Press TV: If we look at this in context of tough economic times, can it be argued these negative sentiments are natural in such trying times?
Tarpley: Well, the negativity is fully justified. We are in a world economic depression as in the 1930s, it comes in waves. We had the first wave in 2008 were the bankruptcy of Bear Stearns [Companies], Lehman Brothers [Holdings] and really all of Wall Street. We are no going through the second wave of the depression, on the one side, the European debt and banking crises, or the euro crises, but that is now joined by these really unnecessary crises around the dollar and the US public debt. We have a mass of fanatics inside the Republican Party; this is known as Tea Party [movement]. These are reactionaries. They are founded by extreme right-wing business men, like the Koch brothers [of Koch Industries], they want the United States to go bankrupt, they want the US to default because they figured that if the United States can no longer borrow, they would be able to destroy the social safety net that we have had left over from the new deal, that is to say Medicare, Medicaid, social security and so forth.
Since they can't get that done by legal means, they are trying to go outside of the government and the constitution to force the bankruptcy of the country, thinking that in that case there won't be any money for these programs.
Unfortunately, Obama has not put up a good front against them; he has gratuitously said that he wants to sacrifice parts of Medicare, Medicaid, and social security. That was the surprised announcement that he made at the middle of last week.
Right now though Wall Street is making its voice heard. If the Unites States defaults all central bank reserves in the world will be radically devalued, there will be a world panic, a catastrophe.
Press TV: Some economists say that neither party would let the US default, and that they are simply playing politics. Do you agree?
Tarpley: Normally that would be true, but we know have a group of true ideological fanatics, the Tea Party. They believe in the Austrian school, and the Chicago school. They believe they you can have market without a government. They are neo-feudalist, right-wing anarchist - whatever you want- they believe that.
Now, the leaders of the Republican Party are getting calls from Wall Street right now saying that either you raise the debt ceiling, and preserve some kind of stability, or you are maybe sleeping with the fishes or a cement overcoat, that's the level that it has come to. The problem is that there are 70 or 80 or 90 Republicans in the house who are impervious to all kind of reason discourse. They are getting threats, they may come around as a result of the threats, but the situation is now on the brink, it would never be this way if you never had these fanatics who are essentially beyond all reason.
“The nation can meet its obligations without taking action to increase debt, the Minnesota Republican insisted, despite warnings from Treasury Secretary Timothy Geithner, who has said lawmakers must reach a deal on increasing the debt limit by July 22 and raise the debt ceiling by August 2.”
“The reason is simple: A government default would destroy the credit system as we know it. The fundamental benchmark interest rates in modern financial markets are the so-called risk-free rates on government bonds. Removing this pillar of the system—or creating a high degree of risk around U.S. Treasurys—would disrupt many private contracts and all kinds of transactions. In addition, many people and firms hold their rainy day money in the form of U.S. Treasurys. The money-market funds that are perceived to be the safest, for example, are those that hold only U.S. government debt. If the U.S. government defaults, all of them will "break the buck," meaning they will be unable to maintain the principal value of the money that has been placed with them.”
Originally posted by civilchallenger
reply to post by inforeal
The point of the Tea Party is to reduce government spending. Therefore the title of this posting suggests that a reduction of government spending would "Drive the US towards catastrophic default". Its such a laughable joke. No, the tea party people have a little thing called common sense. Common sense is that the US is on a path to catastrophic default right now and that because of that, we have to stop raising the debt limit.
The blaming of the Tea Party on this is simple proof that people are complete idiots and Democracy is failing because complete idiots with zero understanding of reality are in charge. The collective of intelligence in the US is supposed to be something bordering at least mild intelligence but it obviously isn't.
Simple common sense is gone entirely. Common sense being that if you're heading towards bankruptcy borrowing even more money isn't going to help you out. I mean I have to say that? LOL
Iceland is all but officially bankrupt
Thursday, October 9, 2008
REYKJAVIK — People go bankrupt all the time. Companies do, too. But countries?
Iceland was on the verge of doing exactly that on Thursday as the government shut down the stock market and seized control of its last major independent bank. That brought trading in the country's currency to a halt, with foreign banks no longer willing to take Icelandic krona, even at fire-sale rates.
As the meltdown in the Icelandic financial system quickened, with the government seemingly powerless to do anything about it, analysts said there was probably only one realistic option left: for Iceland to be bailed out by the International Monetary Fund.
"Iceland is bankrupt," said Arsaell Valfells, a professor at the University of Iceland. "The Icelandic krona is history. The IMF has to come and rescue us."....
Iceland Bankruptcy-to-Rebound Reveals Models Ireland Won't Take
By Kati Pohjanpalo and Omar R. Valdimarsson - Dec 2, 2010 10:59 AM ET
Iceland is betting its decision two years ago to force bondholders to pay for the banking system’s collapse may help it rebound faster than Ireland.
Iceland’s taxpayers face a smaller debt burden than their Irish counterparts, where the government’s guarantee of the financial system in 2008 backfired this year when the banks came close to insolvency. Iceland’s budget deficit will be 6.3 percent of gross domestic product this year and will vanish by 2012, compared with the 32 percent shortfall in Ireland, the European Commission estimates.
While analysts expect Iceland’s recession to extend into next year, the nation’s exporters are benefiting from a 28 percent drop in the krona against the dollar since September 2008. The decline may help the nation of 320,000 people rebalance its economy faster than Ireland, whose euro membership rules out a currency devaluation. With Iceland’s OMX share index up 17 percent this year, the third-biggest gain in Europe after Denmark and Sweden, Nobel Prize-winning economist Paul Krugman says Iceland may be an example of “bankrupting yourself to recovery.”
“The difference is that in Iceland we allowed the banks to fail,” Iceland President Olafur R. Grimsson said in a Nov. 26 interview with Bloomberg Television’s Mark Barton. “These were private banks and we didn’t pump money into them in order to keep them going; the state did not shoulder the responsibility of the failed private banks.”
Originally posted by inforeal
None of the posts above understand that the Tea Party is a corporate shill; it is not even a legitimate movement. You should try reading what Tarpley says about who invented them—right-wing PTB.
Also, they are threatening to bring down the economic system because of their adherence to no taxes for the rich, they don’t really care about the deficit. If they had they would have made a deal with Obama.
The only good that can come from a default is that people finally will see the Tea party and their Republican conservative matrix for what they truly are.
.....People don’t realize the utter recklessness and ignorance of this creature called the Tea Party . . . who are in the process of blackmailing the weak willed president Barack Obama over the debt limit......
So it seems that the Tea party, another sinister creation from the PTB...
In 1976 A typical American CEO earned 36 times as much as the average worker. By 2008 the average CEO pay increased to 369 times that of the average worker. timelines.ws...
Barack Obama has reshuffled his staff, bringing in a trio of free trade advocates...
And to top it off, General Electric CEO Jeffery Immelt was tapped to lead a newly created Council on Jobs and Competitiveness....
Immelt, who will now have the president’s ear in an advisory role, has consistently supported the same failed trade policies that have cost America millions of jobs. As the leader of one of the world’s largest companies, he has been at the forefront of the outsourcing movement.
“You would have difficulty finding a company that has outsourced more jobs and closed more American factories than GE,” Scott Paul, Executive Director of the Alliance for American Manufacturing writes. “While they have slashed their American workforce to fewer than 150,000, GE has dramatically expanded its global presence, now employing over 300,000 workers worldwide.”
In the past, Immelt was a vocal supporter for China’s entry into the World Trade Organization. He also spoke out against the proposed “buy American” provision.
Immelt, Daley and Sperling certainly do not represent the “change” the president was fond of referring to in 2008. In fact, all three represent more of the same - failed trade policies that result in the loss of millions of jobs.
"These are reactionaries. They are founded by extreme right-wing business men, like the Koch brothers [of Koch Industries], they want the United States to go bankrupt, they want the US to default because they figured that if the United States can no longer borrow, they would be able to destroy the social safety net that we have had left over from the new deal, that is to say Medicare, Medicaid, social security and so forth. "
As far as I'm concerned, the economics knowledge of the Tea Party is unsurpassed in terms of collective economics intelligence. So no, I don't blame them for any negative US economic issues up to and including a debt default.
Her analysis of poll results shows that while Tea Party members are politically sophisticated and vote at high rates, they are also fiscally and socially more conservative than other Republicans...