Toomey Backs a Default by Any Other Name, Showing Tea Party Leadership Again.
Philadelphia, PA - Senator Toomey has once again shown his extreme ideological colors, this time by backing a U.S. default on its obligations with his opposition to raising the debt ceiling.
U.S. Sen. Pat Toomey willing to call White House bluff on catastrophic federal default
- Senator insists nation can avert default by prioritizing bills
Both the Treasury Department and financial analysts agree this could lead to Armageddon. But not Toomey and the Tea Party. Just 'pick and choose' which obligations to pay, Toomey says. And his choice: bondholders, including China....then the rest of us, leaving 35% of all U.S. obligations unpaid.
Can it be done? Every day the U.S. Treasury Department receives two million invoices and pays millions of invoices. How could it possibly be suddenly 'jury-rigged" to prioritize millions of daily payments every day through a complex computer system that is now set up to make each payment when it comes due?
But even if bondholders could be singled out as first to pay, what do you then prioritize after that: a veteran's benefit, pay for FBI, a Medicare patient, or a defense contractor, and which ones? Moreover, a research note by Goldman Sachs outlines the dire consequences if bondholders' interest could be paid first, while setting other payments aside: a recession with a GDP decrease of 4.2%. This is a sure default on the trust of the American people that they will be the priority of our government!
What's Toomey's endgame? Here it is:
First, last May Toomey filibustered the Senate's budget from going to conference with the House Republican Budget. Without a conference resolution, funding would be unavailable to avoid an eventual government shutdown on September 30.
Then, on "Morning Joe", Joe Scarborough asked Toomey "why" he obstructed this normal budgetary procedure of Congress. Toomey's answer revealed his goal: he didn't want to chance that the conference might raise the debt ceiling during its negotiations.
Even Republican Scarborough was amazed, "But has this ever happened before that somebody has held up a budget like this because they're afraid of something that may come up, that nobody is suggesting will come up." Toomey's reply: he didn't trust the House Republicans who might, "...pretend there is no debt ceiling and allow the government to keep on borrowing." Extreme! Not to trust House Republicans led by Paul Ryan!
It's why Toomey's vote to close the government with 18 of the most extreme Senators was headlined by the Philadelphia Magazine as "Toomey joins Wacko Bird Caucus."
And why the day after the Government shutdown vote, it was no surprise that only Toomey voted "No" on the Senate request for 'unanimous consent' to once again send the Senate budget to conference with the House of Representatives' to end the shutdown.
And it is why his extreme colors become even more evident as five Pennsylvanian Republican congressmen have said they would now vote to re-open our government immediately without a change to the Affordable Care Act (Obamacare) -- but not Senator Toomey. It is not part of his plan.
So now, having been successful at blocking a federal budget, Toomey's real extremist goal has been made more possible: his legislative proposal that forbids the U.S. debt ceiling to be raised - the first default (by whatever name) ever by the U.S. Government - while directing the U.S. Treasury to first make interest payments to foreign governments before it makes good on domestic obligations, such as seniors' Medicare subsidies and payments due to our servicemen and women.
It is a proposal that caused the renowned economist, Paul Krugman, to say of Toomey, "This is a guy walking into a crowded room and saying, 'I have a bomb strapped to my chest, if you don't give me what I want, I'm going to blow up everybody including myself...there are some pretty crazy people."
This is pretty extreme governance by anyone's standards. But Senator Toomey explained it best himself at a Tea Party-sponsored event after he had filibustered the Transportation bill. Caught on an open mic as he spoke in an aside to a fellow Tea Party representative, he was heard to say by a reporter, "We did something constructive today. We denied cloture to the THUD [Transportation] bill. I told you we'd kill it, and we did."
Such extremism can overreach, and Senator Toomey not raising the debt ceiling epitomizes it.