Power Mad Obama Offers Two Choices: Unconditional Surrender Or Default

Jim SinclairBarack Obama is warning that if he does not get everything that he wants that he will force the U.S. government into a devastating debt default which will cripple the entire global economy.  In essence, Obama has become so power mad that he is actually willing to take the entire planet hostage in order to achieve his goals.  A lot of people are blaming the government shutdown on the Republicans, but they have already voted to fund the entire government except for Obamacare.  The U.S. Constitution requires that all spending bills originate in the House of Representatives, and the House did their duty by passing a spending bill.  If the Senate or the President do not like the bill that the House has passed, then negotiations need to take place.  That is how our system works.  And the weak-kneed Republicans have already indicated that they are willing to give up virtually all of their prior demands.  In fact, if Obama offered all of them 20 dollar gift certificates to Denny’s to end this crisis they would probably jump at that deal.  But that is not good enough for Obama.  He has made it clear that he will settle for nothing less than the complete and unconditional surrender of the Republican Party.
Why is Obama doing this?  Why is Obama willing to bring the country to the brink of financial disaster?

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It isn’t hard to figure out.  Just check out what one senior Obama administration official said last week

“We are winning…. It doesn’t really matter to us” how long the shutdown lasts “because what matters is the end result,” a senior Obama Administration official told the Wall Street Journal last week.

This is all about a political victory and crushing the Republicans.  Obama doesn’t really care how long this crisis lasts because he believes that he is getting the end result that he wants.

According to Obama, the Republican Party is just supposed to roll over and give him the exact spending bill that he wants and also give him another trillion dollar increase in the debt limit.

If the Republicans do not give him that, he is willing to plunge us into financial oblivion.

The funny thing is that most Americans do not want the debt limit increased.  According to one new poll, 58 percent of all Americans do not even want the debt ceiling to be increased by a single penny.

And recent polls show that Americans are against Obamacare by an average margin of about 10 percent.

But the pathetic Republican Party is actually willing to hand Obama a trillion dollar debt ceiling increase and fully fund Obamacare if Obama will at least give them something.

Unfortunately, Obama won’t even give them the time of day.

So don’t blame the Republicans for what is happening.  The Republicans have already compromised themselves to the point of utter disgrace.  If Obama had been willing to even compromise a couple of inches this entire crisis would already be over.

And nobody should be claiming that the Republicans won’t vote to end this shutdown.  They have already voted to end it.  The following is from a recent article by Thomas Sowell

There is really nothing complicated about the facts. The Republican-controlled House of Representatives voted all the money required to keep all government activities going — except for ObamaCare.

This is not a matter of opinion. You can check the Congressional Record.

As for the House of Representatives’ right to grant or withhold money, that is not a matter of opinion either. You can check the Constitution of the United States. All spending bills must originate in the House of Representatives, which means that Congressmen there have a right to decide whether or not they want to spend money on a particular government activity.

Whether ObamaCare is good, bad or indifferent is a matter of opinion. But it is a matter of fact that members of the House of Representatives have a right to make spending decisions based on their opinion.

Once again, the Republicans have already indicated that they are willing to fund Obamacare.  They just want Obama to throw them a bone.

And Obama will not do it.

So either the Republicans are going to cave in completely (a very real possibility) or we are going to pass the “debt ceiling deadline”.

What happens then?

Well, we would have more of a “real government shutdown” than the fake shutdown that we are having right now.

Once the federal government cannot borrow any more money, it will only be able to spend what it actually has on hand.  That means that a lot more government functions will have to shut down.

Money will still be coming in to the government, but it won’t be enough to fund everything.  According to the Wall Street Journal, the federal government will still have enough money to pay interest on the debt, make Social Security payments, make Medicare payments, make Medicaid payments, provide food stamp benefits and pay the military if they cut almost everything else out.

The other day, I suggested that the federal government could potentially start defaulting on interest payments on the debt as early as November.  But that would only happen if the federal government manages their money foolishly.

If the federal government managed their money smartly and saved cash for the interest payments as they came due, they would not have to miss any.

But when was the last time the federal government ever did anything “smartly”?

For the sake of argument, however, let’s assume that the federal government can manage money wisely and can save up enough cash ahead of time for large interest payments as they come due.

If that could somehow be managed, then according to Paul Mampilly the government would never need to actually default…

The U.S. Treasury always has money coming into its accounts. So its always got some amount of cash that it can use to pay interest on bonds. That’s especially true right now because the government is partially shutdown and there’s no cash going out from its accounts.

In fact, when you look at it the U.S. Treasury should simply have no trouble making interest payments on bonds that it has issued.

And there’s no restriction on the U.S. Treasury prioritizing interest payments. Why?

The obligation to pay interest is set by the 1917 Second Liberty Bond Act and laws that commanded the Treasury to pay interest on the debt. You can look this up in section 3123 of Title 31 of the U.S. Code and section 4 of the 14th Amendment of the Constitution and in Supreme Court precedent (Perry v. United States). It’s all there in black and white.

So the only possible way the U.S. defaults on its debt is if Barack Obama, President of the United States, instructs his Treasury secretary Jack Lew to default on the debt.

And according to the Washington Post, Moody’s has just issued a memo that also indicates that the federal government should be able to make all interest payments even if the debt limit is not increased…

In a memo being circulated on Capitol Hill Wednesday, Moody’s Investors Service offers “answers to frequently asked questions” about the government shutdown, now in its second week, and the federal debt limit. President Obama has said that, unless Congress acts to raise the $16.7 trillion limit by next Thursday, the nation will be at risk of default.

Not so, Moody’s says in the memo dated Oct. 7.

“We believe the government would continue to pay interest and principal on its debt even in the event that the debt limit is not raised, leaving its creditworthiness intact,” the memo says. “The debt limit restricts government expenditures to the amount of its incoming revenues; it does not prohibit the government from servicing its debt. There is no direct connection between the debt limit (actually the exhaustion of the Treasury’s extraordinary measures to raise funds) and a default.”

Of course the federal government would have to stop throwing money around like a drunk gambler at a casino in Las Vegas in order for this to work.

On the very first day of the government shutdown, the feds gave $445 million to the Corporation for Public Broadcasting.  Apparently Elmo is considered to be “essential personnel” by the Obama administration.

And according to CNS News, the U.S. Army has committed more than $47,000 to buy a mechanical bull during this “shutdown”…

The government shutdown may be keeping furloughed federal workers at home, but on Monday the U.S. Army contracted to buy a mechanical bull.

The $47,174 contract was awarded on Oct. 7 to Mechanical Bull Sales Inc. of State College, Penn.

So needless to say, there is some serious doubt about whether the federal government would be able to manage their money effectively in the event that the debt ceiling deadline passes.

And if the U.S. did start defaulting on debt payments, it would be absolutely disastrous for the global economy as I discussed in a previous article

“A U.S. debt default would cause stocks to crash, would cause bonds to crash, would cause interest rates to soar wildly out of control, would cause a massive credit crunch, and would cause a derivatives panic that would be absolutely unprecedented.  And that would just be for starters.”

Other nations that we depend upon to lend us money would stop lending to us and would start dumping U.S. debt instead.

Could you imagine what would happen if China started dumping a large portion of the 1.3 trillion dollars in U.S. debt that they are holding?

It would be a total nightmare.  The collapse of Lehman Brothers would pale in comparison.

And already some banks are stuffing their ATM machines with extra cash just in case the general public starts to panic.

But none of this has to happen.

If Obama decides to negotiate with the Republicans, this crisis will likely end very rapidly.

If not, and we pass the “debt ceiling deadline”, the federal government will still have enough money to make interest payments on the debt as long as they manage their money correctly.

Unfortunately, Obama seems far more interested in playing political games than he is in solving our problems.

In fact, Park Service rangers have been ordered to “make life as difficult for people as we can” during this government shutdown.  Obama has apparently decided to punish the American people in order to get leverage on the Republicans.  Just check out the following example from a new Weekly Standard article

There’s a cute little historic site just outside of the capital in McLean, Virginia, called the Claude Moore Colonial Farm. They do historical reenactments, and once upon a time the National Park Service helped run the place. But in 1980, the NPS cut the farm out of its budget. A group of private citizens set up an endowment to take care of the farm’s expenses. Ever since, the site has operated independently through a combination of private donations and volunteer workers.

The Park Service told Claude Moore Colonial Farm to shut down.

The farm’s administrators appealed this directive​—​they explained that the Park Service doesn’t actually do anything for the historic site. The folks at the NPS were unmoved. And so, last week, the National Park Service found the scratch to send officers to the park to forcibly remove both volunteer workers and visitors.

Think about that for a minute. The Park Service, which is supposed to serve the public by administering parks, is now in the business of forcing parks they don’t administer to close. As Homer Simpson famously asked, did we lose a war?

The hypocrisy that Obama has demonstrated during this “government shutdown” has been astounding.

He has barricaded open air war memorials to keep military veterans from visiting them, but he temporarily reopened the National Mall so that a huge pro-immigration rally that would benefit him politically could be held.

He has continued to fund al-Qaeda rebels in Syria that are trying to overthrow the Syrian government, but he has been withholding death benefits from families of fallen U.S. soldiers.

The conduct of the Obama administration during this shutdown has been so egregious that is hard to put into words.  Obama has chosen to purposely harm the American people in order to score political points.

But this is how our politicians view us these days.  As Monty Pelerin recently explained, most of our politicians have absolutely no problem with exploiting us for their own purposes…

The concept of political service has been replaced by that of masked exploitation. The public is no longer viewed as clients or constituents to be served. Instead they have become political prey. Politicians see the public as a collection of wallets and votes, fair game to be hunted as the means to expand power and wealth. Constituents are now the Soylent Green of the political food chain.

The political class assumes the public exists to serve them, not the other way around. Public participation beyond the lightening of wallets or the provision of votes is unwelcome. It is considered “interference” that must be deterred by the ruling class.

The political class is now a huge, voracious parasite. Like the plant in the Little Shop of Horrors, its needs have grown to the point where it threatens anything AG 47 ad(2)productive. Its needs now exceed the willingness for continued sacrifice on the part of the productive. The parasite threatens the very existence of the host.

The political Ponzi scheme of tax, borrow and spend has reached its limit. Either it will die when citizens turn on it or it will kill the productive, ensuring its own destruction.

It perishes in the end. Whether it takes civilization with it is the bigger question.

Is there anyone out there that still does not believe that our system is broken?

Hopefully cooler heads will prevail and power mad Obama will decide to toss the Republicans a few crumbs and this crisis will be resolved.

Because if this crisis is not resolved soon, it could have consequences that are far beyond what any of us could possibly imagine.

Comments

  1. Another person on this site contributed Eric Hoffer’s statement:  The enemy always uses what weapons  they fear the most.
    It’s now one of my favorites. 
    I use it as a litmus test to determine what the government fears and then acquire it or that which represent the opposing force to the government.
    The government is my enemy so I will use what they fear to fight them
    The government fears.
    1. Guns
    2. Bravery
    3. Truth
    4. Force of action
    5. Precious metals
    This AM, gold was hit so hard it shut down the CME.  The government fears gold and silver like a vampire fears Holy Water.  Having this metallic Holy Water is a great deterrent against the evilness of our government.  This government must be destroyed before they destroy us.

    • Don’t forget abortion, nothing a white male Republican fears more than a woman controlling her own body.

    • @Anita-Bonghitt :


      And there is nothing that their creator hates more than those women spilling the blood of the innocent who cannot defend themselves.

      Since when is your child part of your own body?

    • …which reminds me, for the definitive unabridged edition of Genesis please pick up a copy of the Enuma Elish – The Seven Tablets of Creation as translated by LW King. Then maybe we can all sit down and discuss what specific deity actually created us…but I digress grossly from the topic at hand… a thousand pardons ;-)

    • I vote for #4, time to storm DC and have an old fashioned lynching.

    • Don’t forget abortion, nothing a white male Republican fears more than a woman controlling her own body.
      This whole woman-controlling-her-own-body is one of the biggest, most harmful lies to come from the evil one.  To be sure, anyone subscribing to this has not the spirit of God but the only other alternative.  Repent for this horrible crime before it is too late.  We will all suffer the chastisements as a consequence for this humanist lie.

  2. Okay, I am also no fan of Obama either, but if I were Obama I would do the exact same thing. The republican far right started this and they are the ones that have to eat it, IMHO. Look at the young turks news cast on youtube and search Koch Brothers planned shut down a year ago to pressure to defund Obamacare. Obamacare may totally suck, but it passed, so let them implement it and we can decide if we want to vote out those that passed it. If your a voting member to a board on any business, if your vote is on the losing side of a decision, you still have to honor what the majority of the board voted for right or wrong. These guys in Congress have to do the same. By the way, gold and silver are getting smashed today, so I’m buying, and I know full well I could be on the losing side of my decision should metals keep dropping.

    • You want some truth? Here he is voting against the debt ceiling being raised.
       
      “The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. It is a sign that the U.S. Government can’t pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government’s reckless fiscal policies. … Increasing America’s debt weakens us domestically and internationally. Leadership means that “the buck stops here.” Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better.”
       
      Sen. Barrack Obama (March 20th 2006)

    • Bay, you are correct and always enjoy your perspective. If they are against the debt ceiling being raised then they should vote to not have it raised, plain and simple. However they are not doing so, because all they care about is throwing roadblocks to Obamacare. Their fight has nothing to do with what is best for the country, perhaps as a side note it might work out for us, but that is not what they intend. If I were Obama in this case, I wouldn’t budge. But then again, if I were Obama I would have never pushed Obamacare as a giveaway to private insurance and mandatory sign up either.

  3. The only “compromise” the Teabaggers  are interested in is the complete destruction of Obamacare, and a return to the system that guaranteed immense profits for insurance companies while millions of Americans had no health coverage at all.
     

    • Keep drinking the Kool Aid.

    • One of the problems I have with Obamacare is that it guarantees immense profits for insurance companies.
       
      Cut the insurance companies out of the picture and the cost of health care should immediately decrease by 25%.

    • Get a clue Anita-unless you’re just some govt hack which is just as likely.  You need to abandon this silly notion that either side is different.  They are ALL beholden to your corp overlords-if they weren’t, they would not be in office.  That’s where this is wrong, we don’t have legitimate choices anymore-just an illusion.  Hopefully folks will wake up and we can get the law of numbers on the right side.  A revolution is the only solution-hopefully not violent but these worthless %$(ks will not allow it to be non-violent-they want the violence since they thrive on it.  If Anita is just ignorant to the facts surrounding us, I hope she gets a clue and if she is your friendly govt hack, I hope she goes straight to Hell.  Have a nice weekend and remember what really matters in life.
       

    • Anita, who do you think wrote Obama Care?    It was the insurance and health care industry lobbyists!!   Obama Care is NOT a socialist program, it’s a corporate takeover of health care.
      Check out the action in the health care and insurance stocks, since the start of the year they have been soaring higher, why?   Investors know big profits are coming from Obama Care.
      Both parties are in on it, the debate about Obama Care is just for show, both have been paid off by the lobbyists.

    • Obamacare was written by the insurance companies as a perpetual bailout.
       

    • The government shutdown was planned for months by the Teabaggers.  The should own it and take responsibility for it.  “Don’t fart and blame it on the dog:.

    • I guess it’s official.  Anita is a worthless govt assclown.  Stay on your knees for your boy barry  you worthless assclown.

    • Another Obamabot like Zman lmfao don’t waste your time typing to it.

  4. Why is it that most don’t seem to understand that the president, regardless of his name or party, is not the one in charge and/or making the decisions that affect us all? Since Kennedy, they have all been front men for the fascist, globalist dictators behind the scenes. They are the ones calling the shots and the president just parrots what he’s told, and as long as we continue to see the president as the bad guy, these punks will continue to walk all over us with impunity, happy to receive absolutely no disdain from Joe Average. That’s exactly how they want it! Why don’t we get this? All that blaming the president does is polarize us by party when both parties in DC are on the same side really, it’s only American citizens who are not on the same page. We should be joining forces to battle the center dictators, not be dissing each others political party, affiliation or seated president. We all need to see things as Americans first, and only then can we truly see what needs to be done first. Kennedy’s assassination is the result when a president acts as though he is in REAL control. The elites just will not have it!

  5. Obama is trying his hardest to destroy America from within.  Much of what has been predicted in the movie 2016 Obama’s America has already happened.  The rest will have happened by the end of his term no doubt.

  6. I am so ready for a Revolution…..Way over due IMO! Our so called president is a blatant liar that deserves death by hanging and ignorant fools still respect this monkey.  PATHETIC

    • @ ss our president represents our country in the eyes of every foreign country and he also loves that power of the executive order.  We are in dire need of some serious changes in this country and it will not come from our fraudulent elected officials it will come from the people that respect the CONSTITUTION.

    • Great minds think alike.  The other day I made a comment about Revolution on a Yahoo news article.
      Apparently, there are many folks out there who agree with us.
       

    • The Tea Party is popular with those who can’t quite spell the whole alphabet and have horizontal family trees.

    • When your argument is so weak that it can barely stand on its own, feel free to attack the spelling & grammar of those whom you disagree with, and insult them as well.

  7. If yo want to get a really good idea of what Obamacare really represents, go over to The News Doctor Channel and listen to Eric Dubin’s interview with Dave Janda.  It will knock your socks off.

  8. @Woolly:  I think he’s mad because he has no metal.  Somebody please give him some metal.  And we will all live happily ever after!

    • No metal ?
        probably 
      No spine?
        absolutely 
      I doub’t if he’ll ever be invited to the former president’s club. 
      Preferable the club that the rest of the presidents belong to.

  9. America had a civil war because tea party types wanted to protect slavery, and it indulged McCarthyism because tea party types saw lies as a route to power, so it is quite possible tea party types will push the global economy off the cliff because they want to overthrow healthcare legislation and undo a black president. Tea party types could indeed elect the leader of that movement the next president because, well, America is crazy.

     

    • This assclown wants to perpetuate the idea that the Civil War had anything to do with slavery.  Take your nonsense somewhere else.  Too bad old Abe and the rest were perfectly fine with slavery.  You are a perfect, worthless, outcome of public education.  This site must scare the shit out of you and the rest of the assclowns.

    • @Anita
      Does it really matter that the present individual to hold the office of Pres. of the US is partially “black” ? It’s nice to be able to deride the man for ethnicity sake but shouldn’t we concentrate on his ineptitude for public good while aggrandizing his and his masters’ coffers? Or is that fact escaping you because you are color specific in addition to a few brain cells short of an imbecile?!

  10. Sounds like “Forced Debt Creation.”

  11. Any one without the blinders on knows what the deal is and has been, for quite a long time on this planet and this country. These hacks traded their souls for ruling the sheeple in return for earthly power. Well I’ve got news for them. Enjoy it while it lasts. Relish the feeling of putting your boot on the neck of the weak. It all ends. Ask the dinosaurs or Neanderthals or one of the hundred species that go extinct on this rock every God forsaken day if any of it amounts to a minor undulation in the topography of fecal mater ( “hill of shit” for those who are grammatically challenged ) IT dosent matter in the least…stack that along with the other essentials to truly self improve.

  12. Anita  you make me laugh.  That’s not always a good thing
    You are a target rich environment, offering vast opportunity for a response.  Normally I stay away from that but your posts are just too good to ignore.
    There are infinite opportunities for you to be a fool.
    Choose wisely.  You  might have to live with that for a while
    I’ll make a substantial donation to the United Ego College Fund in your name.
    Because a mind is a terrible thing. 

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