NWV News - Raising Debt Ceiling Will Hasten U.S. Destruction, Say Economists

RAISING DEBT CEILING WILL HASTEN U.S. DESTRUCTION, SAY ECONOMISTS

By NWV News writer Jim Kouri
Posted 1:00 AM Eastern
February 14, 2011
© 2011 NewsWithViews.com

While progressive Democrats and RINOs -- Republicans In Name Only -- in both houses of the U.S. Congress continue to push the nation closer to economic ruin, Obama administration members and the majority in the Democratic Party are telling Americans that the U.S. debt limit must be raised.

If the debt ceiling is not raised soon, the U.S. monetary system will collapse and Americans will face catastrophes they never imagined could exist, according to Democrats in the White House, the U.S. Senate and the House of Representatives.

Yet, polls show an overwhelming number of Americans don't want to see the debt limit or ceiling raised. A Reuters/IPSOS poll reveals a surprising statistic: a whopping 71% of Americans are against raising the ceiling.

In a recent letter he wrote to the U.S. Congress, Treasury Secretary Timothy Geithner said: "Failure to raise the limit would precipitate a default by the United States default would effectively impose a significant and long-lasting tax on all Americans and all American businesses and could lead to the loss of millions of American jobs."

Geithner went on to paint a dismal picture that threatened Americans with soldiers and veterans not being paid or medically treated, the elderly would lose their Social Security benefits, and other nations would lose more confidence in the U.S. dollar. Geithner's doomsday scenario includes his forecast of a recession worse than the one we have now, or even a depression, reminiscent of the Great Depression that began in 1929 and lasted until World War II.

One of the methods being used to deal with out-of-control spending is monitizing the debt, a term that until the Obama administration was unknown to most pundits and citizens. Simply put, according to economist Tom Spencer, monitizing the debt means printing more paper currency.

But utilizing such a remedy only postpones the inevitable and increases inflation.

In fact, in order to hide the climbing U.S. inflation rate, government bean counters removed two major household expenditures: Food and energy. The government therefore ignores what anyone who shops at a supermarket and drive an automobile knows -- prices are rising substantially and rapidly.

Which may explain why most Americans don't recognize the U.S. is on the "eve of economic destruction."

RAISING THE DEBT CEILING

What make many economists nervous is the skyrocketing budget deficit under President Obama, which many believe will hit more than $1.7 trillion this year. At the same time, according to Dr. Spencer, the national debt is expected to reach its legally allowed maximum of about $14 trillion over the next few months.

Spencer said that by 2020 the national debt it will be more than 85 percent of our national economy and by 2035 it will be reach an astounding 180 percent.

"If Congress ultimately inclines toward raising the debt limit or ceiling -- or whatever they call it this week --then it should make drastic cuts in spending including cuts of "sacred entitlements" with new regulations aimed at sharp spending reduction in the coming years," Spencer noted.

But Mike Baker believes it's up to the Republicans in Congress to get the job done.

"That is the goal of the Tea Party's campaign that has been launched to encourage majority GOP members of the U.S. House to force the government to live within its income by leaving the debt limit alone. It is the freshman Republicans and staunch conservative/libertarian GOP members who feel beholding to the Tea Partiers. The Democrats either ignore them or resort to name calling as do their comrades in the news media," Baker advised.

The House GOP leadership had lunch with Obama on February 9 and came out sounding rather conciliatory, according to syndicated talk host Laura Ingraham.

"While Republicans continue to sort out their spending cut proposals, the Democrats are standing back and waiting to pounce on any specifics. President Obama must use the bully pulpit to convince his own party that entitlements are for tackling, not expanding. Is he up for the challenge?" asks Ingraham.

But then Ingraham said, " Don't count on it. From Biden's $53 billion for high speed rail to Obama's billions for better Internet speeds, it seems this administration is only interested in one thing: more spending!"

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With 71 percent of those surveyed opposing any increase government borrowing authority, the focus of the fiscal battle over should be over federal spending since only 18 percent support an increase in the debt ceiling.

Republicans who wrestled control of the House of Representatives from the Democrats in November did so by promising to stop big government programs favored by Obama and the majority of Democrat lawmakers. Republicans also vowed to slash $60 billion from the budget as soon as March, but many of those cuts are not likely to be popular with some segments of the public.