First let's define terms. Default means failure to pay interest upon the national debt. Which is treasury bills. T-bills for short. Default does not mean failure to pay social security, pay the bureaucrats, pay the troops, make home loans, open the national parks, pay medicare, or do all the other things the Federal government does. It just means failure to pay off the T-bills, or pay interest on the T-bills.
Right now American T-bills are the safest investment on the planet. America has always paid off on bonds, and this goes way back, like back to the Revolution. T-bills are issued by the strongest government on the planet, backed by the strongest economy on the planet, protected by the strongest armed forces on the planet. As a result, we can raise money anytime we please by printing up some more T-bills and selling them. People give us real cash money and we give them paper T-bills. And we don't even promise them very much interest. This is VERY useful to us. It's a national credit rating of 1000, the best you can get.
Default, will screw this up for ever. Default means we stop paying interest on T-bills and refuse to redeem them for cash when they mature. Do this just once, and the trust is broken. We will have to pay much higher interest rates to borrow, and we face the prospect of not being able to sell T-bills when we need to.
Any man of even marginal intelligence would know that we ought to pay off on the national debt BEFORE we pay anything else.
Is Obama a man of even marginal intelligence? To hear him talk, no. He has been threatening default for weeks. What if he carries thru on his threats?
Judging by the way he has made the "shutdown" as painful as possible, he is a man who enjoys inflicting pain on his citizenry. Is he dumb enough to default just to inflict more pain on his citizens?
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