With Fedstock now past, we turn our attention to the next cataclysmic event that will either blow up the world or kill all our first-born or something like that – the debt ceiling debate and the credit worthiness of our sovereign debt.
Just to catch you up, there really isn’t any choice but for congress to approve the higher debt ceiling but the GOP is making a great big show out opposing it to appeal to their base and the Tea Party fringe.
Colin Barr takes the Boehner-is-a-Lunatic approach in his piece today at Fortune. And he’s got former Treasury Secretary Paul O’Neill on his side:
…maybe we have years, rather than weeks, before the lunatics in Washington finally blow us all sky high. But Paul O’Neill, the former Bush administration Treasury secretary who run out on a rail after failing to quaff the tax-cut Kool Aid, said Wednesday that he isn’t at all sure the United States will avoid a collision with bond market reality this summer.
Republicans who insist on linking a rise in the federal debt ceiling to immediate budget cuts “are our version of Al-Qaeda terrorists,” O’Neill said on Bloomberg television. “They’re really putting our whole society at risk by threatening to round up 50% of the members of the Congress, who are loony, who would put our credit at risk.”
I cann tell you guys right now that as earnings season fades and we all get over the whole Hawaiian birth certificate thing, this debt ceiling debate is going to be all you hear about.