The “negotiations” between the Democrats and Republicans on raising the debt limit continues, with appropriate declamations about the intransigency of the others at the table. This is a predicted Kabuki dance wherein each party is in the process of proving to its respective bases that they are really, really tough and are going to get the best possible deal from the other.
The trouble is, if they aren’t careful, they will go over the cliff by accident, the cost of government borrowing will explode, and the interest on the debt will swallow the government.
If the Republicans think that they can push the country into default and blame the Democrats, they are even more idiotic than they pretend to be. It is an obvious fact that the Democrats have offered substantial cuts in government spending, and the Republicans have offered zero revenue increases. The ones who are refusing to negotiate are the Republicans, and they will be blamed for the consequences of not allowing an automatic raising of the debt ceiling.
The Tea Party sent anti-tax extremists into the government to insist on reducing the size of government, and those true believers are doing what they believe in. But, the country is not becoming a Tea Party nation, and if the Republican leaders allow actual default, they will be complicit with the death of the Republican Party.
Meanwhile, where are Obama and the Democrats on the necessary proposal for tax reform that will create revenue increases while lowering tax rates and thus bringing in both needed government income and allowing the market and the lagging recovery to breathe? Are they playing their own political high-risk stratagem of allowing the Republican Party to destroy itself while they pretend to be innocent bystanders?
Playing politics can be dangerous - to the health of the nation, and to the survival of political parties.
