The Debt Limit: America's Hostage Crisis
My column in Forbes is up. Here is how it starts. Hit the link to see it all.
We Americans are all being held hostage. The ransom demand: Trillions of dollars in new taxes. The threat: the shut down of any number of economic activities, from retirement payments to mortgage lending.
Megan McArdle, blogging at the Atlantic Monthly, posted a hypothetical list of what government activities would have to cease if we bumped up against the debt ceiling and 40% of government activity (ie the amount currently funded by deficit spending) had to cease immediately. Here are two examples from her article:
The market for guaranteed student loans plunges into chaos. Hope your kid wasn’t going to college this year!
The mortgage market evaporates. Hope you didn’t need to buy or sell a house!
Terrorists have tried for years to find some way to threaten the whole of America and have, with the exception of 9/11, never really succeeded. Who knew that all they really needed was not to buy guns and bombs, but to get elected to Congress. How did we ever get in this position, where a handful of men and women in Washington had the power to hold the entire economy hostage?
