Congress hears outcry from business lobby on debt ceiling and deficit

[savalez]

Source: Wash. Post

A sprawling coalition of Wall Street and Main Street business leaders sent an unmistakable message to lawmakers Tuesday: Enough squabbling. Get the debt ceiling raised.

The message, sent in a letter to President Obama and every member of Congress, puts pressure on GOP lawmakers, who have staked out an uncompromising stance against raising taxes in the partisan wrangling over the country’s borrowing limit.

Republicans rely heavily on corporations for political support and have regularly cited the opinions of these “job creators” in their opposition to new tax revenue. Many of the House GOP freshmen most opposed to a compromise were swept into office with the help of financial support from groups behind the letter.

But the business community, which has largely kept quiet on the issue until now, does not uniformly share the Republican orthodoxy on taxes, according to some lobbyists who helped craft the statement.

Read more: http://www.washingtonpost.com/business/congress-hears-outcry-from-business-lobby-on-debt-ceiling-and-deficit/2011/07/12/gIQAiVGpAI_story.html

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The so-called "job creators" are getting nervous.

[DJ13]

1. The so-called "job creators" are getting nervous.

They should have smacked their pet Congress members when they first started yapping about using the ceiling as a bargaining chip.

[roguevalley]

14. they have buyer's remorse, the slaggers.

[whosinpower]

2. That is why this whole game is grand theatre

We all knew, or at least should have been savy enough to know that Wall Street simply would not accept the United States defaulting on its debt obligations.

I knew they would blink - they have THE MOST TO LOSE. We all do - but it would surely cost them, by far the most.

[whosinpower]

3. That is why this whole game is grand theatre

We all knew, or at least should have been savy enough to know that Wall Street simply would not accept the United States defaulting on its debt obligations.

I knew they would blink - they have THE MOST TO LOSE. We all do - but it would surely cost them, by far the most.

[PoliticAverse]

4. And this is why there won't be a default... n/t

[robinlynne]

10. Then in is time for Obama to put some major taxes back on the national table right now

and stfu about social security.
no disrespect intended, just don't know how else to say it clearly.

[Cirque du So-What]

5. As I've asserted since the spectre of 'hitting the debt ceiling' first became a boogeyman...

It would never have been allowed to happen. The plutocrats would put key repugs in body bags before allowing them to send the US government into default.

[aquart]

13. Really? Perhaps we should hold out a bit longer.

That's very mean of me.

[Cirque du So-What]

18. Don't think that hasn't crossed my mind as well

:evilgrin:

[Bozita]

6. So Mitch's offer yesterday was based on inside information

Fucking assclown!

[ShockediSay]

7. And the 'job creators' spiked unemployment with the Bushy tax cuts holiday,

created the Great Recession and added imho 4 trillion in national debt.

[robinlynne]

11. in your opinion and in fact!

[Kahuna]

8. That's why mcconnell and boehner seemed close to tears yesterday..

What a dressing down they must have received.

[LetTimmySmoke]

20. It might have sounded something like this:

"I know your main priority is to go after Obama, but my main priority is to my shareholders. If you don't stop this now, we are going to fucking bury you."

[robinlynne]

9. Well then, now congress will listen. oh the irony.

[aquart]

12. The guys they paid so much money for are upsetting them?

Grinning from ear to ear.

[RickFromMN]

15. Can some people, with economics backgrounds, please explain the consequences of a default?

I believe a default would be bad for some people.
How would a default increase the pain of people already hurting.

I wish to understand, specifically, who would be hurt and who would not by a default.
I wish to understand who would be hurt more by a default?

For example, workers and the poor are already suffering?
How much more would they suffer if we default?
Health care is a disaster for those who can't get health insurance through work.
Medical bankruptcies are real.

I assume some corporations are hurting at this moment, while other corporations are not.
Would corporations that are already hurting go out of business?
Would corporations not currently hurting start to feel pain or worse?

Would corporations that import or export be hurt more than corporations that are local?
Would the service industry be hurt less than the manufacturing industry?
Would would happen to the financial industry?

There are times I wish the financial industry would feel some pain.
I blame the financial wizards, and their financial instruments, for a lot of the current pain.

I assume the rich will not be hurt.
The rich will move their money elsewhere if they haven't already.
Please tell me I am wrong...please tell me the rich will feel some pain if we default.

I assume we will pay more in gasoline and certain food items.
We truck food across the country; would this go up?
Would locally grown food prices go up less?

Gas prices going up may be a bad thing in the short run, but may be a good thing in the long run.
Oil shortages might force us to conserve more and find alternate energy sources.

People say we will lose jobs if we default. In which industries?
Would some industries be immune? How can people, already out of work, suffer more?
It will be harder to find employment. Isn't it already impossible to find employment?
I heard, on All Things Considered, our GDP must grow by 3% to have reasonable job creation.

Would companies and banks go under, like the Great Depression of 1929?

Would the Democrats or Republicans benefit more if we default?
I suspect the people who would suffer more are Democrat leaning.
Would the people who vote Republican feel the pain and become Democrats?

I'm reminded of a truism, it's a recession if my neighbour is unemployed.
It's a depression if I am unemployed.

Perhaps if more people feel the pain, including people who envision becoming rich,
we will get needed reforms. Perhaps we will get Medicare for all.
Perhaps the pain will get us to care for our suffering citizens because we will share their pain.

Perhaps we will finally do something about corporations too big to fail.
Perhaps we will finally do something about the financial wizards who almost wrecked our economy.

I assume a default will be bad and painful.
I can't believe the pain will be uniformly shared.
I have to believe our country needs some pain to come together and care for our fellow citizens.
I have to believe we need some pain to get needed reforms.

Wasn't it the Great Depression that gave Roosevelt enough clout to implement needed reforms?
Wouldn't another Great Depression give us the incentive to implement more needed reforms?

[safeinOhio]

16. Everybody is for a war in the beginning.

when the pain, deaths and suffering comes, not so much.

Old and sick folks on SS and Medicare would die without any support. Many, many companies would go out of business for good. Unemployment might sky rocket. Be very careful what you wish for.

[dmallind]

17. Theoretically....

bear in mind the "default" is not like a family not paying the mortgage. The US would still honor all debt interest and maturity, it would simply not be able to borrow any more.

S it would have to fund expenses from cashflow. This means on average $23B a day could not get paid.

Nobody knows what would get cut first. The only constitutional protection is for covering the debt. My guess for first cuts would be:

Payments to states and other institutions - anything from helping to build roads to subsidizing research. If shortfall cannot be made up the roads don't get built and the people building them are SOL.

Federal payrolls get cut to essential staff only - lots of licenses and permits don't get done so more work stops. Passports aren't issued so those people don't travel, cutting the need for airline and customs staff, travel agents, desk agents, etc etc.

Procurement spending is severely reduced. This not only hurts big ticket items like new planes and ships (which are built by "little people" working for "the rich" - who do you think has more cash to cover the interruption in income) but cuts the need for millions of workers who sell goods and services to the Feds, from safety inspectors to accountants to janitors and landscapers.

Foreign aid (< 1% of spending BTW). See how Pakistan responded this week? Multiply by 50-100 countries.

Essentially the whole multiplier effect of federal spending, where building a bridge gives money to the contractor, thence his employees, thence all the merchants who sell to them, and so on, goes into a grinding reverse.

And then you hope UE benefits and welfare doesn't get chopped.

The pain will, as always, be felt worse by the poor. Not only are they likely more dependent on direct government transfer, but they are more likely to be cut when the work dries up (one contractor, 10 executives, 75 middle managers all of whom work on supporting a range of production lines, or 500 assembly workers who have specific jobs on specific lines that may or may not run any more). They are less likely to have cash cushions either.

I do not buy the 'we need pain to pull together' idea. What pain does to most people is make them lash out and blame "others" for their problems. Risking Godwin here, there is a reason Hitler's xenophobic and anti-semitic extremism was popular - foreigners and Jews were handy scapegoats for the economic turmoil of 1920s and 30s Germany. Americans won't finally realize we need a better social safety net when the money stops flowing - they will blame those whom they perceive as taking all the money so that it "ran out" - immigrants the poor, etc.

The real bugger is the Feds only spend really huge sums of money on three things outside debt interest: Defense, medicare/medicaid and social security. Anybody who thinks either would escape cuts when we have 1.7T less to spend annually is nuts. Won't be the first to be cut, but they will be cut.

[RickFromMN]

19. It would cause another Great Depression then?

I bet welfare will be one of the first things chopped.
If only that would cause the poor to vote in large numbers.

I would think the "rich"...those people who got the Bush tax cuts, would get lots of blame.

As long as the Republicans think the Democrats are afraid to see this happen,
the Republicans will play a game of chicken, refusing to compromise.
We may all go over a cliff if the Democrats don't back down, but so be it.
It's better everyone go over a cliff than watch the poor, the elderly, the sick go alone.

I agree with those who say this is a horrible scenario.
Given the political climate and actions of the opposition, this scenario must be considered.
The alternative is appeasement. Are we going to be like Neville Chamberlain or Churchill?