>

Well, yeah. They would be reckless not to. The Republican party is reckless for even considering defaulting and letting it go this far.
What will this mean for other government employees? Like state employees are often funded by state or county budgets but that is with money coming down from the feds. If we default, that money doesn’t come. >

It will have a catastrophic, trickle down effect.
Depends how much money your state gets from the feds. California may be fine. Louisiana and Mississippi? Good f’ng luck >

This isn't the trickle down effect I was promised >

They let losses trickle down, but not gains. >

Socialize loses privatize gains.
We don’t live in a capitalist world.
We live in a Corporate Socialism one. >

No, you live in a Capitalist one. The whole point is to externalise losses and internalise gains, nothing to do with Socialism.
This is the end-game of Capitalism. This is what happens when your entire system is based around owning private ownership of Capital.
The people with the most Capital bribe the people in charge and politically manipulate the system to their advantage. >

The is absolutely insane.
Modern economics uses an extremely important number that we call the "risk free rate of return" and abbreviate as Rf.
This value is fundamental to modern finance. It's the number that let's you find the current value of any guaranteed future payment.
Economists combine this with other risk factors to do most of the predictive modeling you've ever heard of. Stock pricing models, Black-Scholes even simple mortgage calculations.
The thing is, nobody really knows the true value of RF. All we can do is observe actual rates of return and assume that Rf is some part of it.
In practice, we use US government debt to estimate Rf. Why? Because, historically, it's the only interest rate that reflected 0 investor expectation of default.
The US has never defaulted. Ever.
And this is the really strict definition of default where even a second late payment would count. The US hasn't done it.
Historically, the US has been so reliable about paying back debt that investors assume that the US will always do so. If you lend the US money, you will 100% get your money back, on time and with all interest owed, come hell or high water.
Right now the US has a perfect record on debt repayment.
There's no way to get from a nearly perfect record back to a perfect record. >

The last time they dicked around the US debt was downgraded. >

That was for just getting close >

They might as well downgrade now. I have absolute faith in Republican obstructionism, they will hold the World’s economy hostage and trigger a global recession in an attempt to score political points.
e: To those saying “but the donors!” The donors are fine with this. Remember all those record profits you’ve been hearing about for the last few months? They can take the hit, and in return, everything else suddenly got cheaper, perfect for expanding the portfolio. They’ll come out ahead, just like last time. >

And they don't even know what they want. They are demanding "cuts," but refuse to specify how much and from which areas. Instead, they are demanding that Biden and the Democrats bring them a plan with cuts so they can give their thumbs up or down.
It's like trying to negotiate with a kidnapper who tells you to leave a suitcase full of money in a location and they'll get back to you on whether it's enough for them since they haven't decided on a ransom demand yet. >


And they don't even know what they want.

They want to destabilize the global order.  That's all they want.  Because when they do that, global fascists movements will have their necessary window, to implement their desired political movements at warp speed, once there is enough public unrest to foment dissent, and manufacture consent for atrocities. >

No half measures >

Gotta whole ass one thing. >

I'm out of the loop I guess, but I thought this was squared away?
And if it isn't, what would this mean for everyone if we did default? >

So, and someone with more economic knowledge than me can explain further, but basically there is a debt ceiling that is separate from the budget that Congress passes. Congress already passed the budget, but the debt ceiling was not passed at the same time. The money is already spent, but now the debt ceiling must be raised or by a certain date, the US will just stop paying its bills. The Republicans want to change what’s already been agreed upon, and Biden is just like “uhhh fuck no you agreed to this” 
If the US does default, it’s going to mean serious economic repercussions. All over something that is frankly absurd. >

They've done this dance for decades though haven't they? Every time they raise the debt ceiling cause otherwise imminent financial collapse will follow >

Yeah but thats the point. Republicans are doing everything they can to cause economic collapse in an attempt to make Biden and Democrats look bad. >

But following that economic collapse all their campaign donors will suddenly see interests rates spike to the moon. They wont exactly be happy they cant fund any development, construction, or even basic financial projects anymore. No company can expect a bailout if they fuck up etc. Nobody other than Boebert and Green would be that stupid to actually follow through on this game of chicken >

They'll just blame democrats for the negative repercussions and their voters will believe them.  It's 2023, I'm surprised this still needs explained about republicans >

I just got recommended some bullshit Fox News headline today that was some clickbait shit to the tune of "crime rate rises in Democrat-led tourist destination". Also saw a bunch of billboards before the election about how "most violent protests occur in Democrat-led cities."
The playbook here is insanely brazen. The fact that people fall for it might be even worse. >

everyday there is at least one post that reads, "lawlessness and chaos erupt in dem led city" >


“We have to be prepared for that, not only in this country but in other countries around the world,” Bank of America CEO Brian Moynihan told Poppy Harlow on “CNN This Morning” Monday. “You hope it doesn’t happen, but hope is not a strategy — so you prepare for it.”
Bank of America CEO: We're preparing for possible US debt default

Pretty huge difference in tone between what the headline make it sound like he's saying and what he actually said. >

Correct, because anyone with a brain realizes this is the same stupid brinkmanship they’ve been pulling for decades to secure concessions despite being a minority party and no serious observer believes it will end in default. >

The head of the IMF was on 60 Minutes last night. She basically said that if people in the US haven’t liked inflation up until this point, defaulting would cause prices to go to a place people REALLY won’t like. I guess as long as they’re sticking it to the libs, that’ll make them feel better? >

As long as Congressional Republicans can blame it on Biden, they don't care about the damage it will cause. It's all a political game to them - the lives of their constituents be damned. >


they don't care about the damage it will cause. 

No, they do care.  They’re actively trying to create damage to blame on him, which is much worse. >

It's shockingly immoral, isn't it? >

It's indefensibly immoral and yet 50 to 70 million people continue to vote for them every 2 years.  Makes you wonder where those peoples' morality is. >

They're moral because it owns the libs, who are immoral by default.
At least that's how they see it. >

I remember during the Roy Moore saga that a Republican voter lamented having to choose between a pedophile and a Democrat, as if that were a difficult choice to make. >

That's how it is with these people. Republicans can do literally anything they want and their base will excuse them by saying "well at least they aren't a democrat." One of my friends has a relative that's conservative and she's even said "I don't like Republican policies, but I just can't bring myself to ever vote for a Democrat" so she votes straight ticket R every election. Like how the fuck do you even get through to someone like that that's that deeply brainwashed? >

You don't.
You can try to educate people. And some of them will hopefully finally see reason. And if you educate enough people then the ones that refuse to see reason will eventually die of old age and hopefully sometime in the next few decades things might start to get better. 
Or you can speed things up with violent revolution, but that's more of a short term thing. Violence begets more violence so long term you wouldn't really be solving anything, just galvanizing the opposition by being the aggressor. >

I don’t understand this quote, “The unemployment rate has stayed very low. Extremely low,” Moynihan told Harlow. “That’s one of the challenges for the Fed.” 
So, is he saying that one of the challenges for the fed is to INCREASE unemployment? >

Yes the Fed has traditionally relied heavily on using higher unemployment to curb inflation. 
The old (current) models presume higher employment rates cause inflation. We need a new model that shows how corporate subsidies, corporate tax breaks, stock buybacks, and depressing the minimum wage have resulted in nobody affording to be unemployed (people are working 2-3 jobs now), but the glut of inflation is not being driven by low income Americans struggling to survive. It is being driven by price gouging and other metrics. Money supply circulating among the top 1% dwarfs the money circulating among the bottom 80%. So the old methodology is not working. Thus, we have high inflation with low unemployment and we can’t seem to force the starving to go jobless. Oops. Yet, how could people working 2 jobs to make ends meet that used to only require 1 job actually cause inflation? Is it not more logical this is a result of inflation? 
Unemployment won’t go up because people are desperate to work. Desperate people aren’t causing inflation, particularly when they are effectively earning less (in terms of real dollars) than they were with 1 job. Trillion$ are circulating in the markets, chasing a higher yield. 
But, The Poors aren’t chasing those yields. They’re chasing survival. Hungry stomachs don’t invest for %. They borrow on payday loans from future earnings to eat today. Because tomorrow’s paycheck is pointless if you’re dead. 
The money chasing those yields is why inflation persists. The old models have been blind to this dynamic. I’m no Econ PhD, but Joseph Stieglitz has done solid work nibbling at these concepts. 
Government subsidies and bailouts to corporate titans have changed the way “moral hazard” impacts decision making.  When corporate profits are privatized but losses are socialized, what stops the corporate profiteer from gambling away the assets? There is no more risk. The risk trickles down. The profit gushes up. But that upward gush needs to park the $$ somewhere to increase its yield. 
Reinvestment in worker salaries didn’t happen. So the money didn’t circulate in the economy and diffuse in a way that could mitigate inflation.*
Instead it has pooled to a head like a pimple coming to a head. Or more like a blood clot about to burst the artery. 
Macro-Economic Stroke is the next phase. 
inflation isn’t just about how much money is in the market. It’s also about how diverse* that money is spread through the market. If you drop a trillion dollars into one town’s economy overnight, it’ll suffer massive inflation, theoretically.  But if 1,000,000 towns see 1 trillion infused evenly over all of them, it would be a much less immediate impact. 
Concentration of wealth is itself inflationary if that wealth parks in the same place. Or same few places. 
There will be a cadre of orthodox economists who will call this analysis heresy. But I’ve learned that zealous orthodoxy is when insecurity meets arrogance. It is hard to accept new paradigms.  
As I say, I’m no Econ PhD. But these aren’t original thoughts to myself. >

this was an interesting read, thanks for writing it out >

So, BoA is planning on jacking up loan rates.  Good to know. >

I pisses me off that the republicans are playing chicken with the economy to score political points. They were in agreement with the spending but now don't want to pay for it. They've been campaigning with "the government doesn't work." and then do everything in their power to make the government not work. >


They've been campaigning with "the government doesn't work." and then do everything in their power to make the government not work.

That's exactly right. That has been the Republican strategy since the 80s. Prove government doesn't work by sabotage. >

Before that. Nixon and Kissinger ruined peace talks in Vietnam because "ending the war" was a campaign promise of Nixon. Can't end the war if LBJ ends it first. So he worked with N Vietnamese to sabotage peace negotiations. >


Kissinger was working for LBJ and was giving reports to the Nixon campaign.

why didn't kissinger have to go to prison for that? it feels like a crime? >

It is a crime—LBJ chose not to go public with it because he'd found out through a wiretap and was concerned about the optics.
Considering how ubiquitous the notion of the president ordering wiretaps has become, this is but one of many ways LBJ shit the bed. >

Imagine where we'd be as a country had LBJ hung Nixon and Kissinger for treason. >


Imagine where we'd be as a country had LBJ hung Nixon and Kissinger for treason.

This is a very strong argument in favor of prosecuting Trump and his cronies. >

Politicians never will do that because they know they all have dirty hands. If they make an example out of one, then they all could eventually be made into an example. 
Not saying that they shouldn’t, or that things would be better if we did prosecute them. I just doubt we will ever see true repercussions. >

We the people should probably start making some examples. >

Don’t worry everyone, the billionaires will be just fine. >

Republicans are the only ones pushing us to default, and don’t let anyone tell you otherwise. The party has been swallowed by a cancer of complete nihilists who don’t care who they hurt to make points, and not even good ones; their whole shit about cutting spending is a farce. Refusing to raise the debt ceiling isn’t a prudent fiscal move and has nothing to do with the federal budget, it just makes us deadbeats who can’t pay the debts we already owe and sabotages our country’s full faith and credit. That money’s already been allocated and spent, it’s gone. And then when they’re pressed on specifically what they want to cut they become sheepish and mumble about establishing a Congressional panel to look at the options.
Biden’s job market numbers are too good for them to stomach and inflation is cooling, and they’re licking their lips to inflict some economic pain on Americans and turn those good trends in reverse. That’s all this is about at the core. America doing well under a Democrat isn’t something to be celebrated for them, it is to be destroyed. >

Exactly this. The Republicans don't care how many people get screwed as long as they think they can score political points. >

The difference between Republicans and Democrats is Republicans will take the country hostage and hurt it to win. Republicans voted to raise the debt ceiling 3 times under Trump, and Pelosi and Democrats helped them even as they added $8 trillion to the national debt, a good chunk of it before the pandemic.
It’s like clockwork, every single time: a Democrat becomes president, Republicans rediscover their selective fiscal concern after going on a spending binge while cutting taxes to pile it on the debt, and the gun gets pressed straight into America’s head again. >


It’s like clockwork, every single time: a Democrat becomes president, Republicans rediscover their selective fiscal concern after going on a spending binge while cutting taxes to pile it on the debt, and the gun gets pressed straight into America’s head again.

It's called the Two Santa Clauses theory. It's basically been the GOP playbook for 50 years. >

Thanks for the link. Unfortunately, with their "trusted" pundits and out of control social media, It looks like they will continue to convince the public of their bullshit.
The thing about the GOP is that they don't give a shit what happens to the poor and middle class and they're extremely good at spreading their propaganda. It's amazing what can be accomplished when you don't have a care in the world what happens to other people - other than how much money you can squeeze out of them. >

Is this the fiscal responsibility people are looking for when they vote Republican? >

14th amendment Section 4:

The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.

Not raising the debt ceiling is unconstitutional and outside of the powers of Congress. They shouldn't even be able to debate not raising it because defaulting on the government's debt is literally unconstitutional. >

If that was a thing, then the law creating the debt ceiling would be considered unconstitutional.  Which it probably is with a plain reading of the section. 
So Biden and co can tell the fed to ignore the debt ceiling and pay the bills anyway they can. But that’s unlikely to happen. >

It almost certainly is. The problem is that they've never not raised the debt ceiling, so there has never been a legal test of its validity. Unfortunately, a law being unconstitutional does not provide standing for a suit in and of itself.
Congress can make all the unconstitutional laws they want if no one is negatively affected in a way that gives them standing to stop it. >

Isn’t the point thought that, even without an ability to start the legal fight, everyone can just ignore the unconstitutional law until congress tries to enforce it in court?  Thereby opening it up to discussion of its constitutional value?
Though I would guess that the executive has legal standing wrt getting both a ‘pay for this order’ bill and a ‘we won’t give you money to pay for that order’ bill. >

Yes, exactly. If I was president I would ignore their demands and this whole act, and publicly let everyone know that Congress doesn't have the power for this action and we won't entertain the idea of a US default. >

Sooooo….  Why don’t they? >

I suspect the issue would be challenged legally by Republicans, causing it to go to court.  While that litigation is playing out creditors may not be paid, which is still financially destructive, so it’s still best avoided if possible. >

I would hate to go down in the history books as the Justice who wrote the injunction that forced the United States to default on its debts and plunge the global financial structure into chaos. >

Unfortunately I'm not sure six SCOTUS justices feel the same as you do. >

Maybe if you would stop supporting people who would actively crash the economy and this country.... >

The thing is… the people who are voting for these clowns do not think they will be impacted by the debt default.
They somehow think it will only impact liberal states. Or not even a deeply. 
Many of them think that the chaos will not impact them at all, economically.
They live in a world where this is hysterical, and if it does happen, they truly think they’re separate from the consequences that will directly destroy their lives.
If they even think that deeply about it at all. >

Republicans like to demonize Venezuela but boy are they trying to push the US in that direction at times. >

And if they do, they'll blame "socialist communist" policies while ignoring that they gave massive tax breaks to the rich that greatly contributed to the current debt. >

Yep, and they have "respected" pundits willing to sell the country out so they can pull in more money by pushing the right wing agenda. >

They won’t allow a debt default. All these shitty Republicans have money in the stock market, and their donors absolutely do as well. If there’s one thing you can count on, it’s Republicans acting in their own self interest. >

I would have believed you before MAGA took over the party, but if there’s one thing I’ve learned about them, it’s that they mean all the batshit crazy stuff they say. >

as much as i hate republicans, the majority of MAGA conservatives lost their elections. there’s less MAGA-servatives than regular conservatives in the house. and those would vote with democrats to pay and raise the debt ceiling if need be. at least i would hope >

One of the more savvy things that Pelosi did during the Trump admin was immediately start referring to the “Trump shutdown”. She was on it so quickly, and I remember her saying it to his stupid face and he was like “Uhhh, what?” caught totally off guard. 
Democrats need to do this again, but call it the McCarthy shutdown. 
Obviously it’s more complex than that, but it doesn’t matter. Simple messaging. “McCarthy shutdown is why everything is fucked. It’s all McCarthy’s fault for his non-existent leadership.” >


“McCarthy shutdown is why everything is fucked. It’s all McCarthy’s fault for his non-existent leadership.”

I feel like there should be a name for this phenomenon.  I vote for "McCarthyism" >

Sounds like they should form a committee for un-American activities in the House, these McCarthyists >

This is the second or third recession of my short life? First ones I was a kid, but how do I deal with it as an adult living on my own? >

Cut back any discretionary spending to next to nothing. Dont take out any longterm commitments (ie dont buy a car, house, loan etc) unless absolutely necessary.  Reevaluate your budget for things that are wants rather than needs (ie. Multiple streaming services, maybe you still have cable and could switch to like tmobile home instead etc).  Most importantly dont freak the fk out and start doing stupid moves.  The economy is in fact cyclical and will come back youre just riding it out. >

Is it cyclical or is it just in a tailspin >

Picture a toilet flushing… >

All variations of a downward spiral lmfao >


Moynihan isn’t a fan of that idea. He told Harlow that “there’s got to be an argument about how we make sure we live within our means as a country” when asked whether or not the US should eliminate the debt ceiling.

Tell that to the fucking Republicans who decimated the treasury with tax cuts under President Orange Julius >

This all comes down to the fact that there are 222 House GOP members and 212 Democrats (one died). This is why voting in the mid terms is important. >

To be fair 222 is barely a majority because people voted in the midterms. 6 Republicans, 3% of the caucus needs to defect and this won't be an issue. >

This assumes that the speaker of the house will permit a bill to come up for a vote that is sane. If every bill brought up includes "abolish the IRS entirely", "end medicare and medicaid", "raise the retirement age to 85", etc, then there will be nothing presented that will ever stand a chance of being passed. >

Good thing McCarthy agreed to letting one person bring a motion to vacate as part of his agreement to get speaker. >

Man these crooks are willing to say anything to undermine the US economy so they can accumulate more assets before rates eventually go lower. >

Banking institutions preparing for the unprecedented assault on the United States by Republicans. The Republican war on democracy, the constitution and Americans themselves continues to escalate. Good people are called to rally - unite, organize and mobilize. Defend democracy. >

Yes, but the Bank Executives will still plow donation money's into the Republican politicians re-election campaigns.  The banks know the regulations will be relaxed by republicans, so they still want the illegal fraudulent credit system.
They are preparing for the worst, but the banks have been accelerating the risk of the US economy failing.
F*ing psychopaths! >

Bet they're not prepping "for the worst" but they're prepping how to profit. >

Let me guess, the solution is more bailouts to the already super rich? >

It’s been working flawlessly so far. >

BOA: We're going to take advantage of this situation because we're greedy as fuck. >

Wow. How broken can a government get before it collapses. >

That would be breaking the law so I guess we should be able to arrest those responsible and seiz all assets. >

All this because you will not tax the rich. >

"The economy will suffer."
No, the poor and middle class will suffer, the rich and politicians will get bailed out and continue to live like feudal emperors. >

There’s a solution—return to 80% wealth tax for Uber rich and 50% corporate tax rate for mega corporations and end subsidies for oil industry while taxing them on windfall profits. >

Yes, yes, the Republicans always scream about the debt and deficit and try to force the country into default then when they get in power they always increase the debt and deficit far more than the previous Democrat and put is into an even bigger hole.
How are these still people falling for this circus act? We've literally seen the same iteration of it for decades.
Anyone who thinks "oh if we just give them one more chance they will be fiscally conservative this time" needs their brain inspected. >

They’re still falling for it because they’re stupid. >

Serious concern, but completely sensationalist headline. 

The CEO of Bank of America (BAC), America’s second-largest bank, told CNN he hopes lawmakers resolve their issues, because the market and economy love stability. Yet defaulting on the country’s debt remains a possibility that cannot be ignored.  
“We have to be prepared for that, not only in this country but in other countries around the world,” Bank of America CEO Brian Moynihan told Poppy Harlow on “CNN This Morning” Monday. “You hope it doesn’t happen, but hope is not a strategy — so you prepare for it.” >

Does anyone else want to flush this guy down the toilet? >

Bank of America powering up their overdraft machines. >

The sooner the USA gets rid of a fundamentally two party system, the better. >

Could we just have 1 year without some fuckery of chaos. I beg of you. >

America is a collapsing empire, things are going to get way more chaotic before they get better. >

Oh we are defaulting on that debt. Republicans need to destroy the economy so they can blame it on Biden. >

I mean, you vote Republicans of the present vintage, this is what you get to wake up to.