's not kicking the can down the road. He's kicking the can into the trash. (Recycling? What kind of commie enviroweenie are you?)

Political Atheist Tue, Jul 12, 2011 10:47:39am

re: #4 makeitstop

Isn't that a prevarication? S/S has its own funding and not gonna go into the red for quite some time.

Holidays are Family Fun Time Tue, Jul 12, 2011 10:48:32am

It's like they are playing "hot potato"

Obama says it's Congress's problem.
Boehner says it's Obama's problem.

WTF? These are adults, right?

Zathras Tue, Jul 12, 2011 10:48:38am

Businesses know better than to risk a default. The only ones against a debt ceiling? Know-Nothings like the arithmetically-challenged Eric Cantor

shutdown Tue, Jul 12, 2011 10:48:43am

This is going to bite the GOP in the ass big time. Boehner et al are under the mistaken impression that the loudest members of the base are going to be the ones whose numbers are sufficient to re-elect them to Congress and get their candidate into the WH. I don't think the majority of general election voters are going to buy this argument, and I think the GOP is missing a golden opportunity to show a willingness to compromise while making the economy a real Democratic issue.

darthstar Tue, Jul 12, 2011 10:49:05am

Boehner's in over his head. He should go back to sweeping barroom floors.

Holidays are Family Fun Time Tue, Jul 12, 2011 10:49:38am

re: #1 Rightwingconspirator

May I point out the legislature has the budget responsibility, as per the constitution? Anyone else recall Pres Clinton losing the line item veto to a constitutional challenge?

He must be using Newt's interpretation of the Constitution . . .

albusteve Tue, Jul 12, 2011 10:49:38am

govt seized up...sitting at idol burning fuel...lost, no map, can't even speak the local language

Brother Holy Cruise Missile of Mild Acceptance Tue, Jul 12, 2011 10:50:05am

re: #10 imp_62

they think the loudest represent the majority, they are very mistaken on thaty and reality is starting to bite them in the ass already. More people are beginning to side with Obama on the whole matter and it wouldn't suprise me to see that continue.

Lidane Tue, Jul 12, 2011 10:50:07am

re: #12 ggt

He must be using Newt's interpretation of the Constitution . . .

You mean the one that doesn't have a SCOTUS in it?

Heh.

albusteve Tue, Jul 12, 2011 10:51:31am

re: #8 ggt

It's like they are playing "hot potato"

Obama says it's Congress's problem.
Boehner says it's Obama's problem.

WTF? These are adults, right?

that's arguable....a bunch of self centered narcissists is undeniable tho

makeitstop Tue, Jul 12, 2011 10:52:10am

re: #7 Rightwingconspirator

Isn't that a prevarication? S/S has its own funding and not gonna go into the red for quite some time.

Let Boehner explain that - if he says Obama isn't being truthful, that takes away one of his big chips, that Social Security must be cut.

His bluff is being called, and from the look of it Obama is a much better poker player than Boehner..

wrenchwench Tue, Jul 12, 2011 10:52:12am

McConnell is also deferring responsibility.

Meanwhile Senate Minority Leader Mitch McConnell (R-KY) offered his strongest criticism yet of President Barack Obama's leadership in the ongoing talks.
"I have little question that as long as this President is in the Oval Office, a real solution is unattainable," he said on the Senate floor Tuesday. Adding, “This was not an easy decision for me."

Obama, he said, "has presented us with three choices: smoke and mirrors, tax hikes or default. Republicans choose none of the above."

I heard a quote from him over the weekend. "Nobody is talking about not raising the debt ceiling." My response would be called "unmannerly."

Political Atheist Tue, Jul 12, 2011 10:53:32am

I do not understand Obama threatening S/S checks. That just may be either a threat to illegally withhold the money or a huge lie. Am I wrong?

makeitstop-You might want to page this, its from your link.
"This is not just a matter of Social Security checks," Obama told CBS News in an interview that will air Tuesday night. "These are veteran's checks, these are folks on disability and their checks. There are about 70 million checks that go out each month. I can not guarantee that those checks go out on August 3rd if we haven't resolved this issue. Because there may simply not be the money in the coffers to do it."

Holidays are Family Fun Time Tue, Jul 12, 2011 10:53:41am

re: #16 albusteve

that's arguable...a bunch of self centered narcissists is undeniable tho

It's more about votes in November than anything else.

"Vote for me, I was MORE right that he was"

Holidays are Family Fun Time Tue, Jul 12, 2011 10:54:33am

re: #18 wrenchwench

McConnell is also deferring responsibility.

I heard a quote from him over the weekend. "Nobody is talking about not raising the debt ceiling." My response would be called "unmannerly."

zero-sum game --that's going to get us no where.

shutdown Tue, Jul 12, 2011 10:54:51am

re: #20 ggt

It's more about votes in November than anything else.

"Vote for me, I was MORE right that he was"

No, more like: "Vote for me. You have no idea what either of us are saying, but I am white and definitely American and Christian."

Lidane Tue, Jul 12, 2011 10:55:25am

re: #18 wrenchwench

McConnell is also deferring responsibility.

I heard a quote from him over the weekend. "Nobody is talking about not raising the debt ceiling." My response would be called "unmannerly."

And here I thought the GOP was all about personal responsibility.

Oh, wait. That's just for other people. Never mind. =P

S'latch Tue, Jul 12, 2011 10:55:45am

I heard someone today suggest that we should just get rid of the debt limit. If we are supposed to increase it so frequently and readily, why should we even have one? I don't know what the answer to this question is. I really don't have time to figure it out. But it sounded like an interesting suggestion and good question. Maybe someone knows where the answer is.

albusteve Tue, Jul 12, 2011 10:56:49am

re: #20 ggt

It's more about votes in November than anything else.

"Vote for me, I was MORE right that he was"

as the decades go by, the govt should become smarter, leaner and more efficient...instead is gets slower, more bloated more stupid and cumbersome until it looks like Jabba the Hut

Holidays are Family Fun Time Tue, Jul 12, 2011 10:58:19am

re: #25 albusteve

as the decades go by, the govt should become smarter, leaner and more efficient...instead is gets slower, more bloated more stupid and cumbersome until it looks like Jabba the Hut

too much money and power involved for efficiency, IMHO.

What government has ever gotten smarter, leaner and more efficient without MAJOR upheavel?

Bulworth Tue, Jul 12, 2011 10:58:29am

I do not understand Obama threatening S/S checks. That just may be either a threat to illegally withhold the money or a huge lie. Am I wrong?

I'm not an expert on the debt ceiling, but the S/S situation is complicated by the fact that (1) the recession has resulted in a negative payroll tax to benefit payout cash flow* and (2) the payroll tax cut instituted this year which is being replaced by an infusion of general revenues to replace the taxes that would have come from the current law higher payroll taxes.

*The S/S system is still in surplus because the Trust Funds earn interest on the money they've been loaning the general budget for decades.

Political Atheist Tue, Jul 12, 2011 10:58:37am

re: #17 makeitstop

The GOP has been playing the same bluff.

laZardo Tue, Jul 12, 2011 10:59:31am

re: #26 ggt

too much money and power involved for efficiency, IMHO.

What government has ever gotten smarter, leaner and more efficient without MAJOR upheavel?

End the Fed!

Political Atheist Tue, Jul 12, 2011 10:59:35am

re: #27 Bulworth

I'm not an expert on the debt ceiling, but the S/S situation is complicated by the fact that (1) the recession has resulted in a negative payroll tax to benefit payout cash flow* and (2) the payroll tax cut instituted this year which is being replaced by an infusion of general revenues to replace the taxes that would have come from the current law higher payroll taxes.

*The S/S system is still in surplus because the Trust Funds earn interest on the money they've been loaning the general budget for decades.

Ergo the money is there to back the checks. Period.

makeitstop Tue, Jul 12, 2011 11:01:08am

re: #19 Rightwingconspirator

I do not understand Obama threatening S/S checks. That just may be either a threat to illegally withhold the money or a huge lie. Am I wrong?

makeitstop-You might want to page this, its from your link.
"This is not just a matter of Social Security checks," Obama told CBS News in an interview that will air Tuesday night. "These are veteran's checks, these are folks on disability and their checks. There are about 70 million checks that go out each month. I can not guarantee that those checks go out on August 3rd if we haven't resolved this issue. Because there may simply not be the money in the coffers to do it."

Honestly, I'm not sure. I'm guessing Obama's got his reasons for saying what he said, though.

Holidays are Family Fun Time Tue, Jul 12, 2011 11:01:14am

re: #30 Rightwingconspirator

Ergo the money is there to back the checks. Period.

What rate of interest does the money earn?

shutdown Tue, Jul 12, 2011 11:01:40am

re: #24 Lawrence Schmerel

I heard someone today suggest that we should just get rid of the debt limit. If we are supposed to increase it so frequently and readily, why should we even have one? I don't know what the answer to this question is. I really don't have time to figure it out. But it sounded like an interesting suggestion and good question. Maybe someone knows where the answer is.

The sovereign debt limit is a concept unique to the US. I am not aware of the legislative origins, but I assume it has something to do with purported checks and balances.

laZardo Tue, Jul 12, 2011 11:01:48am

re: #31 makeitstop

Honestly, I'm not sure. I'm guessing Obama's got his reasons for saying what he said, though.

Government shutdown, possibly?

thatthatisis Tue, Jul 12, 2011 11:01:57am

I do think Boehner is in over his head. Not because he doesn't get it, but because he doesn't have the leadership skills to corral the votes. He's dealing with ambitious Cantor, who's probably plotting his presidential run for 2016 over $350-bottle wine; along with freshmen members of Congress who've been listening to Michele Bachmann too much to even understand what the debt ceiling really is.

They're failing our country. And frankly, all the people who voted them in - or who didn't vote at all - back in 2010 failed our country.

blueraven Tue, Jul 12, 2011 11:02:19am

re: #19 Rightwingconspirator

I do not understand Obama threatening S/S checks. That just may be either a threat to illegally withhold the money or a huge lie. Am I wrong?

makeitstop-You might want to page this, its from your link.
"This is not just a matter of Social Security checks," Obama told CBS News in an interview that will air Tuesday night. "These are veteran's checks, these are folks on disability and their checks. There are about 70 million checks that go out each month. I can not guarantee that those checks go out on August 3rd if we haven't resolved this issue. Because there may simply not be the money in the coffers to do it."

There has to be priorities if we do not raise the debt ceiling. Yes SS is self funded, but c'mon, we have been borrowing from the fund for decades.

We only have so much federal revenue coming in from all sources. We have to pay interest on the debt, military expenses, salaries etc...So I dont think it is a lie to say there may not be enough to pay out all SS or veterans benefits.

Political Atheist Tue, Jul 12, 2011 11:02:22am

re: #27 Bulworth

One guy around here has pounded on this in page after page. I argue with him on his conspiracy / Kabuki theater presentation, but his facts about S/S monies are in order. S/S is utterly separate in funding. The money is there. So... WTF?

Bulworth Tue, Jul 12, 2011 11:03:03am

re: #30 Rightwingconspirator
Except that the Trust Fund interest comes from general revenue. In other words, in contrast to past years, Social Security is receiving general revenue transfers (from this year's payroll tax replacement as well as from the Trust Fund interest).

Obdicut Tue, Jul 12, 2011 11:03:33am

re: #37 Rightwingconspirator

Hasn't the general fund already borrowed all the money from social security?

(I Stand By What I Said Whatever It Was) Tue, Jul 12, 2011 11:03:34am

Youtube Video

makeitstop Tue, Jul 12, 2011 11:03:51am

re: #28 Rightwingconspirator

The GOP has been playing the same bluff.

Maybe he's decided to fight fire with fire?

I'm guessing that vets and people on disability are going to hear this and get on the horn with their reps. Maybe that's what he's aiming for.

S'latch Tue, Jul 12, 2011 11:04:15am

re: #24 Lawrence Schmerel

I heard someone today suggest that we should just get rid of the debt limit. If we are supposed to increase it so frequently and readily, why should we even have one? I don't know what the answer to this question is. I really don't have time to figure it out. But it sounded like an interesting suggestion and good question. Maybe someone knows where the answer is.

I am answering my own question here. I forgot that I can just Google these questions and get answers.

[Link: blogs.wsj.com...]

Now all I have to do is read it.

Varek Raith Tue, Jul 12, 2011 11:05:16am

I'm actually getting more and more concerned that the GOP is really going just let the deadline pass come hell or high water.

Killgore Trout Tue, Jul 12, 2011 11:05:22am

Great work in the pages this morning! Kudos to all, great stuff.

Political Atheist Tue, Jul 12, 2011 11:06:36am

re: #39 Obdicut

I never heard that.

makeitstop Tue, Jul 12, 2011 11:07:25am

Here's some background from a USA Today article:

It shows that in August, the government could not afford to meet 44% of its obligations. Since the $134 billion deficit for that month couldn’t be covered with more borrowing, programs would have to be cut.

If Social Security, Medicare, Medicaid, unemployment benefits, payments to defense contractors and interest payments on Treasury bonds were exempt, that would be all the government could afford for the month. No money for troops or veterans. No tax refunds. No food stamps or welfare. No federal salaries or benefits.

Want to protect the social safety net? That would be possible — but only if Treasury stopped paying defense contractors, jeopardizing national security. Plus virtually every federal agency and employee.

Obdicut Tue, Jul 12, 2011 11:08:07am

re: #37 Rightwingconspirator

One guy around here has pounded on this in page after page. I argue with him on his conspiracy / Kabuki theater presentation, but his facts about S/S monies are in order. S/S is utterly separate in funding. The money is there. So... WTF?

Yeah, here's your answer:

The monies paid into social security don't go directly to the people getting social security, but to pay into the trust fund, which then invests in special US securities. The interest is paid out on those securities by the US government, and it's that revenue that funds the social security checks.

So Obama wasn't lying, or incorrect. If we default on debts, social security payouts are one of the biggest debts.

thatthatisis Tue, Jul 12, 2011 11:08:33am

re: #24 Lawrence Schmerel

Not sure how we could get rid of the requirement to approve the debt ceiling. I'm not an expert either, but as I understand it, it works like this:

The legislative branch votes on all the various bills. That, plus the bills that previously were voted on that still apply, creates a payment obligation which the US government must cover. The government usually covers it by issuing debt, in the form of US Treasury bonds. Bonds are nothing more than debt instruments. Then people who buy the bonds are the people who own the debt. Americans buy the bonds, but so do foreign corporations and foreign countries, such as China.

The legal right to issue bonds is essentially what the debt ceiling describes.

This may be wrong, but that' what I have heard. Maybe others can chime in?

Obdicut Tue, Jul 12, 2011 11:09:07am

re: #45 Rightwingconspirator

I never heard that.

[Link: www.ssa.gov...]

Social Security has all its money invested in federal securities, and all its income comes from the payouts of those securities.

Lidane Tue, Jul 12, 2011 11:09:22am

re: #43 Varek Raith

I'm actually getting more and more concerned that the GOP is really going just let the deadline pass come hell or high water.

And then they'll wonder why everyone is pissed at them when a default happens.

makeitstop Tue, Jul 12, 2011 11:09:58am

Obama's point is simply that someone is not going to get paid come August - seems to be an either/or proposition.

OhCrapIHaveACrushOnSarahPalin Tue, Jul 12, 2011 11:11:05am

Boehner is desperate. Got this from a link sent by that raving bigot Judson Philips of Tea Party Nation.

Boehner must go!
Posted by Judson Phillips on July 11, 2011 at 3:14pm in Tea Party Nation Forum

John Boehner is either a gutless coward, an absolute idiot or both. What floors me is under the circumstances the GOP rank and file has not done something about him. The GOP has the greatest mandate in a century and not only is Boehner blowing the mandate, he may single handedly return Nancy Pelosi to the Speaker's chair. We could ask what is he thinking but it is obvious he is not thinking.

Boehner has got to go immediately and the GOP needs to replace him now. We need someone who has courage and convictions. We need someone who will not sell us out. In short, we need anyone but John Boehner.

Ridiculous hayseeds.

uncah91 Tue, Jul 12, 2011 11:11:14am

The debt ceiling is a by product of a time long ago (100+ years) when the legislative branch approved EACH individual bond issue. Then they decided to make the process more "efficient by saying to the executive "Pay for the spending we authorize by issuing debt up to this limit."

They could easily get rid of the limit by simply passing a law that says "Pay for the spending we authorize by ussiung debt."

Political Atheist Tue, Jul 12, 2011 11:11:42am

re: #47 Obdicut

mikiesmoky2 has logged in he has spent the time looking into this. At this point it's over my head, and I'm kinda lurkin while workin. I'll hope to hear from him. Mikie, take it easy ok?

Political Atheist Tue, Jul 12, 2011 11:12:23am

re: #54 Rightwingconspirator

mikiesmoky2 has logged in he has spent the time looking into this. At this point it's over my head, and I'm kinda lurkin while workin. I'll hope to hear from him. Mikie, take it easy ok?

Hope you don't mind a little shorthand...

Obdicut Tue, Jul 12, 2011 11:13:52am

re: #54 Rightwingconspirator

There's nothing to look into. It's really simple:

1. Social security taxes are collected.

2. Those taxes are immediately invested into US securities-- non-market ones, ones specially made for SS.

3. Those securities come due over time and generate money through interest and repayment-- by the Feds.

4. Those revenues pay out social security checks.

It's very straightforward.

S'latch Tue, Jul 12, 2011 11:14:11am

re: #53 uncah91

In other words, the fact that we need to raise the debt ceiling clearly illustrates that Congress has authorized spending without regard to how we are supposed to pay for it.

Spocomptonite Tue, Jul 12, 2011 11:14:23am

re: #27 Bulworth

I'm not an expert on the debt ceiling, but the S/S situation is complicated by the fact that (1) the recession has resulted in a negative payroll tax to benefit payout cash flow* and (2) the payroll tax cut instituted this year which is being replaced by an infusion of general revenues to replace the taxes that would have come from the current law higher payroll taxes.

*The S/S system is still in surplus because the Trust Funds earn interest on the money they've been loaning the general budget for decades.

A lot of people forget that S/S makes money off the national debt. In fact, the trust fund alone holds $2.5 trillion in bonds and other debt securities, which is half as much as all other foreign holdings put together. All intragovernmental ownership of debt still exceeds foreign ownership.

This also means another problem if the debt ceiling isn't raised: if interest isn't paid, then many governmental agencies will be losing two forms of funding.

Holidays are Family Fun Time Tue, Jul 12, 2011 11:14:24am

re: #51 makeitstop

Obama's point is simply that someone is not going to get paid come August - seems to be an either/or proposition.

Congress? They are the ones that shouldn't be paid, but it will never happen.

uncah91 Tue, Jul 12, 2011 11:14:27am

re: #49 Obdicut

[Link: www.ssa.gov...]

Social Security has all its money invested in federal securities, and all its income comes from the payouts of those securities.

And if the government defaults on paying for those securities, no checks.

Much of this is also a cash flow problem. We have been running "over" the debt ceiling since May. We are essentially already paying for govt with existing revenues. 8/2 isn't when we hit the limit, it's when we stop finding clever ways of needing more bonds issued.

uncah91 Tue, Jul 12, 2011 11:16:55am

re: #57 Lawrence Schmerel

Correct. They have already authorized spending over the limit.

makeitstop Tue, Jul 12, 2011 11:16:59am

re: #59 ggt

Congress? They are the ones that shouldn't be paid, but it will never happen.

That's what I'd do! Let them do without. No pay, no bennies, no jets back to the home district. Zero, until this is resolved.

I don't even know if it's possible, and the lawmakers have probably already stacked the deck so that their payments can't be interrupted.

Zathras Tue, Jul 12, 2011 11:17:24am

The problem with guaranteeing Social Security is that, while on the average day Treasury will have enough to meet obligations, there are significant fluctuations from day-to-day. Hitting the debt ceiling means the feds have to have the cash on hand immediately. Today the money may be there. Tomorrow or the next day a payment may be late. Operating on a cash basis like that is absolutely insane--not a single large company does so, but that's where the GOP has the country boxed into.

Bulworth Tue, Jul 12, 2011 11:19:25am

1. Social security taxes are collected.

To add to this, when the government collects tax revenue, it is all aggregated (i.e. FICA* taxes, estimated income taxes, etc). So the Treasury just has this big pile of money in taxes. The Treasury than more or less assigns the appropriate share of this pile to S/S. So there is some lag time in distinguishing between income tax revenue and Social Security tax revenue.

*FICA refers to combined Social Security and Medicare taxes

uncah91 Tue, Jul 12, 2011 11:23:16am

re: #63 Zathras

Plus, we are ALREADY at the limit. We don't hit it on 8/2, we run out of ways to avoid it hurting us.

Political Atheist Tue, Jul 12, 2011 11:23:40am

Mikiesmoky2 I see you are logged in. Anything to refute what we are seeing from a couple posters above?

mikiesmoky2 Tue, Jul 12, 2011 11:23:58am

re: #4 makeitstop

Obama has answered - No Social Security Guarantee In August If GOP Doesn’t Back Down

I think he's got the TPGOP pretty much boxed in at this point.

I don't want to call President Obama a liar, but, at best, he has been misinformed.
The SS Trust fund is separate from the federal budget and has about $2.5 trillion dollars of assets with which to pay SS obligations regardless of the federal budget problems. There are two caveats: the fund, itself, may have to pay the administrative costs (about $1 billion per month) if those funds will not be forthcoming from the general fund (federal budget) and they should prepare for cash expenditures by selling additional treasuries, before the possibility of the prices of those treasuries falling due to the potential logistical problems created by a ceiling debt limitation.

Further and sadly, he doesn't have the GOP "boxed in", because we know that if his adversaries hold "hostages", he will succumb as he did last December, when he allowed the Bush tax errors to continue for those with T.I.'s in excess of $250,000 per year.

S'latch Tue, Jul 12, 2011 11:24:35am

I wish I could increase my debt limit, but my bank told me I couldn't do that on my own.

Obdicut Tue, Jul 12, 2011 11:24:52am

re: #67 mikiesmoky2

The SS Trust fund is separate from the federal budget and has about $2.5 trillion dollars of assets with which to pay SS obligations regardless of the federal budget problems.

Do you understand those assets are US securities-- i.e., federal debt?

Zathras Tue, Jul 12, 2011 11:25:27am

re: #68 Lawrence Schmerel

I wish I could increase my debt limit, but my bank told me I couldn't do that on my own.

Your creditworthiness is not as good as for the US. Of course, that will likely change next month....

Spocomptonite Tue, Jul 12, 2011 11:26:03am

I'd also like to point out that issuing more bonds would be no trouble at all; in fact it would probably be the easiest time in history as interest rates are at historic lows.

If the market eagerly wants to take on debt securities that only pay 1-3% interest rates, why hold them back?

uncah91 Tue, Jul 12, 2011 11:32:39am

re: #69 Obdicut

Do you understand those assets are US securities-- i.e., federal debt?

This.

uncah91 Tue, Jul 12, 2011 11:34:13am

re: #68 Lawrence Schmerel

I wish I could increase my debt limit, but my bank told me I couldn't do that on my own.

Actually, you can. Go out on the market and sell a bond. There are micro-lending sites that will make it much easier for you.

Political Atheist Tue, Jul 12, 2011 11:35:21am

re: #69 Obdicut

That's a good point.

S'latch Tue, Jul 12, 2011 11:35:23am

re: #73 uncah91

You gotta be kidding me. Someone on the market is going to buy a bond that I created, from me? Who? Where?

Spocomptonite Tue, Jul 12, 2011 11:35:35am

re: #67 mikiesmoky2

You're the one that's misinformed. Read my #58, and look at the TreasuryDirect links in there. It lists federal ownership of national debt securities, and SS has $2.5 trillion of the federal government's $4.6 billion total.

Obdicut Tue, Jul 12, 2011 11:35:47am

re: #75 Lawrence Schmerel

You gotta be kidding me. Someone on the market is going to buy a bond that I created, from me? Who? Where?

extremelyshadytransactions.com

S'latch Tue, Jul 12, 2011 11:36:29am

re: #77 Obdicut

Thanks! BRB!

Spocomptonite Tue, Jul 12, 2011 11:38:30am

re: #75 Lawrence Schmerel

You gotta be kidding me. Someone on the market is going to buy a bond that I created, from me? Who? Where?

formerlyknownaslehmanbros.com

or is it .biz?

uncah91 Tue, Jul 12, 2011 11:39:24am

re: #75 Lawrence Schmerel

Well, you are saying that the market doesn't want to buy your bond. If no one wanted to buy the governments bonds, they couldn't "raise their own debt ceiling" either.

S'latch Tue, Jul 12, 2011 11:40:57am

re: #80 uncah91

I do agree with that. The real debt ceiling is the limit that our lenders are willing to lend "U.S."

makeitstop Tue, Jul 12, 2011 11:41:08am

re: #67 mikiesmoky2

I don't want to call President Obama a liar, but, at best, he has been misinformed.
The SS Trust fund is separate from the federal budget and has about $2.5 trillion dollars of assets with which to pay SS obligations regardless of the federal budget problems. There are two caveats: the fund, itself, may have to pay the administrative costs (about $1 billion per month) if those funds will not be forthcoming from the general fund (federal budget) and they should prepare for cash expenditures by selling additional treasuries, before the possibility of the prices of those treasuries falling due to the potential logistical problems created by a ceiling debt limitation.

See my #46. Someone isn't getting their money on 8/3 - either vets, SS and disability recipients; or defense contractors, government employees and essential services.

Further and sadly, he doesn't have the GOP "boxed in", because we know that if his adversaries hold "hostages", he will succumb as he did last December, when he allowed the Bush tax errors to continue for those with T.I.'s in excess of $250,000 per year.

mz

No, we don't 'know' that. People 'knew' that when he supposedly 'got rolled' in the budget talks, and the GOP ended up with about $35 billion less than they thought they were getting.

Who do you think is going to be catching heat from Obama's statement? People will be calling their reps, not the White House.

Obama lit the fuse with some clever rhetoric. Idiots like Boehner and Cantor will be the ones fielding the angry phone calls.

Jack Burton Tue, Jul 12, 2011 11:41:11am

re: #79 Spocomptonite

formerlyknownaslehmanbros.com

or is it .biz?

I thought that was the Bank of Evil now.

recusancy Tue, Jul 12, 2011 11:42:09am

re: #24 Lawrence Schmerel

I heard someone today suggest that we should just get rid of the debt limit. If we are supposed to increase it so frequently and readily, why should we even have one? I don't know what the answer to this question is. I really don't have time to figure it out. But it sounded like an interesting suggestion and good question. Maybe someone knows where the answer is.

No other country has one. It's completely pointless other than to cause messes like this.

uncah91 Tue, Jul 12, 2011 11:42:15am

re: #75 Lawrence Schmerel

You gotta be kidding me. Someone on the market is going to buy a bond that I created, from me? Who? Where?

As to a market for your essentially unsecured debt, backed by the faith and credit of your business (essentially a bond), check out kiva.org

S'latch Tue, Jul 12, 2011 11:43:38am

re: #85 uncah91

I won't do that. I will do as I always have, and as I would advise others to do, and live within my means.

blueraven Tue, Jul 12, 2011 11:45:47am

re: #67 mikiesmoky2

I don't want to call President Obama a liar, but, at best, he has been misinformed.
The SS Trust fund is separate from the federal budget and has about $2.5 trillion dollars of assets with which to pay SS obligations regardless of the federal budget problems. There are two caveats: the fund, itself, may have to pay the administrative costs (about $1 billion per month) if those funds will not be forthcoming from the general fund (federal budget) and they should prepare for cash expenditures by selling additional treasuries, before the possibility of the prices of those treasuries falling due to the potential logistical problems created by a ceiling debt limitation.

Further and sadly, he doesn't have the GOP "boxed in", because we know that if his adversaries hold "hostages", he will succumb as he did last December, when he allowed the Bush tax errors to continue for those with T.I.'s in excess of $250,000 per year.

mz

And you should also know that the SS trust fund has been borrowed against for YEARS!
When the GOP talks about SS going broke, this is what they mean. At a certain point the payroll deduction revenues can not cover the payout and the government will have to pay SS trust fund what is owed.

Meanwhile that money is not sitting in a LOCK BOX as Al Gore might say.

Political Atheist Tue, Jul 12, 2011 11:46:47am

re: #32 ggt

I think that's set by the fed. Damn little. But not my field so take it with a grain.

uncah91 Tue, Jul 12, 2011 11:46:51am

re: #86 Lawrence Schmerel

It was more tongue-in-cheek than anything else. Not really sarc, but close.

BTW, do you own a home? Is it mortgaged?

If so, and you can't pay the mortgage off with cash assets, you aren't really "living with your means" (for purposes of this conversation.)

S'latch Tue, Jul 12, 2011 11:47:54am

re: #85 uncah91

I did look at kiva.org, though. This does not appear to be what you are representing. This appears to be a way to lend $25.00 to help individuals who are living in foreign countries including Kenya, Nicaragua, Paraguay, etc.

mikiesmoky2 Tue, Jul 12, 2011 11:48:16am

re: #8 gt

It's like they are playing "hot potato"

Obama says it's Congress's problem.
Boehner says it's Obama's problem.

WTF? These are adults, right?

It IS Congress's problem, and, in fact, most of our problems have been caused by Congress, with its axes to grind and shortsightedness.

Obdicut Tue, Jul 12, 2011 11:49:31am

re: #91 mikiesmoky2

Hey--

Do you get that the assets of SS are all US treasuries, and so a default would mean the interest on those weren't being paid?

S'latch Tue, Jul 12, 2011 11:50:24am

re: #89 uncah91

I have a home that is worth about $150,000.00. I owe $24,000.00. I have no other debt. My mortgage is about $500.00 a month which I am able to earn and pay. I call that living within my means. If it does not fit the definition, I stand corrected.

Political Atheist Tue, Jul 12, 2011 11:50:35am

re: #91 mikiesmoky2

I had a strong feeling all along that the S/S monies were not as sacrosanct as you had said. Already borrowed out? Is that what makes Obama correct today?

mikiesmoky2 Tue, Jul 12, 2011 11:56:24am

re: #17 makeitstop

Let Boehner explain that - if he says Obama isn't being truthful, that takes away one of his big chips, that Social Security must be cut.

His bluff is being called, and from the look of it Obama is a much better poker player than Boehner..

As in REMEMBER THE ALAMO....., REMEMBER THE HOSTAGE'S CONCEPT

It was a horrendous signal President Obama sent.
But..., of course, it was a facade, i.e., it was a pretend signal that President Obama used to continue the larceny of the Bush tax "errors".

Obdicut Tue, Jul 12, 2011 11:58:41am

re: #95 mikiesmoky2

Do you plan on just replying to yourself?

uncah91 Tue, Jul 12, 2011 11:59:33am

re: #93 Lawrence Schmerel

No, it does fit the general definition of living with ones means.

But you said you (paraphrasing) "wouldn't issue bonds, but rather, live with your means."

But living within ones means doesn't mean having no debt. That was my only point. And it doesn't mean not increasing debt.

For instance, if you lost your job, you might even increase your debt (by paying your mortgage with a home equity line) rather than lose your house by failing to pay your mortgage payment.

And again, I was being sort of tongue-in-cheek when I suggested using a micro-lending site to "issue your own bond."

JEA62 Tue, Jul 12, 2011 12:01:15pm

I'm actually to the point now where I'm hoping we DO default, consequences be damned.
Just f---ing shoot me now and get it over with.

recusancy Tue, Jul 12, 2011 12:01:37pm

re: #98 JEA62

I'm actually to the point now where I'm hoping we DO default, consequences be damned.
Just f---ing shoot me now and get it over with.

That's nihilism.

100

mikiesmoky2 Tue, Jul 12, 2011 12:07:34pm

re: #47 Obdicut

Yeah, here's your answer:

The monies paid into social security don't go directly to the people getting social security, but to pay into the trust fund, which then invests in special US securities. The interest is paid out on those securities by the US government, and it's that revenue that funds the social security checks.

So Obama wasn't lying, or incorrect. If we default on debts, social security payouts are one of the biggest debts.

It appears that you believe that obligations of the SS Trust fund are paid from the "earnings" on the treasuries and other government paper.
The fund is buying and selling treasuries, all the time, and when the fund requires cash to pay obligations, it sells treasuries, thus liquidity comes from earnings and sales of assests.
The managers of the fund should be selling treasuries, now, if they believe there may be a problem selling at reduced prices IF there is a default (5% probability).

101

S'latch Tue, Jul 12, 2011 12:12:29pm

re: #97 uncah91

I agree that one can have debt and live within one's means.

I do not agree that one can live within one's means by incurring additional debt to pay for preexisting debt.

If I lost my job and I had to borrow money to pay my mortgage, I would not be living within my means at that point. When and if I found a new job to pay for my mortgage, I would then again be living within my means.

102

Obdicut Tue, Jul 12, 2011 12:13:30pm

re: #100 mikiesmoky2

It appears that you believe that obligations of the SS Trust fund are paid from the "earnings" on the treasuries and other government paper.

Yep. The earnings and the sale.

The fund is buying and selling treasuries, all the time, and when the fund requires cash to pay obligations, it sells treasuries, thus liquidity comes from earnings and sales of assests.

Yes. That's what I told you. Why on earth do you feel you need to repeat it back to me?

The managers of the fund should be selling treasuries, now, if they believe there may be a problem selling at reduced prices IF there is a default (5% probability).

First of all, you can't sell ones that haven't matured, of the type that are multi-year bonds. Second of all, the interest payments as well as the actual sale form SS's income.

This is basically you saying that yes, you understand SS's assets are in US treasuries, but that they should plan for default by selling off whatever they can now to have a big cash bolus?

If they sell immature ones, they'll take a loss.

Do you have any clue how the sale of bonds vs. outpayments stacks up currently? It was my impression that SS already borrows some from the general fund to make payouts. So they don't actually have the capacity to sell more, quickly, without taking a loss.

Since SS is NOT doing that, Obama's statement was, in fact, true. He was not misinformed.

103

recusancy Tue, Jul 12, 2011 12:14:53pm

re: #101 Lawrence Schmerel

I agree that one can have debt and live within one's means.

I do not agree that one can live within one's means by incurring additional debt to pay for preexisting debt.

If I lost my job and I had to borrow money to pay my mortgage, I would not be living within my means at that point. When and if I found a new job to pay for my mortgage, I would then again be living within my means.

But that's the real world. Are you currently planning on being unemployed? Are you prepared for that possibility? If not then you are not living within your means because you aren't taking into account the risks of life, of which one is losing your job without notice.

104

Gus Tue, Jul 12, 2011 12:15:39pm

I kept trying to give Boehner the benefit of the doubt. I really did. Not anymore. Boehners has jumped the shark and is in serious knucklehead territory. I hereby bequeath Boehner the official "wingnut crown".

105

Eventual Carrion Tue, Jul 12, 2011 12:29:52pm

re: #37 Rightwingconspirator

One guy around here has pounded on this in page after page. I argue with him on his conspiracy / Kabuki theater presentation, but his facts about S/S monies are in order. S/S is utterly separate in funding. The money is there. So... WTF?

Who is going to print the checks, get them mailed out, etc.?

106

S'latch Tue, Jul 12, 2011 12:36:45pm

re: #103 recusancy

I actually am prepared to be unemployed at anytime without notice. I would access savings until I found another job. If unemployment continued for too long, I would start selling assets.

But, my point is that incurring additional debt to pay for preexisting debt is not "living within one's means." It might be done for a limited period of time to save a valuable asset, but it cannot continue indefinitely. And, of course, there are degrees of living outside of one's means. The smaller the degree, the longer it can continue.

The United States is not living within its means. We are incurring additional debt to pay for preexisting debt. Maybe we are doing it to protect a valuable asset (our currency?). The degree to which we are doing it is huge. I don't see how it can continue.

107

Political Atheist Tue, Jul 12, 2011 1:31:57pm

re: #105 RayFerd

That would be the A in SSA. The administrators, paid by the trust funds.

108

Political Atheist Tue, Jul 12, 2011 1:39:56pm

Mikiesmoky2 you may want to go to the current topic

Its still about SS and the fact the money is gone already... Oh and how Fox distorts the news.

109

SidewaysQuark Tue, Jul 12, 2011 1:53:33pm

I can't freaking understand the concept of why we have a "debt ceiling" at all. It seems to me to be the exact same concept as price fixing, only in reverse - complete anathema to any capitalistic concept of what money means.

Of course, it makes Republicans sound "conservative" when they say "we won't raise the debt ceiling", when it's really anything BUT fiscally conservative.

110

Eventual Carrion Tue, Jul 12, 2011 1:54:28pm

re: #107 Rightwingconspirator

That would be the A in SSA. The administrators, paid by the trust funds.

If the government shut down, would the "A" still be working?

111

Political Atheist Tue, Jul 12, 2011 1:57:07pm

re: #110 RayFerd

I would think so. Like I would expect the military to still function.

112

Funky_Gibbon Tue, Jul 12, 2011 2:18:47pm

Boehner seems to have missed the fact that most of the country’s voters (even most Republicans) are not in favor of burning the country’s economy just to preserve low taxes for the wealthy.

Not just the US economy but every other national economy around the world still reeling from the last time. The effects of their petty power games will be felt globally.

113

Basho Tue, Jul 12, 2011 3:36:25pm

there has to be one user here who thinks what Boehner is doing is awesome. explain to me why? there has to be another side to this story but i don't see it

114

S'latch Wed, Jul 13, 2011 6:12:50am

re: #113 Basho

New York Times, July 12, 2011, By DAVID LEONHARDT

"Polls show that most Americans are opposed to raising the federal debt ceiling. Even when the Pew Research Center included the consequences in its question — a national default that would damage the economy — slightly more people were against raising the ceiling than were for it."

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