I’d much prefer a political discourse in which policymakers simply evaluated a measure on the merits and voted accordingly. But since that’s fallen out of fashion in Washington, we’re left to emphasize observations like these.
Several prominent congressional Republicans have dismissed the Obama administration’s claim that the country would face dire consequences if Congress does not vote to raise the federal limit on government borrowing by August.
But an icon of the Republican Party – former president Ronald Reagan – warned Congress during his presidency that a failure to raise the debt limit could also cause a financial catastrophe.
In a November 1983 letter to then-Senate Majority Leader Howard H. Baker Jr. (R-Tenn.), Reagan warned that without a higher debt ceiling, the country could be forced to default for the first time in its history.
Reagan wrote: “The full consequences of a default — or even the serious prospect of default — by the United States are impossible to predict and awesome to contemplate. Denigration of the full faith and credit of the United States would have substantial effects on the domestic financial markets and the value of the dollar.”
This really shouldn’t matter. Republicans should simply realize that raising the debt ceiling is the sane thing to do and act accordingly.
But we’re currently left looking for a way to help GOP officials understand the seriousness of the situation, and given Republicans’ religious reverence for “Ronaldus Magnus,” maybe this will help.
As Pat Garofalo noted this is especially important for GOP lawmakers who have convinced themselves that this issue is fairly trivial, and concepts like “default” and “full faith and credit” are minor inconveniences better left ignored.
If they’re not willing to listen to economists, American business leaders, the financial industry, the Federal Reserve, and the Treasury Department, maybe they’ll listen to Reagan, who decried policymakers who would “bring the government to the edge of default before facing [their] responsibility. This brinksmanship threatens the holders of government bonds and those who rely on Social Security and veterans benefits. Interest rates would skyrocket, instability would occur in financial markets, and the Federal deficit would soar.”