COMMENTARY | By definition, default is a failure to meet an obligation. In one week, if Obama and Congress cannot reach a debt ceiling agreement, the United States of America faces sovereign default for the first time in our history. In the event of a nuclear economic meltdown, as president, Obama knows he will be standing at ground zero.
Economists say interest rates will skyrocket and the stock market will plummet, sending ripples through the global economy. Moody's is threatening to lower the U.S. credit rating and, because the interest rates consumers pay are tied to what the federal government pays, interest rates for consumers will also rise. And the wheels on the bus go round and round ...
Flashback: While facing default on their $24 billion deficit in 2009, California Democrats refused to allow budget cuts to solve the state debt crisis. The Republicans wouldn't allow tax increases. Sound familiar?
When Obama revealed his FY2012 plan in February, it became clear he planned to tax his way out of debt. Offering only $1 trillion in spending cuts, he proposed 43 tax hikes to gouge an additional $1.5 trillion from Americans over the next decade.
Perhaps someone should inform the fiscally naive president that California's record tax increase of $13 billion didn't solve that state's economic problem.
Obama gave another speech from the White House Monday saying that Republicans want "an approach that doesn't ask the wealthiest Americans or biggest corporations to contribute anything at all." He forgets that the top 10 percent already pay 70 percent of the nation's revenue, according to The Heritage Foundation, and American businesses already pay the highest corporate taxes on the planet, per the Daily Caller.
"We were elected for the same reasons," Obama said Monday. Well, technically that's true. In 2008 Obama promised to cut government waste and balance the budget by the end of his first term. In 2010, Republicans were given control of the House on their vow to start the process for him.
Obama said most Americans "don't understand how we can ask a senior citizen to pay more for her Medicare" before we ask corporate jet owners to "give up tax breaks."
Newsbusters reports those corporate jet tax loopholes came from Obama's stimulus plan.
"For the first time in history, our country's AAA credit rating would be downgraded," Obama said.
Indeed.
In April, Rep. Paul Ryan produced a plan to reduce spending by $6.2 trillion over the next 10 years with no tax increases. Obama and the Democratic Senate said no.
House Speaker John Boehner proposed a "two-stage" plan to increase the $14.3 trillion debt ceiling while reducing the federal debt going forward. Obama said no.
The Gang of Six plan had everything Obama wanted. But just after there appeared to be an agreement, Boehner revealed on Fox News Sunday that the president changed his mind and said they "need more revenue." This time Boehner and Cantor "said no."
Jennifer Rubin of the Washington Post reported Monday that Senate Majority Leader Harry Reid (D-Nev.) and Sen. Mitch McConnell (R-Ky.) had cobbled the framework of another "two-part plan." It involved a short-term increase - with cuts greater than the increase - combined with a committee to find long-term savings before raising the debt ceiling further. Reid even took the bipartisan plan to the White House himself. "The President said no."
Gallup pegs Obama's approval rating at 43 percent. A recent CNN poll shows his approval down among liberals. A new Washington Post-ABC News poll reveals a third of Americans believe Obama's policies are hurting the economy and that confidence in his ability to create jobs is eroding rapidly among his base.
Sen. Bernie Sanders, an Independent who snuggles with Democrats, said "President Obama could benefit from a primary challenger over the next year," according to The Hill.
Ouch.
Obama's running out of time and caught between a rock and a hard place.
In Monday's speech, Obama said "balanced approach" seven times. However, while saying "compromise" six times - once to claim that Washington had become a place where "compromise" was a "dirty word" - as Major Garret of National Journal acutely observed, "there was a far dirtier word he didn't utter -- Veto."
The debt ceiling will be raised. Just as Weebles wobble but they won't fall down, we are America. We stumble but do not default on our obligations.
Like Boehner said, "The president's worried about his next election."
Obama is stalling, bluffing. He's holding a bad hand and wants to blame Republicans for his cowardice in perpetuating a global economic poker game while hedging his own bet with another $2.4 trillion of taxpayer chips.
In one week the United States of America faces sovereign default for the first time in our history. Obama's doubling down.
At this point, Republicans should call his "bluff." Obama knows he's stuck with a pair of unprecedented cards that will ultimately define the legacy of his disastrous one-term presidency.
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