More On Legal & Compliancefrom The Advisor's Professional Library
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The New Year promises to get off to a rocky start in politics. As Republicans on the Sunday talk shows talked of repeal of the health care law and drastic spending cuts, Austan Goolsbee, the chairman of the Council of Economic Advisers, warned against a failure to raise the country’s debt ceiling—a vote that Tea Party advocates have said they would use to send a message about spending.
On Fox News Sunday, Rep. Fred Upton, R-Mich., who is the incoming chairman of the House Energy and Commerce Committee, said that Republicans would vote to repeal health care before the State of the Union address. If the party failed to get a similar vote in the Senate, he said, “we’re going to go after this bill piece by piece.” Sen. Lindsay Graham, R-S.C., on Meet the Press, promised similar actions on Obama-sponsored legislation through defunding.
Allen West, R-Fla., also on appearing on Fox News Sunday, promised a tough fight on raising the debt ceiling, saying that the only way he would support such a measure was if there was also a discussion of “budgetary controls on the federal government, capping its spending. ...”
Graham also said he would not vote for a raise in the debt ceiling without “go[ing] back to 2008 spending levels.” And Rep. Mike Kelley, R-Pa., said on Face the Nation, “Raising the debt ceiling to me is absolutely irresponsible.”
In the teeth of so much Republican criticism, Goolsbee said on This Week With Christiane Amampour on CNN,that not extending the ceiling would be tantamount to “essentially defaulting on our obligations, which is totally unprecedented in American history.”
Goolsbee warned Republicans against “playing chicken” in a vote on the debt ceiling, and said, “The impact on the economy would be catastrophic. I mean, that would be a worse financial economic crisis than anything we saw in 2008.” He added that, if such an event came to pass, “that would be the first default in history caused purely by insanity.”