Jul 11, 2011
Gibson Plays Politics with Economy, Ready to Force Economic Disaster
Representative Chris Gibson (NY-20) is playing politics with the debt limit and has made it clear that he is willing to allow the nation to default on its obligations for the first time in our country’s history. Independent economists, as well as the head of Representative Gibson’s own party, have warned that not raising the debt limit would have catastrophic effects on the economy and cost Americans their jobs.
“Representative Chris Gibson is either incredibly naïve or incredibly irresponsible,” said Josh Schwerin, Northeast Press Secretary at the Democratic Congressional Campaign Committee. “Representative Gibson is holding the economy hostage and has made it clear that he is ready and willing to blow a hole in the American economy by forcing the nation to default on its obligations for the first time in history. Economists, and yes, even Speaker Boehner agree that failing to raise the debt limit will costs Americans their jobs and have a devastating effect on our nation’s economy.”
Background:
Gibson now pushing for brinksmanship over compromise. According to the Times Union, Chris Gibson is “refusing to raise the debt limit” and is willing to default on the debt if his policy positions are not accommodated. On why he was unwilling to compromise on taxes and spending cuts when he earlier in the year argued for concessions to avert a government shutdown, Gibson explained: “This is different. What you’re talking about here is, without the authorization to borrow, the government can only spend about 60 cents on the dollar until an agreement is reached. So you’re not talking about a full government shutdown. Now, we’re in a situation where we would have to find a way to make do on 60 cents on the dollar. So I think this is the time and this is the moment to really work out the deal to get us back to where we should be.” [Times Union, 7/4/11; Times Union, Editorial, 7/7/11]
Boehner warned of missing debt ceiling deadline. In July 2011, Speaker John Boehner warned that failing to raise the debt ceiling by the August 2 deadline, “puts us in an awful lot of jeopardy, and puts our economy in jeopardy, risking even more jobs.” [ABC News, 7/8/11]
Zandi: Missing debt deadline could cause recession. In June 2011, Mark Zandi, chief economist of Moody’s Analytics, said the economy could be severely impacted by a failure to raise the debt ceiling. “If we get to August 2 and there is no debt ceiling limit, and there has to be significant spending cuts – even if Congress and the administration reverse themselves days later, I think the damage will have been serious, and we probably would be thrown into a recession,” Zandi said. [Christian Science Monitor, 6/28/11]
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