Obama’s debt ceiling dilemma: Americans oppose increasing it by a 2-1 margin

by editor on April 26, 2011

Hoo boy, what’s a socialist President to do? He needs to raise the debt limit so he can keep spending, needs to increase the debt limit to satisfy his political base, but a new poll indicates that he’d be punished in the polls for doing it.

obama-debt

Want more money? Just crank up the printing presses and let 'er rip!

CBS News reports Obama’s awkward situation:

Despite Obama administration warnings that failing to do so would devastate the economy, a clear majority of Americans say they oppose raising the debt limit, a new CBS News/New York Times poll shows.

Just 27 percent of Americans support raising the debt limit, while 63 percent oppose raising it.

Eighty-three percent of Republicans oppose raising the limit, along with 64 percent of independents and 48 percent of Democrats. Support for raising the debt limit is just 36 percent among Democrats, and only 14 percent among Republicans.

Note that 48% of Democrats oppose raising the debt limit. That means the President is appealing only to the extremists in his own party when he says, “This has worked so well that we should do it again.”

To tell the truth, we’re not actually sure they the extremists. They may actually be morons.

Source: CBS News

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Robert
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Robert

I’ve been working in the financial sector most of my life, and I got a master in business, yet all I (and my colleagues) can say is: we don’t really know exactly how things would unravell. But I can tell you this: It would be really bad for everyone!

There has never been a similiar case in history. No country as important to the world economy as the US has ever defaulted on its debt. Remember when Greece almost when bankrupt? For me that was one stressfull week at the office. The whole financial market went crazy! And keep in mind that Greece has a GDP of about $330 billion while the US GDP is about $14.1 trillion.

Now, the reason that the financial markets whent nuts is that unlike popular conception, a lot of the $13.9 trillion debt is owned not by other nations but by banks and by regular people. There are many pension funds and other savings/investment-programs that has a large exposure to US bonds (basically IOU’s issued by the goverment).

The reason that so many investors and banks etc deposit money in US bonds is because we have never, ever defaulted on our debt. And is therefore seen as an extremely safe investment.

Therefore, if the US would default on the debt – many banks would probably declare bankruptcy due to that high exposure to the US. If the banks go dry, that means no more credit – for any one. Most larger business relies on short time credits to pay salaries since money doesn’t always come in at the same time as payments are due. That means many companies would not be able to pay their workers on time, if at all. And of course you could no longer take loans for anything either.

Neither could you withdraw any money from your accounts at the ATM, because the banks wouldn’t have enough. As of right now most banks only have 1/3 as much money as they loaned to others (look up fractional reserve banking).

And last but not least, the dollar would basically crash. The “full faith and credit” of the US is basically what is holding the value of the dollar up. It is considered a very reliable currency because of the reliability of the US. With that gone, the dollar decline would be unlike anything you have seen so far.

hisham
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hisham

Well, Robert, scratch my previous post to YT, it doesn’t sound good at all. What happened to Mr. Ponzi should happen to Geithner, et al.. It sounds to me like the gubmint has been running a BIG Ponzi scheme for a long time now and their house of cards is about to come tumbling down! No, that does not sound like a good thing at all!

Robert
Guest
Robert

I fully agree with you there Hisham. Extremely excessive spending have gotten us here and those responsible should be held accountable for their actions. And we should definetely cut government spending, but defaulting on the debt is a no-go. Instead, we need to cut spending with about 30% – and fast.

Can you Imagine that? They right now spend so much that for every dollar they spend, they need to borrow 30 cent!

If I had my office overshoot budget with 30% i’d be getting some pretty angry calls from the higher ups, and then I’d be out on my ass in no-time!

hisham
Guest
hisham

If we actually delcared bankruptcy and defaulted on our loans, how bad would that be and who whould it hurt the most…big government, big bankers, big speculators, The Fed, George Soros?

YT
Member
YT

Mostly gov’t but pension funds and foreign gov’ts too. Most of the debt is owned by the fed now and you’d think pension funds would have moved out of gov’t debt to get some sort of return.

I say just declare the fed’s charter void and the govt holdings of its own debt worth zero and pay the foreigners.

hisham
Guest
hisham

Hey, I’m no banker, but your idea sounds good to me.

Tatersalad
Member
Tatersalad

Barack Obama’s man made gasoline price predicament :

Open ANWAR for drilling and to produce our own oil instead of buying it from foreign countries at inflated costs while keeping the speculators at bay and to keep our money right here in America

Add up items #1 thru #8, putting the most emphasis on #8 and you will have the cost of America’s gasoline costs:

1. http://www.youtube.com/watch?v=MlfmvwxxgHM

2. http://therealrevo.com/blog/?p=44337

3. The President of the U.S. is now giving $2.84 Billion taxpayers dollars to Columbia to build an oil refinery. I thought we needed jobs here in the U.S.? This President is a complete loser and it now shows he hates America.
U.S. Gov’t Agency Plans $2.84 Billion Loan for Oil RefineryIn Colombia

4. http://wizbangblog.com/content/2011/03/11/enough-oil-to-completely-replace-all-imports.php?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+Wizbang+%28Wizbang%29&utm_content=My+Yahoo

5. http://canadafreepress.com/index.php/article/35840

6. As Your Gas Climbs To $5 a Gallon Obama’s EPA Blocks Access To 27 Billion Barrels Of American Oil – http://www.americans-working-together.com/together_we_can/id36.html

7. Is Saudi Arabia mad at Barack Obama for allowing Egypt to fall? http://grendelreport.posterous.com/saudi-slashes-oil-output-pres-obama-launches

8. The problem that contributes the MOST to high gas prices is Quantitative Easing (QE2) by the Obama administration and here is why: http://www.futuresmag.com/News/2010/11/Pages/Oil-after-QE2.aspx

Printing more money tends to push down the value of the dollar. While that would tend to help U.S. exports, it also risks pushing up the price of oil and other commodities, threatening an inflation surge that could be difficult to stop if the economy picks up.

9. After reading and watching all of the above information provided, there is still one question that needs to be asked and hopefully YOU have the right answer for the 2012 election. How is this “Hope & Change” thing working out for Americans of all parties now? http://www.moonbattery.com/archives/2011/04/hope-change-2.html

YT
Member
YT

QE just makes foreigners rush to unload their dollars faster. When the levee breaks so much money will come flowing in to the US everything not nailed down will be bought and taken back overseas.

Buying whats left of america’s capital wealth doesn’t equal exports. It would equal exports if there wasn’t that whole problem about China and Japan holding tons of the debt.

That makes the 3rd option, outright default even more appealing.

DJ
Guest
DJ

Well, I’m glad someone earned a paycheck by polling the obvious: ‘Obama will be punished at the polls for doing it.’

This video sums it all up perfectly with a catchy tune, to boot!

http://youtu.be/LO2eh6f5Go0

Ed Wallis
Guest
Ed Wallis

“Punished in the polls”?!
Since just *when* did that deter this jerk?!

danybhoy
Member
danybhoy

“Show me what democracy looks like…This is what democracy looks like”
Repeat several dozen times in a droning, monotone chant.

BTW, the constitution does not deter him either. Obama rules, he does not govern, besides he does’nt know how to govern.

hisham
Guest
hisham

He doesn’t know how to rule either!

danybhoy
Member
danybhoy

“Show me what democracy looks like…This is what democracy looks like”
Repeat several dozen times in a droning, monotone chant.

BTW, the constitution does not derer him either. Obama rules, he does not govern, besides he does’nt know how to govern.

RockingHorseGuy
Member

I would prefer he was punished in the polling place to being punished in the polls. Along with every politician that votes to raise the artificial “ceiling.”

Jim Stewart
Member
Jim Stewart

I’d like to raise my foot into the behinds of the people who vote to increase the debt ceiling.

danybhoy
Member
danybhoy

Is there really a debt ceiling if it always gets raised when they come up against it?

sifi
Member
sifi

I don’t look at it as “raise the debt limit” but rather digging the hole deeper. A hole we will never climb out of till it starts getting filled in.

RockingHorseGuy
Member

Very good question, danybhoy. Kind of puts the lie to the whole argument, doesn’t it?

danybhoy
Member
danybhoy

Thank you RHG, & yes it does.

rs
Member

Has anyone checked Obama’s transcript to see if he flunked Econ 101?

Ruben
Member
Ruben

We would try but it is locked in the same safe deposit box as his birth certificate.

By the way, being opposed 2-to-1 didn’t stop this naked Marxist from ramming through Obamacare so this won’t be any different.

RockingHorseGuy
Member

You can’t flunk if you never even took the class.

Sailingbum
Member
Sailingbum

Perhaps they are “extreme mOrons”??