As most of us are preparing for the holidays a small clique in the Senate, with their collaborators in the Washington punditry, are planning for a dramatic hostage-taking event. Their target of opportunity is a bill to increase the nation's debt limit. The hostage-takers propose to obstruct the bill's passage unless the rest of the country gives into their demands to cut Social Security and Medicare and takes other steps to meet their warped sense of fiscal responsibility.
The debt limit must be increased at regular intervals in order to allow the government to function normally because the government is currently operating at a deficit. If the debt limit is not passed, then at some point the government will not be able to pay workers and contractors. It won't be able to send out Social Security checks or make payments for Medicaid and unemployment insurance to state governments. And, it will not be able to make interest payments on government bonds, effectively defaulting on the national debt.
As a condition of allowing a bill to increase the debt limit to pass the Senate, the hostage-takers are demanding that Congress agree to establish a special commission to make recommendations for reducing the long-term budget deficit. This commission would be stacked with people who want to cut Social Security and Medicare.
When the commission makes its report to Congress, which would include huge cuts for these programs along with some tax increases, the report would not be subject to regular Congressional procedures. It would be fast-tracked, which means that it could not be amended, debate would be limited, and there would not be the usual 60 votes required to bring the report to a vote in the Senate. In short, the deck would be stacked toward approving large cuts in ways that would not ordinarily be the case.
The hostage-takers argue that such a commission is necessary because the current system is broken. This is another way of saying that the hostage-takers have been unable to get what they want through the normal democratic process. Rather than trying to organize popular support for their position, like people pushing for health care reform, restrictions on greenhouse gas emissions, or an end to the wars in Iraq and Afghanistan, this group of senators and their collaborators prefer the route of hostage-taking. They hope that by threatening the passage of a vital bill, they can advance measures for which they lack public support.
This adventure in hostage-taking is especially infuriating since this gang did so much to push the country into its current economic crisis. At a time when some of us were trying to warn of the housing bubble and the economic disaster that would inevitably follow in the wake of its collapse, this crew was filling the airwaves and newspapers with their scare stories of huge deficits in 2050. Of course, these deficits were driven almost entirely by the cost of maintaining a broken health care system, a point that they rarely chose to highlight.
As a result of the bubble and its collapse, we have enormous deficits today, in addition to 15 million unemployed and tens of millions of homeowners underwater in their mortgage. But the hostage-takers act as though nothing has changed. They acknowledge no responsibility for this disaster and just press on in their drive to gut Social Security and Medicare, two programs that are now more important than ever as a result of the economic mismanagement of the last decade.
The key here is to refuse to give in to the hostage-takers. This is a high stakes game of chicken, but at the end of the day, the hostage-takers, many of whom are financed by Wall Street money, stand to lose far more than the rest of us. None of us should want to see the government defaulting on its debt, but if this crew wants to press the matter, the Wall Street gang will lose much more than those of us who don't possess great wealth.
The Wall Street gang may have suckered us with getting the TARP bailout money last year, but we don't have to let them get away with the same trick again. If they want to threaten to crash the financial system with their irresponsible hostage-taking, then we should steal a line from a former president: "bring it on!"