The Daily Hatch

Clinton: We Will Have Bipartisan Resolution on Budget

During a fiscal summit sponsored by the Pete Peterson foundation Wednesday, Gwen Ifill talked to former President Bill Clinton about the economy, politics and foreign policy.

CNN Money reported on May 25, 2011:

Ryan, who spoke after Clinton at the summit, wasn’t asked directly about the New York race. But he did accuse Democrats of trying to use Medicare to scare seniors.

“Democrats are shamelessly demagoging and distorting this,” Ryan said. “Trying to scare seniors and (making) these things as political weapons creates political paralysis,” he said.

Clinton also weighed in on the most pressing fiscal issue facing policymakers: the debt ceiling. Treasury Secretary Timothy Geithner has said the ceiling, a cap on total federal government debt, must be raised by Aug. 2 to prevent the country from defaulting on its bonds.

The former president said President Obama should consider giving a national address to educate American voters about the consequences of a failure to raise it in time.

“They never lived through it; nobody knows what will happen,” Clinton said.

Clinton warned that political leaders “can’t be paralyzed,” and that they must find a bipartisan way to raise the debt limit, even if it’s unpopular.

“A lot of the most important things I did were unpopular,” Clinton said. 

Michael Tanner made some great observations in his article “Debt-Ceiling Myths,” National Review Online, May 11, 2011. 

Michael D. Tanner is a senior fellow at the Cato Institute and author of Leviathan on the Right: How Big-Government Conservatism Brought Down the Republican Revolution. Here is a portion of this recent article: 

Now that Osama bin Laden has been successfully dispatched to the eternal damnation he so richly deserves, Washington is ready to return to the more mundane question of whether the Obama administration will be allowed to spend this country into oblivion.

The next big fiscal fight will be over when and how to increase the debt limit. The administration has been hard at work trying to shape the message and public opinion. Unsurprisingly, much of that message is less than 100 percent accurate. Here are some myths about the debt ceiling and the upcoming debate about raising it:

1. Failure to pass means defaulting on our debts. If there has been consistent message from the White House, it that the United States can’t afford to “default on our debts.” That is almost certainly true. However, refusing to raise the debt limit does not mean defaulting on our debts. The U.S. Treasury currently takes in more than enough revenue to pay both the interest and the principal on the debts we currently owe. And if the Obama administration is truly worried about whether it will do so, then it should urge Congress to pass the legislation proposed by Sen. Pat Toomey (R., Pa.) requiring the Treasury Department to pay those bills first. It is true that, once we had paid our debt-service bills, there wouldn’t be enough money left over to pay for everything else the Obama administration wants to spend money on. The government would have to prioritize its expenditures — sending out checks for the troops’ pay and Social Security first. Other spending would have to wait. Treasury Secretary Tim Geithner says that not spending money Congress has appropriated is “the same as default.” It is not. It is economizing, which is what you do when you are out of money.

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This video below accurately shows how I think the Democrats are acting concerning the debt ceiling:

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I have written about the debt ceiling many times and here are some of the past posts: