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Senate Scheming How To Pass A Stealthy Debt Ceiling Boost
As the inevitable breach of the $12.1 trillion federal debt ceiling looms, with the official debt figure now at $11.95 trillion, Senate Democrats have started to ploy how to best pass the resolution without attracting much if any public attention. Yet, with this issue now actively on everyone's radar screen, it will be interesting to see just how this can be accomplished. Politico reports that Democrats are now planning on considering the debt increase provision to a "must-pass" bill such as the DoD spening bill. As Politico reports: "Adding it to the defense bill would allow Democrats to argue that they voted for the measure to help troops in harm’s way — and downplay that their vote also expanded the limit for how much money the country can borrow."
Unlike those of the House, the Senate’s rules do not allow it to automatically increase the debt with its adoption of the annual budget resolution. That puts senators in a tough position politically. And if the Senate balks at the increase, Treasury Secretary Timothy Geithner has warned that the slow economic recovery could collapse, as investors around the world would sharply lose confidence in America’s abilities to meet its credit obligations.
While Republicans expect all 40 members to vote against a debt limit increase, the unity even within the Democrats is questionable.
“Regardless of the political treachery, I’m more worried about the economic treachery and the monetary aspects of it with devaluing the dollar,” said Sen. Ben Nelson (D-Neb.).
Senate Budget Committee Chairman Kent Conrad (D-N.D.) and the committee’s ranking member, Sen. Judd Gregg (R-N.H.), whose panel is in charge of the debt limit increase, both told POLITICO that appropriators may add the language to must-pass spending legislation.
And Conrad said he wants any debt increase to be coupled with language that would create a “comprehensive” process to force Congress to begin making tough choices to cut the debt — something akin to legislation he and Gregg proposed that would establish a commission to study ways to cut the deficit, whose recommendations would be fast-tracked through Congress.
Sen. Evan Bayh of Indiana, a centrist Democrat, said he wouldn’t support an increase in the debt limit “unless there’s some mechanism to start getting the deficit under control.”
With the daily dollar pounding now becoming a mainstream issue, it is only a matter of time before the debt ceiling topic also trickles down for general public regurgitation. At the end of the day, the question boils down to how massive debt increases now can be spun as necessary to contain debt increases, and in fact to reduce debt, in the future. If history is any precedent it will be difficult to convince a public, increasingly skeptical of the Administration's economic policies, that this move will be in the best interest of Americans. Additionally, if the Senate continues to underestimate America's sensitivity to this issue, and indeed tries to sneak the debt provision through, it will only turn even more people against Obama's debt exploding strategy. In the meantime, the Treasury is running out of ways to optically keep the debt under the ceiling: the clock is ticking on the Senate, and the longer it delays to have a unified approach to resolving this critical issue, the higher the likelihood of a major backlash when it finally does happen.
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These politicians are such liars. How many of them really want to balance the budget? Anyone? Anyone?
yep. they're liars.
just to demonstrate said liars in action:
NC Senator Burr applauds money from stimulus bill he opposed
http://www.starnewsonline.com/article/20091020/APN/910201551
Joe Biden
OMFG.
These people are cowards.
The resolution to increase the debt should and must be debated as a stand alone, not piled on as an amendment to obfuscate the issue and provide cover.
Thank you for keeping up the pressure on this issue ZH.
This is the same dance we see each time they raise the debt limit.
Senators will vigorously support or object to raising the limit; depending on which party conrtols the White House.
Same as it ever was
nice, now the opposition can capture 2 birds with 1 stone:
promote fiscal responsibility & bring the troops home.
Ron Paul would be licking his chops with this one.
too bad the House already passed...oh well.
According to the Fed and Treasury, the recession is over, but unless we give the banks more money at 0% the economy will collapse... If we don't bring our budget deficit under control, it will destroy the dollar, but unless we raise the debt cieling the economy will collapse. Am I going insane, or is this really happening??
I'm sharpening my backlash blade as we speak....
What will be interesting to see is how much they raise it by. They are not going to want to be faced with raising it again in the near future and the way this country is spending money, the trajectory of such spending will dictate a substantial increase.
Any guesses?
I'm going with $13.9T
"3M Co gained 2 percent to $77.88 after the diversified manufacturer reported stronger-than-expected earnings and raised its full-year forecast on demand for consumer electronics and respiratory masks."
Going forward, MMM stock will continue to appreciate as consumers wanting to survive the deadly H1N1 epidemic, increase their purchases of respiratory masks. There is a real possibility for a run on respiratory mask inventory and an ensuing inflationary shortage crisis.
On another encouraging note, TRV profits rose and costs fell as benefit payouts and the population continued to decline due to the flu and rampant heart desease aggravated by a steady diet of Big Macs. MCD was up 5% on the NYSE.
Maybe if the debt ceiling is not raised, that will be the catalyst to resurrect the dollar? We need to monitor this closely. It could cause a major "dislocation" in the market.
There's not a chance in hell that it is not raised. If not formally, then informally.
Spending trajectory and declining tax revenues makes it a forgone conclusion.
Buy Silver.
This entire "where can we hide Waldo" mess reminds me of a real life conversation I overheard while working in a bank.
This middle aged man walks into the lobby and asks to see the manager. He was directed to my assistant because I was on the phone. Fortunately I overheard the discussion.
In a nut shell, this man was chronically over drawn and was bouncing checks left and right. It didn't take long for him to raise his voice and declare to anyone within earshot that he wasn't responsible for the over drafts because the bank should make him stop writing bad checks.
So help me God his exact words were "The bank should make me stop writing bad checks." Short of tying him to the chair and giving him an IV drip, I had no idea how to satisfy his request nor why he would think we were the responsible party.
Does this sound like a group of people near and dear to our hearts?
The bank should never have allowed him to write bad checks. Period.
nor good checks.
And right there is the insanity of the system and of us as individuals. Common sense would have indicated that the bank should close the account. But I would never have been able to justify doing so to my supervisor because the guy was paying a fortune in fees to the bank on a monthly basis.
As long as he (eventually) deposited enough money to cover the bank fees, we kept the account open. Only if he didn't pay the fees would we consider him a "bad" customer.
I lasted about 6 months in banking because I had one basic problem. I had ethics and I always ran into moral dilemmas. I didn't feel the lowest common denominator in banking should be if the bank was making money.
I'll never forget the day I tendered my resignation. My supervisor told me I lacked the killer instinct and he called me a looser. I sure as hell didn't feel like one then or now. We all need to be able to look in the mirror in the morning. I can.
ZH is making democracy more informed and democratic every day.
This angers me.
But as The Prophet Zacharias Manuel de la Rocha said, "Anger is a gift."
I will go clutch my fire-spitting steel and dream of the day when it's use will have become inevitable and necessary.
I am Chumbawamba.
Chumba, gonna run with the music thing, if you don't mind...
I was in the gym last night when Guns 'n Roses "Get In the Ring" popped up on my ipod, completely forgot I even had that song.
Anyway, as I was popping my glutes or pounding my pecs or whatever the lingo is the kids use these days, I thought how cool that song would be re-written as an anti-congresscritter/TBTF/fascist-faux-patriot rant.
Especially Axl's riff in the bridge, but leave it the same when you get to the "you wanna antagonize me?" part.
"And that goes for all you punks in the press
That want to start sh*t by printin' lies
Instead of the things we said
That means you
Andy Secher at Hit Parader
Circus Magazine
Mick Wall at Kerrang
Bob Guccione Jr. at Spin,
What you pissed off cuz your dad gets more
p*ssy than you?
f*ck you
Suck my f*ckin' dick
You be rippin' off the f*ckin' kids
While they be payin' their hard earned
money to read about the bands
They want to know about
Printin' lies startin' controversy
You wanna antagonize me?
Antagonize me motherf*cker!
Get in the ring motherf*cker!
And I'll kick your b*tchy little ass, punk!"
I am sure that Congress must hurry to pass the higher debt ceiling limits before their creditors increase the fees later this year. Just like peons credit card companies new fees and legislation.
They have to make sure there's enough room in there for their salary increases.
I am Chumbawamba.
Goldman has their back on those paychecks. Let's see 535 x $174,000 = $93,090,000 which isn't even a rounding error to the $16,000,000,000 in bonuses.
FREE SERGEY
Come on boys ... show some guts. Make it a stand alone bill. I'd like to see the debate on C-Span.
BTW: I'd like to have your guess as to how long this increase is going to last so I can determine whether you're doing a good job or not.
We need to unelect some of these buggers in 2010 and see if we can get their attention.
Vote with Guns.
I am Chumbawamba.
we're number one, we're number one.
treasury just announced yet another record auction of funny paper for next week.
we're number one!
I had a dream last night...that the FED controls congress...very odd. They were like a puppet master with their marionetts...
It was no dream.
Our Senators and Congressmen and women are, in the aggregate, perilously close to being out and out traitors. I know that sounds absurd, but from the standpoint that continuing to raise the debt ceiling brings the U.S closer and closer to a currency dislocation, such as occurred in The Weimar Republic and Argentina, for example, our legislator's actions are deeply injurious to the health and welfare of The Republic.
Using the cover of "we did it for the troops" is patent bilge, they are doing it for self serving reasons. There is no admixture of altruism. I invite readers here to visit http://americanrevt.blogspot.com It's a humble site, not nearly as comprehensive as ye olde Zero Hedge, but you may still find it worthwhile.
Finance theory dictates ideal debt levels can exist, but at a certain point, higher debt levels are more and more egregious. There comes a point where higher debt cannot even service short term interests at expense of long term. Those senators think they can surreptitiously increase the debt ceiling without immediate consequence. I think we're getting to the point where the consequences may be felt immediately, not simply postponed.
Debt is good, it makes us rich.
I am Commander Cody.
TARP money will never be returned
Allison Says TARP Needs ‘New Direction’ as Markets Stabilize
http://www.bloomberg.com/apps/news?pid=20601087&sid=atr7bTgUTd2s
Jezus F'ing Christ
WTF is the point of having a debt ceiling when they just raise it whenever they want. What a complete and utter charade!
There is no discipline left. The only thing that's clear is that the system is like a gas... it will grow to fill the space it inhabits. In this case it will continue to spend money that it doesn't have because the idea of "checks and balances" died in 1987.
"Sen. Evan Bayh of Indiana, a centrist Democrat, said he wouldn’t support an increase in the debt limit “unless there’s some mechanism to start getting the deficit under control.”"
Ha! Ha! Ha! Good one, Evan.
It is obvious that most in congress believe that the increase in the debt limit is to run the government. Timmy is not asking for a mere trillion or two. If he is, he is wasting his time. Because he knows he needs at least 4 trillion to give to Bernanke to give to the big boys. Remember, we day laborers do not know what the true amount of bad assets is on the big boys’ books. Bernanke is not so foolish as to tell the congress no to disclosure if, he did not intend to pull the same trick again. The general consensus is that, when the commercial real estate loans become weed control mulch in the Garden of Eden we are all doomed. It is obvious that the big boys have not been reimbursed their full losses yet, because we have to raise the debt ceiling higher than the cost of government requirements.
If you're going to be irresponsible and increase the debt limit time and time again, why don't you attach it to Term Limit legislation?
That would seem to me to be "essential" legislation, would it not?
No, making sure our guns are loaded is way more important. Never know just who might want to get boisterous with us. Or, for that matter we might just want to get boisterous with others.
Elizabeth Warren for President
But I’d like to see it get talked about anyway. The way I look at it, the problem with the Democratic Party is not the voters, it’s the 19 or 20 people who are paying for the campaigns and sitting in at those meetings with Rahm and Billy Tauzin. We have to get rid of those people, herd them all to the edge of a very tall cliff and push them off and be done with it. I think this can be done by electoral referendum if we actually put it all on the table openly and let people decide for themselves. And maybe it takes an electoral cycle or two to get it done, but it has to get done. This stuff won’t get fixed otherwise.
We need someone in there who is willing to run one this one issue: who owns the Democratic Party? Is it the voters, or is it Goldman Sachs and Morgan Stanley and United Health Care? There are plenty of candidates out there who’d fit — Toledo’s Marcy Kaptur got a nice bounce from the Michael Moore movie, and Jan Schakowsky is another who comes to mind — but Warren to me makes the most sense for the simple reason that it will be virtually impossible for the Democratic Party hacks to dismiss her as a fringe character, given that they themselves gave her such a big public position as chief of the Congressional Oversight Panel.
http://trueslant.com/matttaibbi/2009/10/22/elizabeth-warren-for-president/
We should attach the debt ceiling increase to the real essential legislation - the RP audit the fed bill. After all, we are all surprised that they have already spent through the first $12.1 trillion debt ceiling limit, and we have no idea what they spent it on and what friends of the printing press they gave it to because the audit the fed bill has not passed.
Congress should withhold Ben Bernanke's confirmation approval for his second term and refuse to increase the debt ceiling until:
*Confirmation the $12.1 trillion is accounted for
*Ensure transparency through auditing the fed (agreed provision)
*Ensure the funds are not used for any big bank bail outs - TBTF's nationalized instead if they need future funds
*And most importantly but understated: AUDIT THE $600 TRILLION" In DERIVATIVES AT THE TBTF's. I'll say it a gain in case you missed the all caps "shouting" - Audit the $600 trillion in derivatives at the TBTF's. It is merely a shell game between the fed and the banks, so you have to audit them both.
I thought the Fed's balance sheet was off the 12.1T debt ceiling balance sheet so to speak.
We can stop a lot of the current nonsense if we get
our congresscritters to vote this down.
most americans think the debt ceiling is where losers on dancing with the stars go for a final consolation dance....
if george bush thinks that the consitution is a "goddamn piece of paper" i can asure one and all that the senate has even less compunction about going over the debt ceiling....
sheeple move along and go fuck yourself as you do....
I am laughing so hard that I am soiling my nickers--I mean people take this Seriously--Really?