There's so much opposition to Speaker Boehner's plan that he delayed the vote until tomorrow so he can rework his bill. The Dems don't want to have to revisit this in 6 months, and the GOP don't think he cut enough spending. Indeed, the bipartisan Congressional Budget Office said that his $1.2 trillion is really $900,000, so the right wing of the GOP is not satisfied. And the White House has threatened to veto it because it doesn't want a short-term solution that puts us right back where we started. But that's the biggest difference between the GOP and the Dem plans -- the GOP would be short-term and the Dems would carry us into 2013. Other than that, the parties are close to a deal on spending cuts, although, of course, spending cuts don't affect the debt ceiling -- the debt ceiling is only about paying debt we've already incurred. 70 million checks a month are written by the federal government. Who can we afford not to pay? Both President Obama and Speaker Boehner say they are fighting for the middle class. Really?
Are these guys really going to bring us to default and disaster? I saw a commercial last night in which Michelle Bachman swears she'll never vote to raise the debt ceiling. It's good to have principles, but not when they cause major worldwide economic panic. Everybody else -- banks, business, families -- are really worried about the consequences of a default. The Chamber of Commerce is pushing the GOP to make a deal. There may be some money for about a week after August 2, but once our credit rating is down-graded, borrowing will cost us a lot more. Here's an explanation of how a US downgrade will affect consumers. The Federal Reserve says it can't solve this problem.
And most important of all, the GOP has been all over President Obama for not supporting "American exceptionalism." But if we are a deadbeat country that doesn't pay its debt, that severely harms our international standing. The Capitol switchboard is overwhelmed by the phone calls coming in. The majority of Americans agree that there should be a mix of spending cuts and revenue raisers to solve the debt. Religious groups urge protecting the poor. But even more than default, what will hurt us is an increase in interest rates, making borrowing more expensive and increasing the US debt. It also would hurt consumer debt, and it may happen now even if we come to an agreement, having looked so shaky in front of the rest of the world.
In other news, AARP backs a medical loss ratio (amount of premium dollars spent on health care) for Medigap plans.
Is Medicare ripe for a change as it hits 46 years? Read what the experts have to say.
And that's it for this morning. It's all about the debt ceiling from now until August 2 -- and, sadly, probably beyond. Jennifer