Recently by Eric Blair: 5 Key Principles that Unite Populist Progressives and Tea-Party Libertarians
In the fall of 2008, during the lead up to the TARP bailout of the financial industry, Treasury Secretary Henry Paulson warned members of Congress that there will be Martial Law in America should they fail to pass the multi-trillion dollar looting of the taxpayer.
Well, despite the American public being overwhelmingly against the bailout, the blackmail worked and the banks got their money. If it worked once, why not try it again?
With the economy no better off for having borrowed trillions to "stabilize" criminal financial institutions, the national debt ceiling is rapidly approaching. As some Republicans begin to float the notion of blocking this extension of credit, the Treasury Department, Democrats in Congress, and Ben Bernanke issued apocalyptic warnings clearly showing how pathetically fragile the U.S. economy is.
These threats, reminiscent of Paulson’s 2008 ransom demands, once again appear to be offering two black-and-white choices: Armageddon or more debt. The coordinated pitch for higher debt levels is echoing the same urgency as the TARP looting, as Treasury Secretary Geithner said the government is insolvent and will run out of money in about two months’ time unless Congress votes to raise the federal debt ceiling.
The AFP reported Thursday that Senate Democrats warned that the government would "shut down" if the debt ceiling was not raised. Chuck Schumer (D-NY) explained what that would mean if a shutdown were to occur: "citizens couldn’t get their checks, veterans couldn’t get their benefits, military payments would stop."
Ben Bernanke doubled down on the debt-fear campaign in a rare press conference where he said, "Beyond a certain point . . . the United States would be forced into a position of defaulting on its debt. And the implications of that on our financial system, our fiscal policy and our economy would be catastrophic."
Fiscal conservatives who oppose raising the debt ceiling say it is just delaying necessary belt-tightening and massive spending cuts, and say that raising the debt ceiling further only forestalls needed austerity moves to avoid a more catastrophic collapse in the future. House Republicans presented a plan to cut $32 billion from the budget, which is laughable given the impossible-to-pay-off debt levels.