The Perils of Toying with the Debt Ceiling

[bobbyw24]

Threatening to default should not be a partisan issue. In view of all the hazards it entails, one wonders why any responsible person would even flirt with the idea.

– Alan S. Blinder, Princeton professor of economics, former vice chairman of the Federal Reserve

http://www.webofdebt.com/images/web_tb.jpg

A game of Russian roulette is being played with the national debt ceiling. Fire the wrong chamber of the gun, and the result could be the second Great Depression.

The first Great Depression led to totalitarian dictatorships, war to consolidate power, and concentrations of capital in the hands of a financial elite. The trigger was a default on the global reserve currency, in that case the pound sterling. The U.S. dollar is now the global reserve currency. The concern is that default could create the same sort of global panic today. Dark visions are evoked of the President declaring a national emergency, FEMA plans locking into place, camps being readied for protesters, and the secret government taking over . . . .

This may all just be political theater, but do we really want to get close enough to the economic precipice to find out? The conservative ideologues toying with the debt ceiling are doing it to force cuts in the budget, a budget that was already approved by Congress. Congress is being held hostage by a radical minority pushing a risky agenda, one that is based on an economic model that is obsolete.

High-stakes Gambling . . .

http://webofdebt.wordpress.com/2011/05/30/inviting-chaos-the-perils-of-toying-with-the-debt-ceiling/

[lynnf]

of course, this jerk is not going to properly cover the perils of spiraling debt and eventual repudiation of the debt that continuation would absolutely require.

[bobbyw24]

of course, this jerk is not going to properly cover the perils of spiraling debt and eventual repudiation of the debt that continuation would absolutely require.

No need to label a person a "jerk" simply because you don't agree with her.

[cindy25]

maybe runaway inflation would be a good thing; it would hurt govt employees/retirees , and big companies the most. and level the playing field to start over.

[cindy25]

No need to label a person a "jerk" simply because you don't agree with her.

ostrich might be a better word, or socialist ostrich

[bobbyw24]

ostrich might be a better word, or socialist ostrich

Ms. Brown is an accomplished attorney and author.

You should read her book: The Web of Debt

Here is a sample:

CAPTURED BY THE DEBT SPIDER

President Andrew Jackson called the banking cartel a "hydra-headed monster eating the flesh of the common man." New York Mayor John Hylan, writing in the 1920s, called it a "giant octopus" that "seizes in its long and powerful tentacles our executive officers, our legislative bodies, our schools, our courts, our newspapers, and every agency created for the public protection." The debt spider has devoured farms, homes and whole countries that have become trapped in its web. In a February 2005 article called "The Death of Banking," financial commentator Hans Schicht wrote:

The fact that the Banker is allowed to extend credit several times his own capital base and that the Banking Cartels, the Central Banks, are licensed to issue fresh paper money in exchange for treasury paper, [has] provided them with free lunch for eternity. . . . Through a network of anonymous financial spider webbing only a handful of global King Bankers own and control it all. . . . Everybody, people, enterprise, State and foreign countries, all have become slaves chained to the Banker's credit ropes.1

Schicht writes that he had an opportunity in his career to observe the wizards of finance as an insider at close range. The game has gotten so centralized and concentrated, he says, that the greater part of U.S. banking and enterprise is now under the control of a small inner circle of men. He calls the game "spider webbing." Its rules include:

Making any concentration of wealth invisible.
Exercising control through "leverage" – mergers, takeovers, chain share holdings where one company holds shares of other companies, conditions annexed to loans, and so forth.
Exercising tight personal management and control, with a minimum of insiders and front-men who themselves have only partial knowledge of the game.

The late Dr. Carroll Quigley was a writer and professor of history at Georgetown University, where he was President Bill Clinton's mentor. Dr. Quigley wrote from personal knowledge of an elite clique of global financiers bent on controlling the world. Their aim, he said, was "nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole." This system was "to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements."2 He called this clique simply the "international bankers." Their essence was not race, religion or nationality but was just a passion for control over other humans. The key to their success was that they would control and manipulate the money system of a nation while letting it appear to be controlled by the government.

The international bankers have succeeded in doing more than just controlling the money supply. Today they actually create the money supply, while making it appear to be created by the government. This devious scheme was revealed by Sir Josiah Stamp, director of the Bank of England and the second richest man in Britain in the 1920s. Speaking at the University of Texas in 1927, he dropped this bombshell:

The modern banking system manufactures money out of nothing. The process is perhaps the most astounding piece of sleight of hand that was ever invented. Banking was conceived in inequity and born in sin . . . . Bankers own the earth. Take it away from them but leave them the power to create money, and, with a flick of a pen, they will create enough money to buy it back again. . . . Take this great power away from them and all great fortunes like mine will disappear, for then this would be a better and happier world to live in. . . . But, if you want to continue to be the slaves of bankers and pay the cost of your own slavery, then let bankers continue to create money and control credit.3

Professor Henry C. K. Liu is an economist who graduated from Harvard and chaired a graduate department at UCLA before becoming an investment adviser for developing countries. He calls the current monetary scheme a "cruel hoax." When we wake up to that fact, he says, our entire economic world view will need to be reordered, "just as physics was subject to reordering when man's world view changed with the realization that the earth is not stationary nor is it the center of the universe."4 The hoax is that there is virtually no "real" money in the system, only debts. Except for coins, which are issued by the government and make up only about one one-thousandth of the money supply, the entire U.S. money supply now consists of debt to private banks, for money they created with accounting entries on their books. It is all done by sleight of hand; and like a magician's trick, we have to see it many times before we realize what is going on. But when we do, it changes everything. All of history has to be rewritten.

The following chapters track the web of deceit that has engulfed us in debt, and present a simple solution that could make the country solvent once again. It is not a new solution but dates back to the Constitution: the power to create money needs to be returned to the government and the people it represents. The federal debt could be paid, income taxes could be eliminated, and social programs could be expanded; and this could all be done without imposing austerity measures on the people or sparking runaway inflation. Utopian as that may sound, it represents the thinking of some of America's brightest and best, historical and contemporary, including Abraham Lincoln, Thomas Jefferson and Benjamin Franklin. Among other arresting facts explored in this book are that:

http://www.webofdebt.com/excerpts/introduction.php

[lynnf]

No need to label a person a "jerk" simply because you don't agree with her.

regardless of the fact that I agree with most of her other premises, she undermines herself by denying probably the most useful tool we have to move closer to our goal of smaller government and sound money and, not only denying it but insinuating a label for those that would use it as being irresponsible or worse. my initial evaluation of jerk still stands since this demonstrated characteristic fits the classic definition of jerk to my satisfaction.

[bobbyw24]

regardless of the fact that I agree with most of her other premises, she undermines herself by denying probably the most useful tool we have to move closer to our goal of smaller government and sound money and, not only denying it but insinuating a label for those that would use it as being irresponsible or worse. my initial evaluation of jerk still stands since this demonstrated characteristic fits the classic definition of jerk to my satisfaction.

Great news!

[cindy25]

if you need to get rid of rats or mice, you need to cut off their food supply. Bureaucrats are no different. stop paying the troops, and the wars will end.

[bobbyw24]

if you need to get rid of rats or mice, you need to cut off their food supply. Bureaucrats are no different. stop paying the troops, and the wars will end.

I agree completely.