Panic, Ignorance Mark U.S. Debt Ceiling Debate

 

WASHINGTON — It may not have showed up in a reality show and it certainly wasn't the pick of the week on "American Idol," but it was important enough to further rattle ravenous market speculators and red-eared lawmakers on Capitol Hill still playing chicken: On May 16, the national debt hit its ceiling — then kept on moving past $14.3 trillion.

At occasional briefings, press conferences and lectures, U.S. Secretary of the Treasury Timothy Geithner appeared as batty as a heartbroken mad scientist.

"I have written to Congress on previous occasions regarding the importance of timely action to increase the debt limit in order to protect the full faith and credit of the United States and avoid catastrophic economic consequences for citizens," said Geithner, last week. in yet another letter to Congress, looking as grim-faced and aged as Professor Lime in the hit sci-fi series "Fringe." "I again urge Congress to act to increase the statutory debt limit as soon as possible."

But, as with most political and economic crises these days, life goes on. While the Treasury made dramatic moves on the day the debt peaked by temporarily divesting itself from two major government pension funds, the news didn't seem to hit the American public that hard.

It wasn't being bantered about on" The Michael Baisden Show" nor teased on TMZ. The Black blogosphere was, instead, lit up over Japanese evolutionary psychologist Satori Kanzawa's ill-founded bias against Black females, while tabloids were circling over the outing of former California Gov. Arnold Schwarzenegger's love child.

It all added to what observers lament is a severe lack of awareness surrounding the debt ceiling and what it is. While Washington wonks can pick, probe, and pontificate on every aspect of the national debt standing on their hands, after drowning in Tuesday happy hour alcohol, the average American simply sees it as yet another example of government spending beyond its means — and that's if they even know there is a debt problem.

"Miseducation is a big problem," admitted one Republican House, describing the electorate's collective intelligence on the issue in not so flattering terms. "One reason Members [of Congress] are playing games with it is because it's not a sexy topic. Most people are like 'debt what?,' literally looking up to see if a piano is going to fall on them. So, we can get away with playing chicken or going to the edge of the cliff because most people don't know what this is about."

This explains the sense of urgency Geithner and other Obama Administration officials are having in pushing the subject. The Treasury's Web site is freshly updated with Geithner missives to Congress urging action — like now. The home page is making certain few miss the big-as-day primer titled "Get the Facts: Raising the Debt Ceiling."

And, while everyone from the President to his Treasury Secretary on down to the White House cooks are warning of a "financial meltdown" that will make the recent recession look like toddler potty training should Congress decide to vote against raising the debt ceiling, signs suggest the American public either doesn't care or is too mad to be bothered.

Recent polls show the reality of the above-quoted aide's blithering assessment combined with disturbing political schizophrenia on the topic. Princeton, N.J.-based Gallup, titan of weekly polls, showed a majority of respondents actually wanting Congress to vote against the debt ceiling — despite the Book of Revelation-style outcome, as warned by Obama Administration officials, if such a vote were to occur.

Forty-seven percent of poll respondents didn't want the debt ceiling raised, while 34 percent were "unsure" and 19 percent "favored it" (Perhaps this later group, a clear minority, were those who momentarily turned their heads away from "Celebrity Apprentice" and Donald Trump's ugly public demise?)

A CNN poll was a bit more caustic: 60 percent were firmly against raising the debt ceiling compared to 37 percent who wanted it raised. Not surprisingly, seven out of 10 Republicans "rejected" the notion of raising it, while a small majority of Democrats reluctantly went along with the whole idea of kicking the can. Independents, however, are dead set against it across the board. That includes an NBC/Wall Street Journal poll, similar to the Gallup results, which reflects 46 percent were against, 38 percent unsure, and 16 percent for it.

Yet, in an inexplicable roundabout that, perhaps, suggests lack of understanding, the CNN poll showed 58 percent agreeing with Geithner, and company, that financial Armageddon will ensue, if the ceiling wasn't raised.

Meanwhile, budget expert Tad DeHaven, from the libertarian Cato Institute, sees an opportunity in all of this.

"I don't put a lot of stock in public polling, especially when it comes to budgetary issues," quips DeHaven. But, he sees a trend where most people paying attention to the issue are probably a bit more aware than Washington insiders would like to admit. "For most people polled, I'm guessing that their thought process goes something like this: Debt equals bad…ceiling on debt equals good…therefore, debt above ceiling equals bad."

"The public's intuition that raising the debt ceiling is 'bad' is spot on," DeHaven added. "Therefore, it's an opportunity to educate the public on why runaway debt is a problem and what can be done to solve it. Unfortunately, too many politicians want to continue promising voters a free lunch to be paid for by their neighbor. But, their neighbor doesn't have enough money to pay for all the free lunches the politicians are promising."

That dynamic created a bit of surrealism in American politics last week. Congress, for their part, seemed transfixed in a bizarre mix of both poker-face and chill mode. Most Members on both sides of the aisle seem uncomfortable talking about what their constituents do or don't know about the debt ceiling debate — in fact, some Republican Members are even suggesting that the federal government begin selling off property and other assets to pay down its debt.

Philadelphia-area Rep. Chaka Fattah (D-PA), attempting to best the best of political predictions on the issue, was still promoting his very own why-didn't-I-think-of-that "transaction tax" concept — in which obscenely wealthy Wall Street and hedge fund transactions would be hit with a 1% tax that could wipe out the federal deficit in short time.

"I'm still pushing that," said Fattah, when asked about the ongoing budget wars. "I believe that when we get to the revenue side of things, it will be heavily considered. If we have a better mousetrap, this is the one."

Vice President Joe Biden, known for his keep-it-realism, was upbeat with thumbs-up outside Washington, D.C.'s historic Blair House, after working on the dreary details of a deal as de-facto mediator in conversations between Democrats and Republicans on the debt ceiling.

Described by some on Capitol Hill as "the only game in town," Biden seemed happy to push it along, managing his own raucous Washington Insider "Gang of Six," an interesting swirl of the Hill's legislative elite: the Senate Minority Whip Jon Kyl (R-AZ), Sen. Max Baucus (D-MO.), Sen. Daniel Inouye (D-HA), House Majority Leader Eric Cantor (R-VA), House Assistant Democratic Leader James Clyburn (D-S.C.), and Rep. Chris Van Hollen (D-MD).

Experts seemed relieved to find out that the Blair House gang, kicking it over the budget like an old school frat party, was —at least — making some progress with $200 billion in proposed cuts, tentatively agreed to as a condition of a vote on raising the debt ceiling.

Meanwhile, budget talks within another "Gang of Six" on Capitol Hill broke down like an old Cadillac on the side of the road after outgoing Sen. Tom Coburn (R-OK) pulled out over details of a deal that were still unclear. As Senators go back to the drawing board, Hill staffers are stuffing parachutes.