During his press conference yesterday, President Barak Obama explained that Republican demands requiring a match in future spending cuts to cover an increase in the federal debt ceiling is like finishing a meal a restaurant and leave without paying. This is an imperfect analogy.
While it is true that people and businesses do indeed negotiate debts and payments after the fact — something many Republicans certainly would be familiar with, perhaps routinely in business for some — the United States government does not, or at least historically has not. The Republican caucus — again making the mistake of thinking about government as if it were a big private business enterprise — seem to be willing to extend this practice to our fiscal policy.
Republicans are willing to do this not because it is smart practice, but because it helps them achieve their broader goal of cutting government. Plain and simple. That simply compounds the disaster the GOP is set on creating for the United States, indeed the world economy as a whole.
There is a somewhat better way to make the restaurant bill payment analogy, nonetheless.
What Republicans are doing is demanding lower future costs in consideration of current payments. It is even more nuanced than that, however. Republicans are not saying reduce the current bill or we are leaving and not paying, they are saying sell me less next time I dine at your restaurant or we are not paying.
Imagine you’re the restaurant owner. You’d think: Well, ok, order less next when you’re here next time and I’ll gladly serve and charge you less, but pay me now for what you just ordered.
In my previous post I explain why it makes sense for the GOP anti-government strategy to order big and then play games with paying. It all has to do with tricks to cut government, a failing strategy that ultimately damages our immediate economic recovery. (NB: The economy is not the GOP concern nor is the deficit. Less government is their goal. Running up debts and deficits actually serves that goal.)
But, in essence, Barak Obama is absolutely correct. Republicans want to renege on contracts and promises already made unless future contracts conform to their wishes. Ok, fine…the GOP wants the future to be different, but rather than demand lower prices for what they already have ordered they can simply order something less expensive in the future. If you look at the restaurant analogy, one has nothing to do with the other.
- Starving the Beast or Foie Gras? The GOP Deficit Hostage Strategy (mbcalyn.com)
- Republican Senator: GOP Should Hold Debt Ceiling Hostage As Leverage For Medicare Cuts (thinkprogress.org)
- Krugman: Republicans Are Engaging In ‘Hostage Taking’ (huffingtonpost.com)