By JEFF KAZMIERSKI, COPY EDITOR
Sometimes I really hate being right.
Last year, riding a wave of partisan rancor, anti-tax faux populism and general hate-mongering, the lunatic fringe of the Republican party (hereafter referred to as the “Tea Party”) swept into power a collection of the most incompetent bunch of unqualified amateurs ever elected. Rep. John Boehner (R-Ohio) assumed the podium as Speaker of the House and then completely failed to exert any actual leadership over the freshmen caucus. They’ve proceeded to take a wrecking ball to anything they didn’t like, from the recently passed Affordable Care Act to environmental regulations. Facts don’t matter – everything they’re against is supposedly “job killing” and must be destroyed.
A few months ago I wrote about the needlessly partisan bickering between the President and the Republicans. At the time I predicted an even worse round of fighting over the national debt limit. Many of these newly elected representatives had little or no background in public policy, and even less knowledge of economics. Debt is bad, they say, and therefore raising the debt ceiling is a bad idea. Taxes are also bad, they say, and therefore raising taxes to increase revenue cannot be allowed to happen. According to the Tea Party, deficit reduction can only be achieved through spending cuts. Armed with their appalling ignorance and unwillingness to compromise (which many see as weakness), they have been holding the nation hostage.
And so, while the deadline approaches to raise the debt ceiling or drive the nation into default, they refuse to compromise on even the most reasonable tax issues.
Give them what they want, or they’ll push the nation off a cliff. You know, we used to have a word for people who would willingly and intentionally harm the country.
National default, if allowed to happen even for a short time, would be a very bad thing. For the short term, interest rates would rise. Maybe not by much at first, but even half a percentage point would have immediate and lasting impact on an already-struggling economy. Mortgage rates, which have been falling recently, would suddenly rise again. Rates on credit cards, car loans and student loans would go up. That last should make any student think twice about whether the Tea Party is right to pursue this course of action. I know many of my fellow students are Republican, and while I respect this choice, I don’t understand it. Why any student would voluntarily align him- or herself with a party whose policy positions make it harder for us to achieve our goals is beyond me.
But I digress.
The credit ratings agencies, Moody’s and Standard & Poor’s, have been hinting for a few weeks now that if the debt limit isn’t raised, and soon, America’s credit rating could be downgraded. Currently our rating stands at “AAA”, the highest anyone can have. Downgrading it would reduce the credit rating of every American citizen.
Here’s the crux of the problem. The United States government currently borrows 41 cents of every dollar it spends. If we hit our debt ceiling in August, that borrowing power disappears overnight, resulting in an instant spending cut – and not in a good way. Just because we’ve maxed our credit card doesn’t mean we don’t still have bills to pay. Social Security checks won’t get mailed, construction contractors won’t get paid, road work and public works projects will grind to a halt. And remember the troops serving overseas, keeping us safe from terrorism? They won’t get paid either, though the wars they’re fighting will still have to be paid for. Veterans’ benefits will stop. And (this should get your attention) Pell grants to students won’t be paid either.
And that’s only the beginning. Because in the middle of August we have an interest payment due on the national debt. Remember that? The debt the Tea Party wants to fix by not allowing us to make it bigger? We still have to pay on it. And we’ll have a lower credit rating by then, so the interest rate will have gone up, making the payment even larger than it would have been.
Governments have basically two ways to raise revenues. They can borrow the money, which every government does at some point but none wants to do. While necessary, this is not the best way. The money needs to be repaid, and the loans carry interest. It’s the equivalent of paying your bills by using your credit cards. The other way is through taxation, which again, every government does but is politically unpopular. People don’t like giving up “their” money to the government. On the other hand, people also like having a smoothly-run government that provides essential services like road construction, police, public works and the post office. Because taxes come from the citizens of the country and anyone who does business within its borders, taxation is like the country’s paycheck.
That ought to be simple enough to understand: borrowing is living off our credit card, taxation is living off our paycheck. Which do you think is more fiscally responsible?
Of course, the Tea Party doesn’t see it that way. Both are bad, and the only way to balance the budget is by cutting spending – on things they don’t like, of course, such as Social Security, Medicare, aid to the poor, and veterans’ benefits. Eliminating pointless and wasteful expenditures like tax breaks for corporate jet owners and subsidies for oil companies are off the table because they’d somehow be “tax hikes.” Such is the twisted logic of the modern Republican Party.
Hard choices must be made, they tell us. But from their actions it’s clear they’re not willing to actually make any of those choices themselves – only on behalf of the rest of us. Their refusal to budge on taxes, and boundless willingness to make the masses suffer for their political gain, is reckless cowardice.