S & P confirms Republican Brinkmanship Undermined AAA Credit Rating.
Politico: S&P: Skeptics fueled downgrade
S&P: Republicans Saber Rattling On Defaults Caused Downgrade. “S&P senior director Joydeep Mukherji said the stability and effectiveness of American political institutions were undermined by the fact that ‘people in the political arena were even talking about a potential default,’ Mukherji said. ‘That a country even has such voices, albeit a minority, is something notable,” he added. “This kind of rhetoric is not common amongst AAA sovereigns.’” [Politico, 8/11/11]
Leader McConnell Called Debt Ceiling “A Hostage Worth Ransoming” But at the Capitol, behind the four doors and the three receptionists and the police guard, McConnell said he could imagine doing this again. ‘I think some of our members may have thought the default issue was a hostage you might take a chance at shooting,’ he said. ‘Most of us didn’t think that. What we did learn is this — it’s a hostage that’s worth ransoming. And it focuses the Congress on something that must be done.’” [Washington Post, 8/2/11]
Senator Toomey Was Not Worried About Adverse Effects Of Default. “Andy Sullivan of Reuters asked Toomey if he worried it ‘would push the country back into recession if, for example, we have to suspend Social Security payments.’ Toomey wasn’t worried. ‘I don’t think it’s going to have an adverse impact on the economy in the days, weeks or perhaps even months that this would continue,’ he said, allowing that ‘this is not an optimal arrangement indefinitely.’” [Washington Post, 5/18/11]
Senator Toomey Said Failure To Raise The Debt Limit Would Only Amount to A Partial Government Shutdown. “Failure to raise the debt limit by August 2nd would not result in a default on our debt. There are no circumstances in which that need occur, because ongoing revenue to the Treasury is more than enough by a very large factor to ensure that we not default on our debt. Having said that, it would amount to a partial government shutdown, and that’s something that I for one would like to avoid.” [Press Conference, 7/7/11]
Majority Leader Cantor Called The Debt Ceiling A “Leverage Moment” For Republicans. “House Republicans will demand major concessions before agreeing to raise the nation’s debt ceiling, Majority Leader Eric Cantor (Va.) said on Sunday, setting the stage for another showdown over spending… ‘There comes at times leverage moments, a time when the president will capitulate to what the American people want right now,” he said. “They don’t want to raise taxes, they don’t want borrowing to continue out of control.’” [Huffington Post, 4/10/11]
Washington Post; “Cantor Is Latest Republican To Dismiss Importance Of Debt-Ceiling Deadline For Financial Markets.” House Majority Leader Eric Cantor (R-Va.) told reporters in Richmond Wednesday that financial markets watching discussions over raising the nation’s debt limit are looking to see progress on cutting spending in Washington — rather than a resolution of negotiations by any deadline. ‘What I think is that the markets are looking to see credible progress on changing the fiscal trajectory in Washington,’ Cantor said, after a job forum for local business executives at Virginia Commonwealth University. ‘The markets are not fooled by some date imposed to say that that is the trigger for the collapse.” [Washington Post, 5/18/11]
Bachmann Wouldn’t Vote To Raise the Debt Ceiling. “I will not vote to raise the debt ceiling.” [Statement, 7/11/11]
Senator DeMint Didn’t Believe In Consequences If America Fails To Pay It’s Bills.
Question: Do you believe, Senator, that the country risks default
or major economic consequences if the debt ceiling is not raised on
August 2nd — by August 2nd?
DeMint: No, I don’t. [Fox News Sunday, 7/11/11]
Senator Coburn Said A Debt Limit “Doesn’t Really Mean Anything” And It’s Not “Catastrophic.” On Meet the Press, Senator Coburn said: “Well, the only way we solve our very real problems is to start getting our spending under control. A debt limit doesn’t really mean anything because we’ve always extended it. And the, the, the Treasury secretary has the ability, even if this debt limit is not extended, he has the ability to continue to pay interest on our bonds. The, the idea that we might say that this is catastrophic is wrong, that what is catastrophic is continue to spend money that we don’t have on things we don’t absolutely need and continue to mortgage our future and not fix the very real problems that are in front of us.” [Meet the Press, 4/24/11]
Senator Ron Johnson Downplayed the Consequences of Failing to Raise The Debt Limit. Johnson said, “I am a little bit cynical about the scare mongering and putting America’s back up against this Aug. 2 deadline just to get an increase in the American credit card.” [Roll Call, 7/18/11]
Pawlenty Said Republicans Shouldn’t Raise the Debt Ceiling, Had No Idea What the Consequences Would Be.
QUESTION: President Obama has stepped into the deficit talks, meeting separately with Senate leaders Harry Reid and Mitch McConnell at the white house to try to offset a federal debt increase. How do you think the president is handling this issue?
PAWLENTY: We don’t know. The real test is coming up as the deadline approaches. Right now, as judged by outcomes, the answer is we haven’t done anything yet. The debt ceiling is going to be a fork in the road. My view is that the Republicans shouldn’t raise it. If they do, they need to get something permanent and structural and meaningful, the constitutional amendment, spending caps, and changes in the near term.
SCARBOROUGH: what’s the impact if it’s not raised?
PAWLENTY: Well, we don’t know that.
SCARBOROUGH: Well, I don’t know what’s going to happen to me if I jump off a cliff. But I think I’ll go splat. [MSNBC, 6/28/11]
Rep. Ron Paul (R-TX): Bankruptcy Could Be Cure For U.S. Debt. “Rep. Ron Paul (R-Texas) said Monday that bankruptcy could be the best solution for the United States to address its mounting debt. … ‘Are we going to experience — are you predicting in essence — if bankruptcy is the cure for Greece, is it also the cure for the United States?’ asked host Jan Mickelson. ‘Absolutely,’ Paul responded.” [The Hill, 6/28/11]
Republican Study Committee Chair Jim Jordan: “Keeping the debt ceiling at its current level would force Congress to prioritize spending, but it would not force a default on our debt. The only thing forcing a default would be Treasury Secretary [Timothy] Geithner allowing such a catastrophe to take place.” [Washington Post, 5/16/11]
Rep. Brooks (R-AL) Scoffed At The Impact of Default. “Scoffing at claims of economic calamity if the debt ceiling isn’t raised, Rep. Mo Brooks, R-Ala., said such statements are ‘absolutely wrong’ and ‘misleading the American people.’ Brooks argued that the government would still have enough revenue to pay its creditors.” [AP, 7/20/11]
Rep. Steve King (R-IA) Denied US. Would Default If Debt Ceiling Not Raised. “America is not going to default. We’re just trying to scare people into being stampeded into a debt-ceiling increase. But we would hold our full faith in credit together regardless, unless the president had decided to punish America by refusing to pay our bills.” [ABC News Topline, 7/20/11]
Rep Renacci (R-OH) Said US. Would Not Default if Debt Ceiling Not Raised. “Renacci said without incurring more debt, the government would still have enough revenue to cover debt payments and Social Security. ‘We will not default on our debt,’ he said. ‘So really the question becomes, ‘what don’t we pay?’’” [Canton Repository, 7/20/11]
Rep. Graves (R-GA) Refused to Compromise, Complained About Scare Tactics. “Conservatives in the U.S. House of Representatives are in no mood to compromise on federal debt, says U.S. Rep. Tom Graves, R-Ranger. … Graves also attacked President Obama’s claims that Social Security checks might not go out if Congress doesn’t increase the debt ceiling by Aug. 2. ‘These are scare tactics that are quite frankly unnecessary and below the presidency,’ he said.” [Dalton Citizen, 7/20/11]
Rep. Todd Rokita (R-IN) Doesn’t Believe the US Will Default if We Don’t Raise the Debt Ceiling.
QUESTION: Is August 2nd an important date in your mind?
ROKITA: Of course. But I don’t take the premise that we’re going to default on our obligations. [ABC NEWS Topline, 7/18/11]
Rep. Todd Rokita (R-IN) “I Am Not Worried About Moody’s.” Rokita said, “I am not as worried about Moody’s or anyone else as this economy gets worse.” [ABC NEWS Topline, 7/18/11]
Rep. David Schweikert (R-AZ) Said Worrying About Default Was “Silly” “The one acting like his hair is on fire is Mr. Geithner. It’s absolutely silly. We have plenty of cash flow to pay debt, which means I’m trying to figure out how credibly the administration can keep using that language.” [Politico, 5/17/11]