This has to be one of the more brazen displays of lunacy yet from Josh Mandel’s non-campaign for senate. In a letter of endorsement from fellow wacko Sen. Jim DeMint, Mandel went on the record supporting the move to not raise the nation’s debt limit. This is from the letter of endorsement from the Senate Conservative Fund, a PAC run my Senator DeMint to help raise money for people who are clearly too out-of-touch to find a job elsewhere.

  • Brown SUPPORTS raising the debt limit. Mandel opposes it.

On issue after issue, the choice is clear. Josh Mandel fights for freedom while Sherrod Brown fights for dependency.

If by forcing the US into an unnecessary default and destroying the credit worthiness of this country to score political points is some sort of necessary freedom, than I don’t want to have anything to do with that freedom.

Here is the problem, as I’m sure you are all tired of hearing by now, we have T-minus 12 days till the US will be unable to issue and sell any more bonds to pay for our outstanding obligations. These obligations are made up of medicare payments, social security payments, interest on debt, salaries to lunatics in the Senate like Jim DeMint, etc. Not paying any of these obligations will cause the county to default on its loans. (Also, don’t let anyone tell you that the US government can pay the interest on the debt we owe, and nothing else, and that will prevent the government from defaulting. Imagine you had three loans and at the end of the month you had enough money to pay on two of them. If you pay on two of them, and not the third, you have still defaulted on your third loan – this argument clearly doesn’t make any sense.)

Now, since the US defaulting has never happened before it is hard to say what impact this will have on the nation’s economy. Most economists agree that the spectrum of outcomes ranges from crappy to super crappy. Not raising the debt ceiling will be the first time a nation in modern history will have defaulted on its obligations not because it ran out of money, but because it simply decided to stop paying them back. A dubious distinction to say the least.

Besides the tremendous impact defaulting will have on markets around the world, and the economy here at home, millions of Ohioans who rely on medicare and social security will see their payments vanish. I’m going to turn this over to Justin Barasky, Spokesperson for the Ohio Democratic Party:

“Josh Mandel’s decision to support the United States going into default shows a startling disinterest in the repercussions for millions of Ohio seniors who will be left to twist in the wind if Medicare and Social Security benefits are delayed because of default,” said Ohio Democratic Party Press Secretary Justin Barasky. “It’s one thing not to care about the job you promised voters you would fulfill, it’s another not to care about how those very people are going to pay their bills, buy food, and pay for healthcare.”

Real. Talk.

In review, not only does Josh Mandel support pushing the economy into another recession but he also thinks it is OK for seniors and retirees to nott receive the money they need to buy food, pay rent, and pay for medical care.

Josh, may I suggest you try actually being the State Treasurer for awhile before you start espousing on economic policy again. You might learn a thing or two.

  • Anonymous

    ” Not raising the debt ceiling will be the first time a nation in modern
    history will have defaulted on its obligations not because it ran out of
    money, but because it simply decided to stop paying them back.”

    Hey, Einstein. The USGov HAS run out of money, so they need to borrow more in order to, well, pay back the money they already borrowed. That’s why they need to raise their borrowing limit. Not exactly rocket science, but obviously a point you fail to grasp.

    Oh, and if Social Security (and Medicare for that matter) are such great self-funding programs, why the hell wouldn’t grandma get her SS check if the debt ceiling is reached. I’ll leave you to think about that yourself?

    People like you are just great. “Hey! Let’s borrow our way to a better credit rating!”

  • Anonymous

    First off, my apologies for getting all snarky. Your reply was very gentlemanly. Kudos.

    Looking at this rationally, wouldn’t it be more honest to just get the default out of the way, especially considering that default is inevitable? Wouldn’t you rather see the drunk on the barstool quit drinking and admit he won’t be able to pay you back, or have him stay liquored up and keep coming back for more beer money?

    Also, consider this – the people who lend money to the USGov do so voluntarily. But the debts incurred by the government are an involuntary burden to generations of Americans YET UNBORN, as well as those who are just children and young people today. When did it become acceptable to indenture other people without their consent? How is it morally acceptable to saddle them with the debts of past generations? The only moral solution to this issue is to repudiate the national debt.

    If people really were to think and behave like adults, they would realize that the end of the “free lunch” is very near. The USGov can either default in an orderly fashion, or the international bond markets will impose a very messy default and give those who might help ease the situation little to say in the matter.

    Regardless, whatever happens, the USGov is going to eventually go into default. The point of no return has been passed.

  • I say we build a few more weapons systems on the way down.  What do you think?

  • Ben

    There is no reason to believe that “the point of no return has been passed” The US ran deficits that were much higher, as a percentage of GDP, during the last century but we had surpluses going into this century. Turning this around is matter of political will.

    Also, the argument that the bond vigilantes who are out there and will someday punish the US because of our borrowing rings hallow to me. Interest rates are at near zero and when ever there is news of some other country having trouble, investors run to US treasuries because the markets believe it is the safest place to be. If the markets thought there was a problem we would have seen. And purposely defaulting seems like a irresponsible action to prevent a hypothetical problem there is no evidence for. 

  • Spot on.  “just get the default out of the way” is one of the dumbest things I’ve read relative to the debt ceiling…and I’ve been doing a great deal of reading. 

  • Anonymous

    You know what? If you just GIVE all your money away and refuse to raise more, then of COURSE you will go into default. It’s reckless and irresponsible, and it’s what the Bush administration — a group of conspicuous NON-adults — did. The only moral situation is to get honest about what the cost of maintaining a civilized, modern nation is and stop being so damned cheap and selfish about paying it. if people were to really think and behave like adults, they would realize that the end of the “free lunch” for a tiny group of the country’s wealthiest people who have benefited the most from taxpayer funded services is over.  They would realize that those people have to pay their fair share and if they don’t, yeah, we can default, but this country’s years as a major political and economic world power are done, slaughtered at the hands of a greedy few.

    And “indenturing” people yet unborn? You mean that all our decisions should be based on the unknowable needs of people who might be born in the future? In addition, defaulting virtually destroys the future for all Americans – now and generations unborn. Our needs – and the needs of future generations are clear: we need to be willing to pay to maintain this country’s greatness. People like you who are not — who think individual greed takes precedence over a strong economy for all — need to admit that this country’s future doesn’t matter to you. A default is like a massive bankruptcy and it’s one this country will be paying for for centuries – if we last that long. This is the most reckless thing I’ve heard proposed in a long time.

  • Anonymous

    We are close to default because we spend all of our money on a security system and guns (& permits) to protect our family, our home, and our freedom.  We’ve had to spend our retirement funds, eliminate the kids’ allowances, and make cuts to our health care coverage.  But I’ve gotta tell you, never once did we think about reducing the amount we spend on defending our property.  In fact, we’re probably going to find more cuts so we can hire a security guard.

  • Anonymous

    The difference between the last century (and I assume you’re talking about the post-WWII period), and this is a biggie, is the USGov is more dependant on foreigners for funding. Eventually the China’s, Japan’s, and even the PIMCO’s of the world will demand much higher interest rates in return for lending to a bunch of spendthrift politicians who long-term outlook extends only to the next election. The political will you speak of simply does not exist in sufficient quantity to change the current path. And let’s not forget about the debasement of the dollar that is taking place. And you’re right, interest rates are at historic lows. They have nowhere to go but up. Each 1% increase in interest rates on the debt leads to an additional $140 billion in interest expense.

    The US dollar might occassionally be the turd at the top of the toilet bowl, but eventually all the turds get flushed, just like all fiat currencies eventually become worthless. Don’t be lulled into complacency because it hasn’t happened yet. There is nothing special about the US government that makes it impervious to the laws of economics.

    Believe what you want. Perhaps you’ll remember this exchange someday and think differently of my views.

  • Anonymous

    I’m curious. What are you reading?

  • Anonymous

    You could eliminate the entire DoD budget, double revenues, and it still won’t solve the problem. Between the debt and the unfunded liabilities of Social Security and Medicare, the USGov is looking at a bill somewhere north of $75 trillion.

  • Anonymous

    Bad pronoun choice by me.  I was referring to my personal budget at home.

  • Anonymous

    ***And “indenturing” people yet unborn? You mean that all our decisions should be based on the unknowable needs of people who might be born in the future?***

    No. I’m saying the USGov should quit borrowing money to benefit people who will be dead and gone when it’s time to pay the bill. It would be like if your grandparents were to leave you on the hook twenty years from now for a cruise they took today.

    And a default would NOT destroy the future. It would relieve future generations of the profligate self-indulgence their forebears.

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