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There have been a lot of articles suggesting that the best outcome is to just default, have Obama save the day and dare the Republicans to do anything about whatever remedy he chooses.

I think this is a moderately likely future at the moment, but I do not think it is the best future.   The primary problem is that this overlooks the fact that our government is shut down, but has not yet reached the end of this month when 800,000 federal paychecks fail to arrive and all the states run out of whatever money they've been spending to limit the damage.   Our economy has taken a hit, but the situation is like a person wounded and bleeding, but not yet gone into shock or critical blood loss.

While we may all be mad that at the people who injured the person, wanting us to go into default so we can extract the maximum political benefit is like hoping a shot hostage will die so we can charge murder instead of assault.

There is another possible future.   Something like the current Senate bill is passed before Thursday and both the debt ceiling threat is averted and the government opens before the damage is too bad.   No constitutional crisis.  3 months of budget negotiations we wanted anyway for the prior 6 months.   Republican shutdown in the news for those entire 3 months as we get closer to 2014 elections.   The patient has been given first aid and will probably be ok unless shot again.

I can live with that future even if it means we lose a lot of our political advantage, as long as the final deal doesn't encourage future hostage taking.  This is true even if all it does is not encourage it MORE than the incentives on Sep 30.

Follow me below the fold if you still think letting the hostage die is the better solution in the long term.  You may be right, but I do have another argument why it is unusually risky at the moment to go down this road.

The problem with the scenario where Congress fails and the President has to stop the country from defaulting is not just the economic shock and long term governmental costs caused by increased interest rates and market reaction to whatever uncertainty the new remedy for debt limit might be until it has clearly survived all constitutional challenges.

The problem is we will be in a period where our government is shut down, providing few or no services AND we're using a constitutionally untested means of paying our bills.

The government shut down means our government is paralyzed.  The impact of the shutdown and the debt limit constitutional crisis also means we're going to get an economic shock.

Severe economic shocks caused by governmental dysfunction don't just lead to misery.  Historically the most common outcome is either revolution, civil war or martial law and state of emergency, which can extend for decades if convenient to the powers that be.

Furthermore even if those dire outcomes do not occur, constitutional crises (or the equivalents in monarchies) quite often have many unintended consequences down the road that lead to one of the above horrible outcomes.

Lest you think I am being histrionic, I will cite some cases from history.  This is only a small sampling.

In Republican Rome, the Brothers Gracci discovered that the Tribune of the Plebs could prevent the Senate and the two Consuls from doing anything if they wielded their veto aggressively.  Only custom had prevented this in the past.   Government gridlocked while they demanded many things we'd call Populist today.  The solution was to kill them by assassination.   This introduction of extralegal violence into Republican government is now thought to have made the later proscriptions of Sulla more acceptable, and the logic leads directly to the assassination of Julius Caesar.  For more unexpected consequences...J. Caesar was killed because he used unconventional means to be declared Consul for Life, and was killed to prevent him from becoming what his adopted son Augustus eventually became....and the people of Rome allowed it because the Republic's slide into dysfunction had lead to not one but several civil wars, and Augustus put an end to it and presided over a long peaceful period.

In 1640s England, Parliament got so fed up with the King they executed him.  That set off a 10 year civil war until Parliament got full control of the country.  After Cromwell died, the Parliament became unpopular enough that a King was invited back in, although with more checks on his power.

In 1790s France, there was a severe economic crisis.  For the first time in ages the King summoned the Estates General to deal with it.  They behaved about as well as our Congress right now, and the result of the Estates+King failing to actually fix problems and being seen as incapable of doing so lead to all of them going up on the block, literally, a decade of Revolution and the Terror, followed by another decade of Napoleonic wars.

In 1849, there was a European Spring of sorts, quite a bit like the Arab Spring, modeled on the French Revolution.  Monarchies having learned from France's example, it was bloodily crushed (see Martial Law and State of Emergency).   Long term there were some positive results...Serfdom was eliminated from a  number of countries and some monarchies got constitutional checks on powers instead of being absolute.  Not much comfort to those who lived through it though.

In the 1850s, the American Whig party split over slavery, and the radical rump faction (perceived much as the Tea Party is today) managed to win the equivalent of the 2012 election and put someone perceived by the South about as Michelle Bachman is perceived by us as president, with control of both houses of Congress.    The South didn't respond well, and we're still in some ways fighting the unintended consequences of the constitutional crisis they caused when they didn't accept the results of the election.   That situation didn't have an economic crisis, unlike most of the others.

In 1917 Russia, a population tired of wars and severe economic hardship shot their entire government and tried to form a democracy.  Unfortunately the new government still wanted to fight the war.  The second revolution resulted in the USSR.

In early 1930s, the Weimar republic had been made ungovernable during a severe economic downturn by the simple expedient of a determined minority party blocking all votes and forcing repeated elections (parliamentary systems are like this.   They can't have a govt shutdown, but repeated no confidence votes amount to something very similar).   Finally the corporate powers and some government officials decided the way to stop the obstruction was to make the person who was perceived about how we see Paul Ryan the powers of the Speaker in a system with no Senate to check it.   They thought they could control him, they were wrong.  One ginned up crisis later, emergency powers acts emasculated the executive and prevented new elections until the Nazi party decided they wanted to hold them.   Everybody knows what happened next.

In the late 1970s, absent an economic downturn or similar cause, but with a legitimate complaint that the current govt was a foreign puppet, secular and religious activists paralyzed the government of Iran primarily through nonviolent protests and strikes.  When the Shah was out of the country, a little short, sharp fighting toppled his government and replaced it with an ostensibly democratic government, although all of its institutions were subject to review by the clergy.  In less than a decade, the secular leaders who supported the revolution were purged and the first significant act of the new government was to get into an extremely bloody and costly war with Iraq.

The common thread in most of these is a government made dysfunctional at a time when the citizens needed it to act (usually economic hardship).    I think it is extremely dangerous to have a nuclear superpower in a situation where it has BOTH a constitutional crisis AND a paralyzed government, especially as it would then be about to experience an economic shock of a severity that nobody can even predict but even if it is ONLY a government shutdown during the Christmas season, will at minimum be a severe recession and might spiral into 2008 territory.  Or even worse.

If we're going to have an economic shock, I want a government up and running.  If we're going to experiment with constitutional crises, I want the economy to at least be limping along without any extraneous shocks.   Doing both at once is freaking dangerous.

So for me, while I'm pretty hopeful that the Prez will step in to avoid default and that the Rs will be very severely damaged if that scenario occurs, I prefer the future where some kind of deal is made that doesn't reward hostage taking even if it means the Rs get off the hook and the next few years look a lot like the last couple of years.

I really don't want to live in "interesting times".   The Chinese sure have that right.  The place for "interesting times" is when all alternatives are worse, or preferably safely in a history book or even better..fiction.

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Comment Preferences

  •  After Thursday all bets are off (7+ / 0-)

    We'll be in uncharted waters.

    Obama can rise to the occasion but his effectiveness will be hampered by a suicidal Tea Party/GOP.

    These wingnuts actually want the ensuing chaos.

    We are 24 hours away from a complete debacle.

    Your historical analogies are useful but don't give me much hope.

    I'm buying gold coins and stockpiling food and water.

    Daily Kos an oasis of truth. Truth that leads to action.

    by Shockwave on Tue Oct 15, 2013 at 06:06:54 PM PDT

    •  They're not intended to give hope (5+ / 0-)

      They're intended to remind people that the usual result of going into uncharted waters with an economic shock is bad.

      Skip the gold and invest in a disaster kit.  It's always good to have an emergency set of stuff to grab and go if a natural disaster hits and it'll work equally well for other kinds of disasters.

      •  Here in Los Angeles we keep enough water for weeks (1+ / 0-)
        Recommended by:
        Bensdad

        And after an earthquake the first thing you do is to fill up the bathtub.

        Food for 1 month is what I need.

        The gold coins are good to travel.

        Let's hope the insanity ends tomorrow.

        Worst case scenario is a coup.

        Daily Kos an oasis of truth. Truth that leads to action.

        by Shockwave on Tue Oct 15, 2013 at 06:21:43 PM PDT

        [ Parent ]

    •  I'm not saying not to worry. There's plenty to (1+ / 0-)
      Recommended by:
      Shockwave

      worry about. However, we won't default until we do. The experts I've been listening to think we really run out of money sometime between the 23rd and the 31st. That doesn't mean the market won't go crazy. But it's not a default until we actually can't pay something.

      Are you at least stockpiling good food?

      •  Running out of money isn't default (7+ / 0-)

        The first bill we can't pay due to short term cash-flow issues is default.

        Ie, we need to pay a bill for 5 million and our balance is down to 3 million.  We have 20 million about to arrive in the coffers in 15 minutes, but our check bounces immediately.   Normally we're fine because Treasury just borrows enough on a very short term basis to cover it and our checks never bounce.   (all major banks use similar processes, although I'm forgetting the technical term for it.  Special rates only for banks and governments who deal with vast amounts of transactions exist)

        The first bill that fails to be paid will cause the shock.

  •  exactly what is it that you think (0+ / 0-)

    President Obama could step in and do to prevent this? Are you suggesting he capitulate to the hostage-takers? If not, exactly what is it that you would have President Obama do to stop this, other than what he's already done?

    •  Can't prevent Congress from failing to start the (4+ / 0-)
      Recommended by:
      tofumagoo, terabytes, machka, ExpatGirl

      government up.  Obama is helpless on that front.   Either congress starts govt up in a way that is acceptable to Obama (or can override the veto), or we stay shut down.  

      He can, however, prevent default because he's essentially facing a constitutional amendment and a law that conflict, and the amendment gives the executive the power to make sure debts are paid.

      Many approaches to this have been suggested, and Obama has up till now not endorsed any of them because doing so would enable default-deniers.  But the second a deal can't be reached in time and default's gonna happen an uncertain constitutional remedy is better than 100% chance of default.

      So he'll try something, which might be as simple as simply instructing Treasury to borrow money anyway, in defiance of the debt limit law.   (platinum coins and other options are possibly also on the table.  Only Obama knows for sure)

      The problem with that outcome, as stated in my diary, is the shutdown remains while an  untested remedy for default is tried.  That's a volatile mix and if economic shock for that event and/or an extended shutdown is severe enough, we're looking at a nontrivial chance of an existential threat to this country, based on history.  

      I don't care to risk my life or that of my fellow Americans on hoping it works out well instead.  So I'm rooting for the Senate to succeed and the House to let their deal come to a vote.  So far the Senate deal looks ok and likely to come together, but Ted Cruz or any other asshole can delay it 30 hours, into the default period, if they decide to do so.  

      Which leads to a third possibility.  The deal isn't in time but is clearly going to happen.   That's more like the brief shutdowns in the 80s and 70s, or the technical default we had in 1979.   I think the country would be in the 99% "it's going to be ok" category in that scenario but it's worse than if the deal gets done in time...there will be some economic consequences and Obama will be in a real bind if he has to reveal his "stop the default" card when it'll be moot in a few hours.

  •  Just a note of correction (5+ / 0-)

    Based on the latest numbers I have seen, there are about 350,000 federal employees still furloughed (including me and my husband).  However there are many hundreds of thousands of federal workers (including those furloughed and many of those who are required to work during the shutdown) who are not getting paid while the government is shut down.  There are several estimates that a similar number of government contractors are currently or will soon be furloughed as well.

    •  The 800k number is based (1+ / 0-)
      Recommended by:
      bluinsc

      on the estimated missing paychecks, not who is actually at work right now.  I didn't vet that figure, it's one I've seen in the news back when the shutdown started.

      •  No worries - just trying (1+ / 0-)
        Recommended by:
        ExpatGirl

        to get the word out that missing paychecks are an issue across working and non-working Feds as well as many in the private sector.

        I've been pissed at how much the GOP and their lapdog press has succeeded in trivializing the effects of the shutdown so I appreciate you making the point!

  •  Good points to think about...no easy way out (0+ / 0-)

    because Obama has been placed between a rock and hard place.

    He's clearly outlined his preferences, his vision for the country, and his personal limits.

    I trust the country is in the best of hands under the circumstances.

  •  the tp-ers are going to introduce articles of (4+ / 0-)
    Recommended by:
    terabytes, Zinman, Shippo1776, JerryNA

    impeachment against the prez no matter what he does -- sarah palin's already said as much (for what it's worth -- which is, of course, zero). she said if the prez lets the country go into default, that's an impeachable offense, & if he tries to do anything to prevent it, that's also impeachable -- so, the tp-ers are setting up a catch-22 situation where the prez is damned if he does, & damned if he doesn't.

    remember what their goal is in all this: to get rid of obama anyway they can, & the more painful & humiliating it is, the better. they're a bunch of sick fuckers.

  •  Whatever one's opinion is, your diary is a must (5+ / 0-)

    read. Thank you.

    The fly in the ointment is that your hoped for solution still assumes all the parties don't want to see the destruction of the government as it exists today. I am not convinced this is the case. I genuinely believe Cruz was quite literally bred for this:

    His dad is a revolutionary, having fought with Castro. He is also an ardent Dominionist, whose other life's mission has been to install biblical-based government. Let that sink in and consider it. It means Ted Cruz likely grew up with romanticized stories about revolution, then had those stories honed towards the Dominionist mission.

    Cruz wants it all to burn, and he fully expects to rise as the new leader of his "Christian nation."

    I distrust those people who know so well what God wants them to do, because I notice it always coincides with their own desires. - Susan B. Anthony

    by pajoly on Tue Oct 15, 2013 at 07:40:18 PM PDT

    •  Cruz can only delay it for 30 hours (1+ / 0-)
      Recommended by:
      kyril

      If Reed can muster 60 votes.

      Not the ideal outcome, but pretty close to the better scenario.

      •  Reid can nuke the 60 vote thing, and should (3+ / 0-)
        Recommended by:
        greblos, kyril, JerryNA

        If there were ever a time to use all those mega-tons of dry powder he has been saving, now is time. So, end the filibuster rule now, and get on with doing what we have to do.

        I think Reid should call for the President to mint a 10 trillion dollar platinum coin, and use it to make the government solvent. The legal issues of the platinum coin are sound, and the impending disaster is just the time to use it. I do not doubt that the bonkers baggers in the House will impeach the President, but so what? The Senate will toss out the impeachment immediately. End of crisis. Baggers then have a snit fit and leave for Somalia. Good luck with that.

        Carbon dioxide in the atmosphere is now 400ppm. That is "Climate Cluster Chaos". (hat tip to JeffW for CCC)

        by Zinman on Tue Oct 15, 2013 at 08:46:40 PM PDT

        [ Parent ]

        •  Ending the filibuster (2+ / 0-)
          Recommended by:
          Zinman, kyril

          Is a potential option if the Prez tells Reid "please don't put us in default for 6 hours.  All of my options will be terrible then".  

          I'm not sure he's got the votes even now.  He still needs 50 dems+Biden using the nuclear option.   If he's got the votes, a quiet threat of that might be what causes Cruz to NOT filibuster.

          I guess we'll see tomorrow.  shudder

          •  I hope the Prez already has the coin in hand (0+ / 0-)

            I just hope he's not flipping it to see what to do.

            Perhaps he has reflected on what Lincoln would do, scholar of Lincoln that he is, and has already steeled himself for the coming battle, marshalled his resources, and set up the battlefield for the destruction of the baggers and the Kochs' treasonous attacks on our Democracy.

            Carbon dioxide in the atmosphere is now 400ppm. That is "Climate Cluster Chaos". (hat tip to JeffW for CCC)

            by Zinman on Tue Oct 15, 2013 at 09:18:53 PM PDT

            [ Parent ]

        •  Upon reflection (1+ / 0-)
          Recommended by:
          Zinman

          He could move to make raising debt limit something that can't be filibustered.  That'd likely get at least 50 votes.

  •  T&R'd, conditionally on so many things, but (1+ / 0-)
    Recommended by:
    ExpatGirl

    first and foremost, I need to think a lot more about what you've posted. Thanks, in either case.

  •  For all we know, the TPers are bucking for a (2+ / 0-)
    Recommended by:
    blueoasis, JerryNA

    trifecta, kill this bill so CR and default are still live, and while that is going on, bring a bill of impeachment for Obama not having done some thing to stop it all - IF Gohmert knows a theory that that would do the job, it has been discussed somewhere where he heard it to report it. He's too dumb to think it up himself.

    My own personal guess is that Reid and McC have worked out where the votes will come from if a sixty vote vote is needed, since it will be both of their deals that they are protecting. and every one of the six or so needed would be in a swing state where getting a resolution through in the teeth of teabaggers would make the six look like heroes. Herrera is already lined up to volunteer for that, publicly.

  •  I am SO GLAD you posted this! (0+ / 0-)

    It needs to be in the Community Spotlight.

    I am so deeply concerned about the fact that people in America, by and large, really don't seem to grasp the chaos behind the door. If it is opened, the talk about 'oh, we will take care of this during the next election' is pointless.

    And we aren't just talking about chaos here. It will be global.

    Further to everything you have said, a poster yesterday brought up the NSA. Imagine the possible scenarios of having a major nuclear power in chaos AND sitting on such global information.

    Americans are so used to sitting at the top of the food chain but it is a big world out there and people in other countries care just as much about their own security.

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